Hydrogen Finland – global markets on the horizon

Blog post
Antti Arasto,
Jari Kiviaho

Finland could potentially become a significant exporter of hydrogen-related technology, green hydrogen and hydrogen products, but such a role could only be achieved through having the relevant solutions proof tested in relevant environment first. That would require long-term engagement, piloting and industrial demonstrations.

What is different in the current hydrogen boom compared to previous ones?

According to the IEA Report (2019), there have been several ‘hydrogen booms’ in the past, all of which have slowly faded away. In all the previous cases, the hydrogen boom has been preceded by an increase in the oil and gas prices. Most of the development work and technology implementation has mainly taken place on the terms of and/or from the perspective of transport. This has not generated a flourishing hydrogen economy: So, what is different this time around?

This time, the hydrogen hype is driven by the general concern about the environment, global warming and the need to radically cut emissions. Or perhaps we should not even be talking about a hype, because the efforts being made are genuine and results-oriented. In addition to the unprecedentedly strong political and popular support given to low-carbon solutions, significant advances have also been made in hydrogen-related technologies. The recent successes, particularly in the fields of solar and wind energy, but also in the battery technology and electrification of the transport sector, have shown that it is possible to build clean energy and industry. In addition, hydrogen is not just a new success story for the energy industry, but, being an emission-free energy carrier and raw material, it can also be utilised by many other industries.

Why hydrogen?

Hydrogen is not a primary energy source, such as wind or solar energy, but it acts as an energy carrier and storage, in the same way as fossil fuels. Green hydrogen is a pure raw material and, when produced in a correct manner and used as part of energy systems, it does not cause environmentally harmful emissions. In other words, hydrogen can act as one of the tools in the fight against global warming.

Production of hydrogen by electrolysis can be profitable already in a relatively small scale, but the production can also be easily scaled to large volumes, thus generating economies of scale. In other words, profitable hydrogen production does not necessarily require large production volumes, but the modular components and serial production may provide major potential for lowering the costs. Producing hydrogen from renewable energy may also aid with storing energy in overproduction situations when the supply of wind or solar power exceeds the consumption.

Power-to-x technologies (P2X) can be applied to the manufacture of synthetic replacements for fossil fuels. The raw materials needed include carbon dioxide or nitrogen and hydrogen produced from clean electricity through electrolysis and water. The end products, such as methane, methanol and ammonia, are known chemicals that can be used as fuels but also as raw materials in the chemical industry. This could bring solutions to the demands of our current carbon-dependent world without the need to make extensive investments in new infrastructures. For the users, it would also enable as simple transition to cleaner alternatives as possible. 

What could hydrogen mean to Finland?

The same applies to hydrogen as any other single technological low-carbon solution: on its own, it will not be enough to enable the achievement of our massive goal. We need all the solutions available, and since they all have their own characteristics, some are better suited for certain needs than for others. In the following, we list a few areas of application and perspectives that we believe Finland should pay particular attention to. 

  1. Traditional industrial applications where fossil hydrogen (SMR ) can be replaced by clean hydrogen facilitate the achievement of emissions targets and provide a clear competitive advantage on the low-carbon market.
  2. The use of hydrogen in ‘hard-to-decarbonise’ sectors, such as replacing the carbon based reduction process in the steel industry with a similar process based on a clean hydrogen process. 
  3.  The transition of maritime transport and the heavy transport sector from traditional fossil fuels to using hydrogen-based fuels will help Finland achieve its emissions targets while opening new markets for the Finnish industrial sector.
  4. Replacing fossil hydrocarbons, such as natural gas and fuels, with P2X products (e-fuels) on a significant scale in the transport sector (long-haul and heavy land transport) and peak energy production in particular.

By promoting the application of technologies in these potential areas of use, Finland could become a significant hydrogen technology exporter by operating in every value network field in areas such as power electronics, electrolysers, power lines or complete energy solutions. Finland's advantages also include the renewable wind energy potential and a good electricity infrastructure. By using them, Finland could function as a significant hydrogen producer and exporter. As one of the tools, hydrogen could help Finland become a carbon-neutral society and achieve energy self-sufficiency, enabling us, at the same time, to develop export products for economies that are even more hydrocarbon-addicted than Finland. 

Hydrogen is a theme linked to a wider value network, which comprises many different perspectives and objectives for different actors. For this reason, it is essential with a view to Finland's future role that we can generate genuine European cooperation around the topic. The market is enormous, and most of it is found outside Finland. The aim is to generate a national joint effort in which the industry, research and central government, as well as citizens, all have an important role to play as part of the ecosystem, primarily geared towards the European common market and world conquest. Only in this way will we be able to fully leverage the opportunities offered by Europe at a national level in research and development, and from the perspective of commercial products. Finland should create a genuinely functional ecosystem based on concrete projects and the underlying commercial opportunities and, at the same time, on extensive R&D cooperation that integrates actors across sectoral boundaries.

A realistically minded mechanical engineer and an expert with long-term experience in the hydrogen sector reflect aloud what hydrogen means to Finland and, above all, what we should do about it.

Antti Arasto
Antti Arasto
Jari Kiviaho
Jari Kiviaho
Research Professor
Our vision beyond 2030

The efficient utilisation of renewable and carbon-neutral energy in industry, transport, and construction holds a key position in solving climate issues.