Snam and hydrogen
The aim of Snam, by 2050, is to transport entirely decarbonised gas (not only hydrogen, but also biomethane), helping to strengthen Italy's role as a European hub, with a view to exporting clean energy to Northern Europe. 50% of the approximately €7.4 billion of Snam's 2020-2024 business plan is for the replacement and development of assets to standards that are also compatible with hydrogen. To date, the company estimates that more than 70% of its pipelines are ready to carry hydrogen. Snam has also adopted new internal regulations for procurement to ensure that all materials for the new sections of the grid can transport, without cost increases, not only natural gas and biomethane, but also, in line with the development of the regulatory framework, increasing hydrogen percentages up to 100%.
In addition to preparing its infrastructure for hydrogen transport and storage, Snam has entered into partnerships with various operators, in compliance with unbundling regulations, to pool their respective expertise and enable the development of the supply chain at Italian and European level. Firstly, the company is working with railway operators (FS Italiane and Ferrovie Nord), traction suppliers (Alstom) and energy/utility suppliers (Eni, A2A and Hera) to develop refuelling infrastructure to make hydrogen mobility by rail possible in Italy.
Snam is also collaborating with players that use their upstream and downstream infrastructure on projects and experiments aimed at using hydrogen to decarbonise certain industrial processes or power generation (Tenaris and Edison) and is positioning itself in new technologies that could enable the development of hydrogen (ITM Power, De Nora), in particular electrolysers.
In April 2019, Snam was the first energy company in Europe to introduce of a mix of 5% hydrogen by volume and natural gas into its transmission network. The trial, which successfully took place in Contursi Terme, in the province of Salerno, involved the supply, for about a month, of H2NG (hydrogen-gas mixture) to two industrial companies in the area, a pasta factory and a mineral water bottling plant. The initiative received international recognition, with dedicated coverage from Bloomberg, Financial Times and New York Times. The Contursi experiment was replicated in December 2019, doubling the percentage of hydrogen by volume to 10%.
By applying the percentage of 10% of hydrogen to the total gas transported annually by Snam, 7 billion cubic meters of it could be introduced into the network every year, an amount equivalent to the annual consumption of 3 million families, allowing for a reduction in carbon dioxide emissions of 5 million tons.
In 2020, Snam also tested the world's first "hybrid" hydrogen turbine designed for a natural gas transportation infrastructure. The turbine, produced by Baker Hughes in Italy and fueled up to 10% with hydrogen, will be installed by 2021 in the Snam thrust plant in Istrana, in the province of Treviso.
The company is now engaged in verifying the full compatibility of its infrastructures with increasing quantities of hydrogen mixed with natural gas, as well as in supporting the development of the Italian supply chain, to encourage the use of hydrogen in multiple sectors, from industry to transport. Currently about 70% of Snam's natural gas pipelines are compatible with hydrogen.
The three pillars
In order to guide the energy transition towards a greater use of hydrogen, Snam is acting as a leader carrying out its vision based on three fundamental pillars:
Assess the compatibility of the existing infrastructure with regard to the transport of hydrogen, with a focus on:
- compressor stations
Development of the value chain
Define the strategy to encourage the growth of all phases of the value chain, with a focus on:
- Conduct pilot projects to increase the production and use of H2, through strategic partnerships in the hard-to-abate industries (e.g. steel mills, refineries, other energy-intensive industrials, mobility...)
- Scouting for investment opportunities in innovative technologies (fuel cell, hydrogen production and storage)
Define the roadmap for integrating hydrogen into the existing energy system with a focus on:
- Evolution of the regulatory framework
- Analysis of medium-long term scenarios of the role of hydrogen in the energy mix
Research and development
As part of international efforts to develop hydrogen, Snam has signed a Memorandum of Understanding with Mubadala Investment Company with the aim to collaborate on joint investment and development initiatives on hydrogen and contributed to the establishment of a coalition with six other companies from various countries and sectors (Iberdrola, Orsted, Yara, Envision, ACWA Power and CWP Renewables), opening this up to others in the run-up to COP26. The coalition’s mission is to drive development of new green hydrogen projects globally and to help reduce the associated costs more quickly.
Snam is part of the Clean Hydrogen Alliance launched at European level to support the strategy of the EU Commission that leverages hydrogen to achieve the Green Deal by eliminating net CO2 emissions on the continent by 2050.
The company also participates in numerous institutional and associational tables dedicated to hydrogen at national and international level. At the European level, it is also a member of Hydrogen Europe, while in Italy it is represented in the H2IT category association - Italian Hydrogen and Fuel Cell Association.
Globally, the company is part of the Hydrogen Council, an initiative launched in 2017 at the World Economic Forum in Davos to create a coalition of leading companies in their respective sectors committed to accelerating investments in hydrogen.
According to a study conducted by Navigant and commissioned by the European Gas for Climate consortium, which also includes Snam, our continent has a hydrogen and biomethane production potential of 270 billion cubic meters by 2050, which would lead to full decarbonisation with economic savings of 217 billion euros per year compared to an energy scenario that does not involve the use of gas. Another research, conducted by Snam in collaboration with McKinsey, showed that hydrogen could meet around a quarter of Italy's final energy consumption by 2050 (up to 22 billion equivalent cubic meters) in a scenario of profound decarbonisation.
As part of the research, Snam also collaborates with the Bruno Kessler Foundation, which develops studies on technologies destined to revolutionize the production of clean hydrogen in the near future, making it an integral part of the long-term solution for a carbon neutral energy system. Finally, the company has signed a research and development agreement with the Polytechnic of Bari to create a prototype of an autonomous energy network based on the use of hydrogen produced from renewable sources.
Ambrosetti-Snam Research, H2 Italy 2050: a national hydrogen supply for the growth and decarbonization of Italy
Italy can utilise hydrogen both to achieve decarbonisation targets and to create new forms of industrial competitiveness, leveraging its manufacturing potential and its skills in the natural gas sector. This is what emerges from the "H2 Italy 2050: a hydrogen value chain for growth and decarbonization" study, created by The European House - Ambrosetti in collaboration with Snam to examine for the first time the potential of the Italian hydrogen value chain.
The contents of the research have been presented on 5 September 2020, as part of the The European House - Ambrosetti Forum, in a press conference attended by Valerio De Molli, Managing Partner & CEO of The European House - Ambrosetti, Marco Alverà, Chief Executive Officer of Snam, and Esko Aho, Prime Minister of Finland and innovation expert, representing the research Advisory Board, which also includes Steve Angel, CEO of Linde, Suzanne Heywood, Chairman and Acting CEO of CNH Industrial, Francesco Profumo, President of Compagnia di San Paolo, and Paolo Borzatta, Board Member of The European House - Ambrosetti.
09 July 2021 - 09:54 CEST