Germany's hydrogen ambitions won't be derailed by water scarcity concerns. A new analysis from the German Institute for Economic Research (DIW Berlin) reveals that planned electrolysis capacity through 2030 will consume just 0.15 percent of current water extraction. The real success factors lie elsewhere.
Ten gigawatts require 26 million cubic meters annually
Germany's National Hydrogen Strategy (NWS) targets ten gigawatts of electrolysis capacity by 2030. Current installations total just 170 megawatts – merely 1.7 percent of the goal. The DIW modeling study, published August 13, calculates an annual water demand of approximately 26 million cubic meters for the ten-gigawatt target.
Study author Dana Kirchem breaks down the requirements: "One kilogram of hydrogen needs nine liters of deionized pure water, plus cooling water." Depending on the water source, around 35 liters of fresh water are required per kilogram of hydrogen produced.
Hydrogen demand is set to climb from today's 46 terawatt-hours to between 95 and 130 terawatt-hours by 2030.
Northern Germany benefits from offshore wind advantage
DIW analysis identifies Schleswig-Holstein as the optimal electrolysis location, thanks to accessible, cost-effective offshore wind power. "Federal states with high renewable energy potential, ideally offshore wind, offer the best conditions," Kirchem emphasizes.
However, without the planned 9,040-kilometer hydrogen core network, production would shift closer to consumption centers. "When we assume limited hydrogen transport capacity, proximity to hydrogen consumption centers becomes more relevant," the researcher explains.
Water costs negligible in economic equation
Water costs barely impact electrolysis economics, representing just 0.5 percent of total costs. Even nationwide harmonization to Berlin's premium rate of 31 cents per cubic meter would scarcely influence location decisions.
The DIW acknowledges limitations: "We can say little about actual water prices for electrolyzers because they lack transparency."
Seawater offers regional solution
While Germany ranks as water-rich, regional and seasonal water stress can occur. "Excessive water extraction in certain regions may exacerbate water stress. Therefore, locally available water sources for electrolysis should be assessed," Kirchem cautions.
For regional water bottlenecks, the DIW analysis reveals alternatives: Desalinated seawater remains unlimited available to coastal states. The DVGW had already highlighted such alternatives including treated wastewater from treatment plants in 2023.
Rapid core network expansion essential
DIW researchers derive concrete recommendations from their analysis: Accelerate hydrogen core network expansion to enable electrolysis concentration in less water-stressed regions. They also demand greater water sector transparency, particularly regarding electrolyzer water pricing.
The institute recommends systematically integrating water stress risk into approval processes and funding criteria for electrolysis projects – echoing 2023 DVGW calls for considering regional conditions.
