The German government approved on Tuesday the core hydrogen network plan proposed by transmission system operators (TSOs), which will be gradually put into operation by 2032.

According to the Federal Network Agency (BNetzA) the approved network covers 9,040 kilometres (5,617 miles) of pipelines with “minor adjustments.” This is roughly 600 km shorter than the draft proposal.

Around 60% of the infrastructure will rely on repurposed gas pipelines, with the remaining 40% to be newly built. With 13 border crossing points, the infrastructure will have a feed-in capacity of 101 gigawatts and a feed-out capacity of 87 GW. The estimated investment cost stands at €18.9 billion ($20.43 billion), Kallanish reports.

“With the approved hydrogen core network, the network operators can now gradually build and operate the infrastructure for hydrogen. The first lines will be converted from next year,” notes Klaus Müller, president of the agency.

The “intensive planning” of the network has taken over a year and a half, with TSOs first working to identify hydrogen production and demand, as well as gas pipelines suitable for conversion to hydrogen. The government’s involvement accelerated the process, with the core network seen as the “starting point for a new infrastructure and a central building block of the energy transition.”

“The hydrogen core network sends a decisive signal for the future viability of Germany as a business location,” comments economy and climate protection minister Robert Habeck. “It is a basic prerequisite for the successful ramp-up of hydrogen and thus for the decarbonisation and competitiveness of industry in Germany.”

He describes the country as a “pioneer in Europe” sending an “important signal” to European neighbours.

The core network lines will be built and operated by the private sector and financed by user fees. However, since there will be relatively few customers at the beginning, the investment costs cannot be fully passed on to users and fees are capped. “An amortisation account ensures that the shortfall in revenue in the first phase is offset by additional revenue later on,” the government explains.

Except the Important Project of Common European Interest (IPCEI) line projects funded by the federal and state governments, no federal funds will flow into the core network. Yet, the financing concept includes financial protection from the federal government against unforeseeable developments.