Europe's Clean Energy Puzzle: Hydrogen, Renewables, and Nuclear at the Heart of 2050 Forecasts

As we look into the future, the period post-2040 carries significant uncertainties. The ambition for a predominantly fossil-free energy system is expected to remain, significantly influencing political stances. Over this 30-year horizon, emerging technologies will undoubtedly play a pivotal role. Although it's uncertain which technology might dominate, hydrogen stands out as a frontrunner, with nuclear energy also holding prominence in several nations. Research on small modular reactors (SMR) aligns with this trend. While nuclear fusion has made significant advancements, its dominant market presence before 2050 remains uncertain.

On the production front, we anticipate the core technologies to be renewable sources such as wind, solar, and hydro. These will be bolstered by both large and small-scale nuclear technologies and gas power plants capable of utilising both natural gas and hydrogen. From a consumption perspective, apart from the conventional household, industrial, commercial, and service sectors, we anticipate a surge in the use of heat pumps and electric  to increase overall demand, particularly in the major markets of Germany, France and Spain.

Hydrogen is poised to act as the linchpin, seamlessly integrating all sectors and green hydrogen particularly will play a vital role in the decarbonisation of Europe’s energy supply's. Its primary applications will be in heating for industries, powering heavy-duty vehicles, and meeting peak load demands for building heating, especially in conjunction with heat pumps for older structures, possibly in the form of synthetic natural gas (SNG). Hydrogen's role as an electricity storage solution is also noteworthy. Currently, we expect green domestic hydrogen supply to fall short of demand, necessitating reliance on blue, turquoise, and pink hydrogen, as well as imports from outside the EU, likely in the form of green ammonia, which could later be converted to hydrogen.

Vija Pakalkaite, the product manager for mid- and long-term products at Volue Insight, states: “Our long-term report to 2050 navigates through a landscape that's almost three decades into the future. The era post-2040 ushers in notable uncertainties, with a near fossil-free energy supply shaping political directives. The future will undeniably be moulded by new technologies, and as we examine the production landscape, renewables like wind, solar, and hydro will serve as the foundation, backed by diverse nuclear technologies and adaptive gas power plants."