Hydrogen is a colourless gas. So why do people talk about the colours of hydrogen? The colours refer to how it is produced – and how climate-friendly the process is. In our series on the colours of hydrogen, we explain what each colour means. We conclude with the most widely discussed variety: green hydrogen.
Green is the most prominent colour in the hydrogen spectrum.Green is the most prominent colour in the hydrogen spectrum. As a climate-friendly long-term energy store, green hydrogen can take over part of the role currently played by natural gas. It can also serve as a feedstock or process gas, helping industries such as chemicals and steel production to reduce their carbon emissions.
For now, however, green hydrogen remains in short supply. A study published by the University of Cologne at the beginning of the year found that the expansion of production capacity is lagging behind the timetable set out in Germany’s National Hydrogen Strategy. By early 2026, only 1.8 per cent of the production capacity planned for 2030 had been achieved.
Yet green hydrogen can do more than simply cut emissions. “It can play a decisive role in stabilising an energy system based on variable renewable energy sources, making the energy transition more affordable,” says Professor Andreas Peschel, Managing Director of the Institute for a sustainable Hydrogen Economy. The future may be green, but getting there will be a challenge.
When is hydrogen considered green?
Two technical conditions must be met for hydrogen to qualify as green.
First, it must be produced by an electrolyser. This device uses electricity to split water into hydrogen and oxygen. Research and development are continuing to make the next generation of electrolysers cheaper, more efficient and more robust. The targets set by the US Department of Energy illustrate this ambition. This year, one kilogram of green hydrogen – containing around 33 kilowatt-hours (kWh) of energy – is expected to be produced using 51 kWh of electricity. In the longer term, the goal is to reduce this to 46 kWh.
Second, the electricity itself must be renewable, for example from wind or solar power. If the 51 kWh required for electrolysis comes from a coal-fired power station, around 42 kilograms of carbon dioxide (CO₂) are emitted; if it comes from a gas-fired power station, emissions are around 25 kilograms. By comparison, producing one kilogram of grey hydrogen from natural gas releases about 10 kilograms of CO₂. These figures are based on data from the Intergovernmental Panel on Climate Change (IPCC). “If we want electrolysis to reduce emissions, electricity from renewable sources is the only sensible option,” says Andreas Peschel.
“We can make much better use of renewable energy than we do today. The buffering function reduces the cost of both green hydrogen and renewable electricity overall. That would be a key step towards scaling up green hydrogen.”
Not all renewable electricity qualifies
However, renewable does not automatically mean eligible.
Through the Renewable Energy Directive III (RED III), the European Union aims to prevent electrolysers from diverting existing renewable electricity away from other users, forcing fossil-fuel power stations to fill the gap. The legislation therefore requires the electricity used for hydrogen production to be closely matched in time with the electrolysis process, to originate from the same or a neighbouring electricity market region, and, wherever possible, to comply with the so-called additionality principle by coming from newly built renewable energy installations. In other words, the key question is not only whether low-cost renewable electricity is available, but also whether it meets the EU’s eligibility criteria.
“Highly beneficial for the energy system”
Ironically, RED III also limits a feature that could quickly make green hydrogen even more valuable for the future energy system: its ability to act as a buffer by absorbing surplus electricity and making it available later when needed.
“Green hydrogen can provide significant benefits to the energy system,” says Andreas Peschel. When wind turbines and solar farms generate more electricity than the grid and existing storage facilities can absorb, electrolysis capacity can be ramped up to convert the surplus into green hydrogen for later use.
Without this buffering function, excess generation creates additional costs. One option would be to expand the electricity grid to cope with rare peaks in renewable generation. That would be rather like a small local football club building a stadium large enough to host a one-off cup match against Bayern Munich. Alternatively, wind turbines and solar installations can simply be curtailed, even though operators continue to receive compensation under Germany’s Renewable Energy Sources Act (EEG). A further option is to export the surplus electricity abroad at very low prices.
“We can make much better use of renewable energy than we do today. The buffering function reduces the cost of both green hydrogen and renewable electricity overall. That would be a key step towards scaling up green hydrogen. At present, however, EU regulation stands in the way. Simplifying these rules would reduce bureaucracy and help ensure we do not lose our competitive edge,” says Andreas Peschel. In particular, the additionality principle makes it more difficult to make effective use of existing renewable energy assets.
Unlocking the potential
Electrolysers can also improve the resilience of the energy system. They consist of multiple stacks – the modules in which electrolysis takes place. If one stack fails, the others continue operating. “It is similar to a wind farm,” says Andreas Peschel. “If one turbine goes offline, the remaining turbines continue generating electricity.”
Changing the regulatory framework would be an important step forward, but it would not be enough on its own. Although electrolysers are commercially available, they still need to become more flexible in responding to fluctuating electricity supply. They were originally designed for continuous operation; now researchers and manufacturers must adapt them to cope with the variable output of wind and solar power.
Batteries and hydrogen each have complementary roles to play. Batteries balance fluctuations over periods of a few hours, while hydrogen provides storage over many hours or even several days.
“If we adapt the regulatory framework and unlock the full potential of green hydrogen, these system-wide benefits can clearly outweigh the energy conversion losses associated with electrolysis,” says Andreas Peschel.
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