Arturo Gonzalo Aizpiriz became CEO of Enagás, the operator of the Spanish gas network, on March 22, 2022. Just two days later, Russia invaded Ukraine, unleashing a war that has lasted until today and has caused the biggest crisis of the gas sector in modern history.
In the midst of the energy storm, this doctorcum laude in Chemical Sciences has made time for his other great passion, history and archaeology, and has published the book In the footsteps of Hannibal. In this interview, he points out that the green hydrogen objectives will have to be met in half the expected time and that they will seek to produce a ton of green hydrogen at three euros per ton, which will mean less than half the current cost.
How much and how did the war change the challenges you faced when you agreed to be CEO of Enagás?
Coinciding almost with my arrival at Enagás, there was a sudden and profound change in the energy environment in Europe. The war in Ukraine shows one of its weaknesses, and since then it has been given an absolute priority in the Repower EU document, which came to light on March 8 with surprising speed for European times, the security of energy supply and the need to accelerate decarbonization. At that time, I understand that this is exactly what Enagás has to dedicate more and more to and these are the basic elements of the company's new purpose that we reflected in the strategic plan that we presented on July 12. Our raison d'être is to contribute to security of supply and decarbonisation in Spain and Europe. In these ten months we have taken very clear steps in that direction from our company.
One of the keys to that European policy and the measures approved by the Spanish Government were savings measures. Do we approve?
In Spain, a very significant reduction of 15% has been achieved in conventional use (that of families and companies). Largely due to the mild temperatures in recent months, but more has been spent on electricity production, so the total reduction has been lighter, although offset by a 5% increase in exports. In any case, there is a change in habits that makes us think that savings in households and companies will be structural. Not so much in the large industry, especially the electro-intensive, which has used alternative fuels to gas and, when its price drops, will consume it again.
What do you think of the gas cap agreed in Europe?
The fact that an agreement has been reached on this issue is very positive because it is a joint response from Europe to a matter in which each country has its peculiarities and the role that the Government of Spain has played in making it possible is very relevant. In this context, it is key to have competitive energy for industries, but also for homes.
Brussels has warned of the risk that the lack of gas supply by 2023 could cause blackouts. Do you share that concern?
In the circumstances that we can anticipate today regarding the behavior of the market, Spain should not have any concerns because we have an infrastructure that gives us enormous peace of mind. Of course, always without forgetting that we are part of Europe and, in addition to meeting our own needs, we have to contribute to guaranteeing those of other countries as much as possible, as we are already doing. These days it has been news that the first ship that has carried liquefied natural gas (LNG) to a floating regasification plant in Germany has been a ship that has loaded in Spain.
With the Russian gas tap turned off, many experts doubt that there is enough gas in the rest of the planet to make up for what Europe consumes. Will we witness a shortage of this fuel in the world?
It all depends on the harshness of winter in Europe. If it is milder than expected, as is happening up to now, the Central European countries and especially Germany will spend less on heating. A lot will depend on that at what level storages remain in Europe. Another key factor is China. Its zero covid policy has greatly reduced activity and, therefore, the demand for LNG in the world. That has also given Europe a breather. Its demand is not likely to return to normal for a long time.
In this transition in which gas is still going to continue with a strong role, does the strong commitment to infrastructures such as H2Med, dedicated exclusively to the transport of hydrogen, make sense?
The H2Med is part of a public policy commitment as large-scale energy planning should be. A public policy with a regulatory framework that makes it possible and a private interest that ensures the demand for these volumes and eventually the economic viability of the infrastructure. In the RePower EU, the commitment to hydrogen was already identified.
How is H2Med going to be financed, beyond the aid requested from Europe?
Until now, what has been requested is that Brussels grant it the qualification of a project of common interest. When this happens, this financing may be requested, which, according to the regulations, will be between 30% and 50% of the total cost. Added to this is a public call for future consumers of that hydrogen to come to commit to acquiring minimum consumption and thus be able to carry out a project with insured consumption. Finally, there will be the tolls that are paid for the use of the infrastructures, which can represent a very significant amount of financing. What I can assure you is that Spanish consumers are not going to pay a penny for this infrastructure.
The Government has also presented to Europe a project for a national gas pipeline network. But the funding requested is unknown.
What has been submitted is the request for a declaration of a project of common European interest for the design of the trunk network, something like the backbone of hydrogen within Spain. These hydrogen pipelines are going to transport only hydrogen, but there are no economic data because now we have to evaluate how many kilometers of the current gas network we can take advantage of for that hydrogen network.
Any approximation?
At the moment, we have 900 kilometers of duplicated gas network. Areas where a gas pipeline was built first, it was too small and another was built next to it. Those are clearly to be taken advantage of. We must analyze the rest and it will be then when data on the investment necessary for its adaptation will be offered. The only data that we have provided is that of the submarine connection between Barcelona and Marseille, which will cost 2,500 million euros.
Do we run the risk of investing in unusable infrastructures because then competition will come from other countries that can offer more competitive green hydrogen?
North African countries such as Algeria or Morocco will have a fundamental role in the hydrogen market, but that will take a while. In Spain, technology is more advanced and we have committed to supplying the European Union with 2% of its hydrogen needs in 2030. This is two million tons, so it will force us to make a very important effort to produce for our supply and have a surplus to export that year. You have to accelerate hard to reach compliance. Europe must produce in the next 10 years the objectives planned for 20. More than the competition from other countries, what worries us now is the subsidy that the US gives to the production of hydrogen, which is three dollars per ton. And we are trying to be able to produce at this cost in the EU, at three dollars per tonne.
