Southeast Europe is increasingly positioning hydrogen as a critical component of its energy strategy, with countries like Greece, Romania, Croatia, and Serbia unveiling hydrogen roadmaps and pilot initiatives. These efforts are framed within the broader context of Europe’s decarbonization goals, which emphasize clean energy production, export potential, and energy autonomy.
However, a closer examination reveals substantial challenges tied to electricity requirements for hydrogen production. Each kilogram of hydrogen necessitates approximately 50–55 kilowatt-hours of electricity, indicating that the growth of hydrogen industries will lead to significant increases in power generation demand across the region.
The implications are profound for Southeast European nations, where electricity systems are relatively small compared to their Western European counterparts. To produce one million tonnes of hydrogen annually, an estimated 50–55 terawatt-hours of electricity is required—an amount that exceeds the total annual electricity output of several countries in the region. For instance, Romania generates around 55–60 TWh annually, while Greece’s output is similar. Croatia produces about 15–17 TWh, and Serbia’s generation fluctuates between 35–38 TWh.
This stark reality underscores why many hydrogen initiatives remain confined to pilot projects. While electrolysers can be deployed relatively quickly, establishing a reliable supply of low-carbon electricity necessitates extensive infrastructure development over several years.
The expansion of renewable energy sources such as wind and solar is essential to support the anticipated hydrogen production. However, these technologies require substantial land areas, grid capacity enhancements, and balancing mechanisms to manage their inherent variability effectively.
A typical 1 GW electrolyser facility, commonly referenced in European strategies, would generate approximately 180,000 tonnes of hydrogen per year, consuming about 8–9 TWh of electricity annually. Supplying this electricity would demand either 4–5 GW of solar capacity or around 2.5–3 GW of wind capacity, depending on local conditions.
Currently, few Southeast European nations have renewable portfolios capable of meeting such demands. Wind capacities remain modest across most Western Balkan markets, generally measured in hundreds rather than thousands of megawatts. Although solar capacity is growing rapidly, it still constitutes a minor fraction of total electricity generation.
The challenges extend beyond mere capacity; regional electricity grids are increasingly strained as renewable deployment accelerates. Existing transmission infrastructure designed for traditional thermal generation struggles to accommodate large volumes of variable renewable output.
This situation has led to recent policy discussions highlighting that renewable project pipelines may surpass the current electricity system’s ability to integrate new generation without additional balancing solutions or storage capabilities. Lengthening connection queues for solar and wind projects reflect ongoing efforts by system planners to maintain network stability.
The stability required for efficient electrolyser operation is at risk due to intermittent renewable output. This intermittency forces operators to either oversize renewable installations or rely on grid-supplied electricity during periods when renewables underperform—both options lead to increased system costs.
The economics surrounding hydrogen production are heavily influenced by electricity prices and availability. Electricity typically comprises the largest cost component in green hydrogen production; if costs hover around €30 per megawatt-hour, production could reach approximately €1.5 per kilogram. Conversely, if prices climb to €60 per megawatt-hour, production costs could double.
This price sensitivity presents competitive challenges against conventional fossil-based alternatives in industries with tight margins. In Southeast Europe specifically, where market dynamics often reflect regional price volatility linked to fossil fuel costs, securing stable low-cost electricity emerges as a crucial hurdle for hydrogen development.
This context explains why many strategies now prioritize locations with exceptional renewable resources: Greece’s southern regions benefit from high solar irradiation; Romania’s Black Sea coast offers strong wind potential; and Croatia’s Adriatic corridor combines both opportunities effectively.
Nevertheless, creating sufficiently large renewable clusters capable of supporting hydrogen facilities involves coordinated infrastructure investments. Expanding transmission networks to connect remote resources with industrial demand centers will be essential. Additionally, integrating cross-border electricity markets will be necessary to balance supply variability while scaling storage technologies will help stabilize renewable outputs.
The push towards hydrogen thus serves as a catalyst for broader transformation within the electricity system itself—highlighting gaps between current generation capabilities and what is needed for comprehensive industrial decarbonization.
The European Union aims for 10 million tonnes of domestic renewable hydrogen production by 2030, alongside an equal amount in imports. Meeting this domestic target could necessitate roughly 500–550 TWh of renewable electricity annually, which equates to about 20 percent of the EU’s total electricity generation.
Southeast Europe stands at a crossroads: it has the potential to become a significant supplier of renewable energy or hydrogen for Central European industries if substantial investments in generation, transmission, and storage infrastructures are realized. However, this transformation hinges on overcoming existing limitations within the region’s renewable capacity.
The ongoing development in hydrogen projects represents only a fraction of a much larger energy transition narrative—while electrolysers and industrial applications draw attention, the underlying transformation resides within the requisite electricity systems that support them.
The key takeaway for policymakers and stakeholders is clear: Hydrogen should be viewed not merely as an isolated technology or symbolic climate initiative but fundamentally as an integral part of an overarching electricity strategy essential for sustainable energy futures in Southeast Europe.
