Algeria has a strong ambition to become a major player in green hydrogen, a clean energy source considered key to the energy transition. The country, rich in solar and wind resources, is leveraging these assets to develop a green hydrogen sector that is competitive internationally, particularly for exports to Europe. However, the realization of these projects still faces significant technological and economic challenges.

Structuring Projects Focused on Renewable Energies

At the forefront, Algeria is preparing to commission a 50 MW green hydrogen production plant in Arzew, co-financed by the European Union and Germany. This pilot project is part of a three-phase national roadmap aimed at a large-scale hydrogen economy. Key initiatives include the ALTEH2A alliance and the SoutH2 southern corridor, which aim to export several million tons of green hydrogen to Europe by 2030.

Economic and Technological Challenges

Despite its potential, green hydrogen remains approximately six times more expensive to produce than natural gas, Algeria’s current main energy resource. The costs associated with production, storage, and distribution are hindering the large-scale development of this energy source. Nevertheless, aware of the finite nature of its gas resources, Algeria is investing heavily – approximately USD 25 billion by 2040 – to build an integrated green hydrogen industry, encompassing everything from renewable energy production to derivatives such as green methanol and green ammonia.

Strategic Partnerships with Europe

Collaboration with European companies is a crucial component of this ambition. Sonatrach, the Algerian state-owned company, has signed several agreements with European groups to conduct feasibility studies and develop integrated green hydrogen production and export projects. These partnerships aim to establish a pipeline network to transport hydrogen to the European market, thereby strengthening Algeria’s position as a sustainable energy supplier.

Towards a Sustainable Energy Future

With a goal of exporting one million tons of green hydrogen by 2040, Algeria is part of a regional energy transition. While significant challenges remain, the political and industrial commitment is clear. Green hydrogen is thus seen as a strategic pillar of sustainable development, offering Algeria an opportunity to diversify its economy and play a key role in the fight against climate change.