Germany’s hydrogen pipeline network is expanding at a pace far outstripping its ability to produce the fuel. By the end of 2027, the country will have nearly tripled its working hydrogen pipeline capacity to around 1,500 kilometers, even though its electrolysis capacity—the method used to generate hydrogen—remains minimal. At the start of 2026, Germany had just 181 megawatts of operational electrolysis capacity, far below its 10-gigawatt target for 2030.
This rapid expansion occurs despite a clear mismatch between supply and demand. Gas transmission operators had 537 kilometers of hydrogen pipelines operational by October 2025, with another 900 kilometers planned for completion in 2026 and 2027, according to the industry association FNB Gas. Most of the existing pipelines are converted natural gas lines, including a 400-kilometer stretch from Lubmin on the Baltic coast to Bobbau in Saxony-Anhalt, which was filled with hydrogen in December 2025.
The 9,040-kilometer core hydrogen network, approved in October 2024 at a cost of €18.9 billion, relies heavily on repurposed gas infrastructure. The network connects industrial clusters in the Ruhr region and eastern Germany to storage sites, ports, and import corridors. The second draft of the 2025 network development plan projects a 9,241-kilometer system by 2037, with total investment rising to €24 billion, 30% higher than earlier estimates due to rising material and construction costs.
The gap between pipeline capacity and production is growing. While shippers have been reserving transport capacity since March, those commitments, now totaling just under 6 gigawatts, have not yet materialized into firm offtake agreements. The 181-megawatt electrolysis capacity figure comes from an analysis by the Institute of Energy Economics at the University of Cologne, which also found that another 1.3 gigawatts of projects were either under construction or had reached final investment decisions. Even if all announced projects for 2030 proceed, capacity would only reach 8.7 gigawatts, with nearly 3 gigawatts of schemes already canceled or dormant.
Why Hydrogen Projects Stall
Delays are widespread. Shell’s 100-megawatt Refhyne 2 electrolyser at its Rheinland refinery only reached a final investment decision in July 2024, two years later than originally planned. High production costs, low buyer willingness to pay, and regulatory uncertainty are slowing progress. The state is stepping in to mitigate risks: if the network remains underused by 2055, the federal government will cover 76% of any shortfall, with operators responsible for the remaining 24%.
Barbara Fischer, managing director of FNB Gas, acknowledged the imbalance. “The network operators have delivered: the first pipelines are in the ground and industry is reserving transport capacity,” she said.
Germany’s Growing Reliance on Imports
Germany’s reliance on imports is already evident. Its 2024 import strategy projects that 50-70% of its 95-130 terawatt-hours of hydrogen demand by 2030 will come from abroad. Yet global supply remains constrained. The U.S. and China produce nearly all of the world’s 100 million tonnes of hydrogen annually, but both countries consume most of it domestically. Transporting hydrogen over such long distances is a separate challenge, as hydrogen liquefies at -253°C, just 20°C above absolute zero, the second-lowest liquefaction point of any element after helium.
The Wasserstoff-Kernnetz, Germany’s core hydrogen network, depends on a complex funding model to bridge the gap between construction costs and early revenue. The Bundesnetzagentur set a uniform ramp-up tariff of €25 per kilowatt-hour per year in July 2025, ensuring early users do not bear the full cost of an underutilized network. These fees feed into an amortization account, backed by a €24 billion credit line from the state-owned KfW bank, which will be repaid from surplus tariffs as hydrogen traffic increases.
