The European energy landscape is undergoing its most profound transformation in decades. Two seemingly disparate developments—the proposed Trans-Mediterranean hydrogen corridor and Italy’s controversial nuclear revival—reveal the continent’s struggle to balance decarbonization goals with energy security imperatives. This complex puzzle involves technological challenges, geopolitical calculations, and competing visions for Europe’s energy future.
The SoutH2 Corridor: A hydrogen lifeline facing headwinds
The 3,300 km SoutH2 hydrogen pipeline project, stretching from North Africa to Germany’s industrial heartland, represents one of Europe’s most ambitious energy infrastructure plans. Recent high-level meetings between German, Italian, Austrian, Algerian and Tunisian officials have advanced the project, but significant obstacles remain:
Technical and economic challenges
- The pipeline’s estimated capacity of 163 TWh/year could supply 55 TWh to Germany alone, covering nearly 60% of its projected 2030 import needs
- Production costs remain prohibitive, with European Hydrogen Bank auctions revealing break-even prices between €5.8-13/kg
- Infrastructure requirements are staggering: Tunisia would need to increase its renewable capacity from current 3% to 35% of generation mix
Geopolitical complexities
- Algeria’s Energy Minister Mohamed Arkab has notably included blue hydrogen in his vision, maintaining options for fossil fuel-based production
- Tunisia’s energy minister skipped the recent Rome summit, signaling potential ambivalence about prioritizing exports over domestic needs
- The €2.2 billion Tunisian investment plan for grid upgrades faces implementation risks
Market skepticism
Industry leaders express growing doubts:
- Fortescue Energy CEO Mark Hutchinson warns: “If you’re waiting for someone to pay you extra because it’s green, forget it”
- Iberdrola’s Ignacio Galán notes fading momentum for hydrogen projects
- The first hydrogen auctions revealed subsidy requirements of €3.3-6.5/kg just to reach parity
Italy’s energy paradox: Nuclear revival amid hydrogen hopes
Italy’s energy strategy under Prime Minister Giorgia Meloni presents a study in contrasts—embracing both futuristic hydrogen imports and a controversial return to nuclear power after 35 years.
The hydrogen gateway strategy
As the natural bridge between North Africa and Europe, Italy is positioning itself as:
- Primary transit route for African hydrogen (SoutH2’s Italian section spans 1,200 km)
- Potential hydrogen production hub through Mediterranean ports
- Key player in REPowerEU’s import targets (10 million tons/year by 2030)
Yet Italy’s hydrogen roadmap lacks Germany’s precision:
- No clear domestic production targets
- Vague import commitments beyond transit fees
- Heavy reliance on private operators like Snam for infrastructure
The nuclear gambit
Meloni’s government is attempting to reverse decades of anti-nuclear policy:
- Proposal for 8-16 GW nuclear capacity by 2035 (11-22% of national demand)
- Focus on small modular reactors (SMRs) to overcome public resistance
- Requires overturning two referendum results (1987 and 2011)
The nuclear push faces formidable obstacles:
- 60% of Italians remain opposed in recent polls
- Geological risks in earthquake-prone country
- New dependencies on uranium imports (likely from Kazakhstan and Canada)
The persistent gas problem
Despite these ambitious plans, Italy remains trapped by gas dependence:
- 42% of electricity generation from gas (2023 figures)
- 70% of heating systems gas-powered
- 90% of gas imported (mainly from Algeria, Azerbaijan, and LNG)
The government’s “temporary” LNG expansion includes:
- Three new floating terminals
- Increased Algerian pipeline capacity
- Contracts with Qatar and Congo
Competing timelines, converging challenges
The hydrogen and nuclear strategies operate on different clocks:
Hydrogen timeline
- 2024-2026: Final investment decisions
- 2027-2029: Construction phase
- 2030-2032: First flows expected
Nuclear timeline
- 2024-2026: Legal/regulatory changes
- 2027-2030: SMR prototype development
- 2031-2035: First commercial units (optimistic projection)
This creates a dangerous gap where:
- Gas remains the bridge fuel
- Renewable growth (currently 9% annual increase) may not fill the gap
- Energy prices remain vulnerable to global markets
The geopolitical chessboard
North African dynamics complicate the picture:
- Algeria maintains parallel gas and hydrogen strategies
- Tunisia’s political instability threatens investment security
- Libya’s potential as future hydrogen player remains untapped
European divisions are equally telling:
- Germany’s single-minded hydrogen focus
- France’s nuclear-heavy approach
- Italy’s attempt to balance both
The coming years will test whether these parallel strategies can deliver genuine energy security or simply replace old dependencies with new uncertainties. With the 2030 REPowerEU targets looking increasingly precarious and nuclear timelines stretching into the 2030s, Europe’s energy transition appears more complex—and more uncertain—than ever.