Across Southeast Europe hydrogen has become a recurring theme in government energy strategies. Countries from Greece to Romania, Croatia and Serbia have announced hydrogen roadmaps, pilot projects and industrial partnerships. In policy documents the fuel is often presented as the next step in Europe’s decarbonisation trajectory, promising clean industry, export opportunities and energy independence.
Yet once the underlying electricity requirements are examined, the scale of the challenge becomes clearer. Hydrogen production is fundamentally an electricity conversion process. Every kilogram of hydrogen produced requires roughly 50–55 kilowatt-hours of electricity, meaning the expansion of hydrogen industries inevitably translates into massive new demand for power generation.
For Southeast Europe, where electricity systems remain relatively small compared with those of Western Europe, this requirement transforms hydrogen strategies into something much larger: regional electricity expansion programmes.
The arithmetic is straightforward. Producing one million tonnes of hydrogen annually requires approximately 50–55 terawatt-hours of electricity. To put this figure in context, several countries in Southeast Europe produce less electricity than this in total each year.
Romania generates around 55–60 TWh annually, Greece approximately 55–60 TWh, while Croatia produces roughly 15–17 TWh. Serbia’s generation fluctuates around 35–38 TWh depending on hydrological conditions.
In other words, producing one million tonnes of hydrogen would require electricity equivalent to the entire annual generation of a mid-sized national power system in the region.
This reality explains why many hydrogen initiatives appear ambitious yet remain limited to pilot projects. Electrolysers can be installed relatively quickly, but supplying them with low-carbon electricity requires years of infrastructure development.
Renewable generation must expand significantly to support hydrogen production. Wind and solar power are the most likely sources of electricity for green hydrogen, yet these technologies require large land areas, grid capacity and balancing mechanisms to manage variability.
Consider a typical 1 GW electrolyser facility, often cited in European hydrogen strategies. Such a plant would produce approximately 180,000 tonnes of hydrogen per year while consuming around 8–9 TWh of electricity annually.
Supplying that electricity would require either 4–5 GW of solar capacity or roughly 2.5–3 GW of wind capacity, depending on local resource conditions.
Few Southeast European countries currently possess renewable portfolios at this scale. Wind capacity in most Western Balkan markets remains measured in hundreds rather than thousands of megawatts. Solar capacity is expanding rapidly but still represents a relatively small share of total electricity generation.
At the same time regional electricity grids face growing constraints as renewable deployment accelerates. Transmission infrastructure built around traditional thermal generation often struggles to integrate large volumes of variable renewable output.
Recent policy debates in several countries illustrate this challenge. Grid operators have begun warning that renewable project pipelines exceed the current ability of the electricity system to absorb new generation without additional balancing capacity or storage solutions. Connection queues for solar and wind projects have lengthened as system planners attempt to maintain network stability.
These constraints matter greatly for hydrogen production. Electrolysers require stable electricity supply to operate efficiently. Intermittent renewable output complicates this requirement, forcing operators either to oversize renewable generation or to draw electricity from the grid during periods of low renewable output.
Both options increase system costs. Oversized renewable clusters require additional land, transmission infrastructure and investment. Grid-supplied electricity risks undermining the low-carbon credentials of hydrogen if it originates from fossil-fuel generation.
The economics of hydrogen production therefore depend primarily on electricity price and availability. Electricity typically represents the largest cost component of green hydrogen. If electricity costs €30 per megawatt-hour, hydrogen production might reach approximately €1.5 per kilogram. If electricity costs rise to €60 per megawatt-hour, production costs double.
At higher electricity prices hydrogen struggles to compete with conventional fossil-based alternatives, particularly in industries where margins remain tight.
For Southeast Europe, where electricity markets are often influenced by regional price volatility and fossil-fuel generation costs, securing stable low-cost electricity becomes the central challenge for hydrogen development.
This is why many hydrogen strategies now focus on locations with exceptional renewable resources. Greece’s southern regions offer high solar irradiation. Romania’s Black Sea coast provides strong wind potential. Croatia’s Adriatic corridor combines both wind and solar opportunities.
Even so, developing renewable clusters large enough to supply hydrogen facilities requires coordinated infrastructure investment. Transmission networks must expand to connect remote renewable resources to industrial demand centres. Electricity markets must integrate across borders to balance supply variability. Storage technologies must scale to stabilise renewable output.
Hydrogen therefore acts as a catalyst for broader electricity system transformation. It exposes the gap between current generation capacity and the scale required for deep industrial decarbonisation.
This perspective helps explain why European hydrogen policy often appears simultaneously ambitious and uncertain. The European Union has set a target of 10 million tonnes of domestic renewable hydrogen production by 2030, alongside 10 million tonnes of imports. Achieving this domestic target alone would require roughly 500–550 TWh of renewable electricity annually, equivalent to about 20 per cent of the EU’s total electricity generation.
For Southeast Europe the implications are particularly significant. The region could become an important supplier of renewable electricity or hydrogen to Central European industry if large renewable resources are developed. But such a transformation would require unprecedented investment in generation, transmission and storage infrastructure.
Hydrogen projects therefore represent only the visible tip of a much larger energy transition. Electrolysers and industrial applications capture public attention, but the real transformation lies in the electricity system required to support them.
For policymakers and investors the lesson is clear. Hydrogen should not be treated as a standalone technology or a symbolic climate initiative. It is fundamentally an electricity strategy. The success of hydrogen initiatives will depend less on electrolysis technology and more on the scale, cost and reliability of the electricity systems that power them.
Until Southeast Europe’s renewable electricity capacity expands dramatically, hydrogen ambitions will remain constrained by the same reality faced by every energy transition project: the need for vast amounts of affordable electricity.
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