Green imports could slash Europe’s net-zero energy costs by €37 billion

A new study published in Nature Communications has revealed that Europe could significantly reduce the cost and scale of domestic infrastructure needed for a carbon-neutral future by importing green energy and energy-intensive materials like steel. The study, titled “Green energy and steel imports reduce Europe’s net-zero infrastructure needs”, explores a wide range of decarbonization scenarios and finds that importing certain energy vectors could cut system costs by up to 10%, while reducing pressure on land use, power grid expansion, and hydrogen pipeline networks.

The analysis integrates a global energy supply chain model with a European system model to assess the impact of importing electricity, hydrogen, ammonia, synthetic fuels, and materials like hot-briquetted iron and steel. The findings suggest that a strategically coordinated import strategy could offer Europe a more flexible, cost-effective, and geopolitically diversified pathway to net-zero emissions by 2050.

What are the economic and strategic gains of energy imports?

The study finds that importing green fuels and materials into Europe could reduce total annual energy system costs by up to €37 billion, representing a 4.4% savings over a purely self-sufficient pathway. These savings are achieved by optimizing imports of low-cost green hydrogen and its derivatives, such as methanol and Fischer-Tropsch fuels, from resource-rich regions like North Africa, South America, and Australia.

In scenarios where all import vectors are allowed and optimized, around 13% of Europe’s energy supply would be imported. This includes 50 megatons of green steel and nearly 1,500 terawatt-hours of synthetic fuels and hydrogen. The study also shows that even with varying technology assumptions (for the years 2030, 2040, and 2050) and ±20% fluctuations in import costs, the relative benefits of importing remain stable.

Critically, the research highlights that the first 500 TWh of imports deliver over half of the total potential cost savings, emphasizing diminishing returns with higher volumes. By importing green fuels early and in moderate quantities, Europe can reduce the need for expensive domestic investments without becoming overly dependent on external suppliers.

How do import options affect domestic infrastructure needs?

The type and volume of energy imports have a direct influence on the required domestic infrastructure. A self-sufficient European scenario demands extensive power-to-X (PtX) production capacity, large-scale renewables buildout, and a dense hydrogen pipeline network. In contrast, when imports are allowed, many of these needs are curtailed.

With imports optimized, the hydrogen pipeline length is reduced by 70%, and electricity grid expansion needs fall by 20%. Much of the reduction stems from importing energy-intensive products like steel and derivatives rather than the raw hydrogen itself. For example, if hydrogen is imported by pipeline into southern Europe and processed locally into fuels, the need for long-distance hydrogen transport is avoided.

Furthermore, the study shows that importing methanol and Fischer-Tropsch fuels provides nearly as much cost benefit as importing hydrogen directly. Ammonia and methane contribute smaller savings due to narrower applications and existing domestic sources. Steel and hot-briquetted iron imports are especially cost-effective, as they eliminate the need for domestic hydrogen-based steelmaking, which requires large quantities of renewable energy.

Electricity imports, while technically feasible via long-distance HVDC cables (e.g., from North Africa), are less attractive due to higher losses and variability. Even in scenarios where electricity import costs fall significantly, their contribution to cost savings remains marginal compared to chemical carriers.

What are the implications for policy, risk, and sustainability?

Energy import strategy is not merely a technical or economic choice, it is a strategic one that carries implications for energy security, climate resilience, and geopolitical risk. While imports offer significant benefits in reducing costs and domestic infrastructure demands, they must be balanced with considerations around supply chain resilience, public acceptance, and regional equity.

For example, shipborne imports of synthetic fuels and steel diversify energy sources and avoid rigid pipeline dependencies, which is crucial in a post-Ukraine-conflict geopolitical landscape. Meanwhile, retaining some domestic PtX capacity adds system flexibility, leverages waste heat for district heating, and utilizes low-cost biogenic or industrial CO₂ for fuel synthesis.

The authors also warn of constraints and uncertainties: the need for new port facilities, cost risks linked to investment conditions in exporting countries, and the ethical dimensions of shifting land and resource burdens to less developed regions. Moreover, the saturation effect, where increasing import volumes beyond 2,000–3,000 TWh yields limited additional savings, suggests that a mixed strategy will be most robust.