Italy Seeks Deal to Expedite Hydrogen Pipeline to Austria and Germany, Sources Say

(Reuters) — Italy is aiming to sign a letter of intent with Germany and Austria to speed up development of a more than 4-billion euro ($4.35 billion) southern pipeline for supplying hydrogen to central Europe, sources close to the matter told Reuters on Tuesday.

The administration of Giorgia Meloni has laid out plans to turn Italy into an energy gateway and last year it signed with Germany and Austria a joint letter for a hydrogen-ready pipeline between North Africa and Europe.

The European Union aims to produce 10 million metric tons and import 10 million tons of renewable hydrogen by 2030 in a bid to replace fossil fuels, which emit planet-warming gases when burned.

A group of companies including Italy's Snam is looking to build by the beginning of the next decade the SouthH2 Corridor pipeline, which would allow green hydrogen from the southern Mediterranean to reach European customers. It is unclear how much sooner Italy now wants to see the pipeline built under the letter of intent.

Green hydrogen, produced by splitting water through electrolysis using renewable energy, is included in the European Commission's decarbonization strategy for high-polluting industries and transports.

One of the sources, who declined to be named, said a three-page letter of intent was being drafted with the aim of accelerating the creation of the southern corridor and enhancing cooperation on the development of sustainable energy.

The parties will discuss the matter on the sidelines of a meeting of European energy ministers scheduled for Brussels on Thursday, two sources said, declining to provide further details as talks had not yet been finalized.

If signed, the letter of intent is expected to be submitted for review to the next European Commission, which will be appointed after elections to renew the European Union parliament scheduled for June, another source added.

Italy and Germany declined to comment. The Austrian energy ministry did not immediately respond to an emailed request for comment.

($1 = 0.9199 euros)

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