More than 60 firms involved in the hydrogen sector have signed a letter to European Commission president Ursula von der Leyen raising concerns that the development of the hydrogen economy in the EU could be seriously impeded without revisions on rules for renewable generation.

Currently the EU’s ‘Fit for 55’ package delegates responsibility for rules on the production of renewable hydrogen from electricity to the Renewable Energy Directive (RED II).

But the requirements of RED II for renewable fuels to prove additionality—coupled with rules on the time and distance between renewable energy generation and its consumption in an electrolyser—could hinder investment in capacity, the letter says.

6GW – EU 2024 electrolyser target

These requirements are designed to ensure that hydrogen projects are powered by new renewable capacity, rather than those already existing on the grid, and to prevent hydrogen projects undermining progress towards renewable energy deployment targets.

But the letter’s signatories argue the rules are too stringent, and—if implemented—will seriously undermine the development of a hydrogen economy in the EU.

“We recognise the importance of additional renewable capacity. Yet, we consider there are simpler ways to guarantee this and believe it is highly discriminatory to hold solely hydrogen producers accountable to these criteria,” the letter says.

“This delegated act is a decisive factor determining whether the EU will achieve its Hydrogen Strategy 6GW target by 2024 and 40GW by 2030.”

Linking complexity

Complex permitting and rigid additionality criteria will make it very challenging to link large-scale hydrogen with large-scale renewable energy, due to the very different lead times of those two technologies, the letter adds.

“All the good work that we have seen here in Europe with the ‘Fit for 55’ package and everything else can now be torpedoed with the delegation act on additionality,” says Jon Andre Lokke, CEO of Nel Hydrogen, one of the signatories of the letter.

“This delegated act will decide whether hydrogen in Europe has a real chance to become a reality,” Aldag, Sunfire

The EU should instead phase in the requirements of the delegated act once the 6GW target of the EU Hydrogen Strategy is achieved, the letter argues.

The letter also recommends the EU reinforce the role of member states in providing additional renewable electricity capacity by setting dedicated targets and supporting simpler and faster national permitting procedures for renewable electricity generation and electrolyser installations. Renewable power-purchase agreements should also be promoted as key instruments to supply dedicated competitive renewable electricity to produce renewable hydrogen. And green hydrogen producers should be allowed to produce renewable hydrogen from electricity with existing renewable electricity plants as well as curtailed electricity to reduce the cost of production.

Campaign coordination

The letter and associated campaign has been coordinated by industry body Hydrogen Europe. Revisions to RED II are being discussed in the European Parliament’s Committee for Industry, Research and Energy. Discussions on the file have also begun in the Council of the EU.

When those two bodies reach a position, they will enter discussions with the Commission on the final shape of the law.

“This delegated act will decide whether hydrogen in Europe has a real chance to become a reality or whether it will shift to other geographies,” says Nils Aldag, CEO of electrolyser manufacturer and Hydrogen Europe member Sunfire.

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Author: Tom Young