Europe’s green hydrogen definition fires investment starting gun
The European Commission has published the Delegated Act, defining what constitutes green hydrogen, not only within the EU, but for those who seek to sell the clean fuel into the bloc.
The long-awaited law, which still needs to be approved by the European Parliament and the 27 member states, provides the certainty that many investors have been waiting for before signing off on green hydrogen projects in and around Europe.
The Delegated Act will also unlock EU green hydrogen subsidies that have been on hold until the legislation is passed.
An earlier version of the Delegated Act included strict rules on additionality that required the renewable electricity powering green hydrogen production to come from new, dedicated projects and not from existing capacity that would otherwise have been fed into the grid.
Those rules have been loosened, so that the renewable energy can come from projects that were commissioned up to 36 months before the hydrogen producing elements come online. Also, hydrogen projects that begin operating before the end of 2027 won’t have to adhere to the additionality rules until the beginning of 2038.
Another element of the original Delegated Act was the insistence that green hydrogen producers match the electricity they are using to produce hydrogen with renewable sources every hour in the event the wind stops blowing or the sun stops shining and they are forced to take power from the grid.
A stipulation of the European Commission’s Delegated Act is that the renewable energy being bought to power electrolysers must come from the same geographical “bidding zone”, usually the same country.
The latest iteration of the Delegated Act allows monthly matching until the end of 2029 when hourly matching will come into force. That means if power is taken from the grid, renewable energy can be bought to replace it within a month.
Another stipulation of the Act is that the renewable energy being bought to power electrolysers must come from the same geographical “bidding zone”, usually the same country.
In some cases, additionality will not be required, such as when there is a surplus of electricity being produced by existing renewable energy projects. Instead of the electricity being curtailed (i.e., turned off), as is the case today, it can be used to produce green hydrogen or ammonia.
Additionality rules also don’t apply when 90% of grid electricity came from renewables in the previous calendar year, or has an average emission intensity of less than 18 grams of CO2-equivalent per megajoule (64.8gCO2e/kWh).
That would mean Sweden, with an average carbon intensity last year of 28gCO2e/kWh and France, which has achieved 55-56gCO2e/kWh when a large proportion of its nuclear fleet is up and running, would qualify for producing green hydrogen directly from the grid. Norway is not in the EU, but with average carbon intensity of 30gCO2e/kWh would be able to export green hydrogen powered by its energy grid to the bloc.
Sweden (pictured: Stockholm), with an average carbon intensity last year of 28gCO2e/kWh and France, which has achieved 55-56gCO2e/kWh when a large proportion of its nuclear fleet is up and running, will in theory qualify for producing green hydrogen directly from the grid.
While not as sexy as the release of a new hydrogen-powered sports car or a breakthrough in electrolyser design, these rules are crucial for unleashing the billions of euros of investment the EU needs to reach its goal of 10 million tonnes of domestic green hydrogen production by 2030 and a further 10 million tonnes of imports.
Assuming the Delegated Act passes smoothy through parliament, investors will be able to pull the trigger on green hydrogen projects safe in the knowledge they meet the EU’s requirements.
The same goes for neighbouring countries, including the UK. Scotland, in particular, has plans to produce surplus hydrogen that can be exported to the EU. Developers now know what they need to do meet the EU’s criteria.
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