02 Dec 2021

EU to Promote Global Hydrogen Markets

02 Dec 2021  by   
Ahead of a major reform of natural gas market rules, the European Commission today committed to promoting competitive markets to enable non-EU hydrogen to be traded internationally.

The commitment is part of the commission's new Global Gateway strategy, which offers investment of up to €300bn in the 2021-27 period for long-term international recovery. The commission will work with partner countries to develop their renewable hydrogen production and promote competitive markets to enable non-EU hydrogen to be traded internationally "without export restrictions or price distortions".

The commission did not give a clear figure on how much is earmarked for hydrogen, but noted €2.4bn worth of grants for Sub-Saharan Africa and €1.08bn for North Africa to support "renewable energy, energy efficiency, the just transition and the greening of local value chains".

Addressing EU Hydrogen Week, commission President Ursula von der Leyen this week promoted investing in Africa's hydrogen sector.

"Africa has the greatest untapped potential for renewable energy production. Turning clean energy into clean hydrogen could be a solution to store that energy, both to sell it abroad and to power Africa's rising industry," she said. Von der Leyen reiterated the EU's target of bringing the cost of green hydrogen to below €1.80/kg by 2030.

"This goal is within reach," she said.

The commission has also published a list of more than 600 hydrogen projects planned to enter operation by 2025, which it has assessed for greenhouse gas (GHG) emissions reduction, minimum size and project maturity.

Later this month the the commission is likely to propose major reforms to its 2009 third energy package aimed at boosting uptake of hydrogen in the bloc, including establishing a European Network of Network Operators for Hydrogen. The 260-page proposals also define low-carbon hydrogen as non-renewable, with a GHG reduction threshold of 70pc.

The commission's support for hydrogen came under criticism today from non-governmental campaign group Transport & Environment (T&E), which suggests EU mandates for green hydrogen by 2030 could increase power demand by almost 16pc of projected overall electricity demand. Increasing hydrogen production is "reckless", T&E said, because renewables could be diverted from the grid and undercut GHG savings from electric vehicles by increasing consumption of expensive natural gas.

T&E wants the European Parliament and EU members to lower the commission's proposed 2030 target for renewable fuels of non-biological origin (RFNBOs) to 1.6pc of all transport demand from the proposed 2.6pc. It said there are still no proposals from the commission for technical legislation defining key terms in the 2018 renewables directive (RED II), notably setting a GHG methodology for RFNBOs and defining "additionality" or the extent to which hydrogen and other RFNBOs come from new additional renewable generation.


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