Belgium’s Parliament recently passed the Hydrogen Act, a comprehensive framework that governs the transport of green hydrogen through pipelines.
This landmark legislation is poised to reshape the nation’s energy landscape, bolstering its position as a frontrunner in the hydrogen economy. This article delves into the key facets of the Hydrogen Act, its objectives, technological implications, potential impact, and some of the challenges it faces.
On July 11, 2023, Belgium’s Parliament adopted the Hydrogen Act, marking a critical step towards establishing a dedicated regulatory structure for hydrogen pipeline networks. This forward-thinking legislation aims to foster the growth of the Belgian hydrogen market and transportation infrastructure. Its overarching goal is to position Belgium as a central import and transit hub for renewable hydrogen, serving North-Western Europe. Importantly, Belgium has taken the lead in this endeavor, pre-empting the EU gas market legislative revisions planned for late 2023 under the “Hydrogen and Decarbonized Gas Markets Package.”
The Hydrogen Act builds upon Belgium’s existing strengths in the hydrogen sector, leveraging its extensive pipeline network and expertise in the field. It provides a framework for numerous hydrogen projects slated to commence in mid-2026. While the Act focuses primarily on regulating hydrogen transport, it doesn’t encompass hydrogen supply, production, or distribution.
Designation of Hydrogen Network Operator (HNO): The Act mandates the appointment of a single HNO for the entire Belgian territory. This operator will oversee hydrogen transport infrastructure, network development plans, and commercial relations with users. This effectively monopolizes the operation of new hydrogen transport pipelines.
Roles of Independent Operators: Existing networks can retain their independence or transfer ownership and management to the HNO. Independent operators can manage their networks indefinitely under specific conditions, while the methodology for asset transfer value is yet to be developed.
Regulation by CREG: The Commission for Electricity and Gas Regulation (CREG) assumes the role of regulator, akin to its responsibilities in gas and electricity. CREG will establish the revenue framework and approve tariffs proposed by the HNO.
Quality Assurance: The Act prioritizes maintaining hydrogen quality during transport, allowing the HNO to propose quality standards, subject to ministerial approval.
Subsidies for HNO: To secure subsidies, the HNO must develop a robust business plan aligned with the National Hydrogen Strategy, demonstrating the need for the grant to reduce investment costs, among other requirements.
It’s crucial to recognize that the Hydrogen Act solely focuses on hydrogen transport. It doesn’t extend its purview to hydrogen supply, production, distribution, or hydrogen terminals and storage.
Division of Competences: Hydrogen’s unique position at the crossroads of federal and regional authorities presents uncertainties. Defining the boundaries for transport and distribution through hydrogen pipelines remains a complex task and could potentially jeopardize the Act’s validity.
Delegation of Special Powers: The Act grants executive authorities the power to abolish provisions that authorize network extensions. However, it lacks specificity regarding the exceptional circumstances justifying such actions, the duration of these powers, and their precise objectives. This vagueness could lead to concerns about potential abuse of authority and constitutional challenges.