The EU Commission hopes to advance its goals for supply security, independence from Russian fuel sources, and ambitious climate targets via the REPowerEU program. The initiative’s main goals are to boost renewable energy development and expedite the hydrogen market’s growth.
Nonetheless, the proposed delegated act, which establishes the future game rules for European hydrogen generation, severely undermines these lofty objectives. Instead of speeding up the use of hydrogen, the rule imposes unneeded restrictions.
The delegated act provides that, after a brief transition time, only energy from newly constructed, unsubsidized wind and solar facilities can be used to create green hydrogen by 2026. Even if the planning and licensing processes for new wind and solar power facilities were to be hastened in the future, green hydrogen production in considerable quantities would not be achievable until 2030.
The idea that electrolyzers can only make hydrogen when new wind and solar farms are producing power virtually simultaneously is also problematic. Electrolysers would have to sit idle during any lengthy quiet time due to this temporal link. As a result of the more complex procedures, the price of hydrogen would rise unnecessarily, making it nearly difficult to assure a constant supply to industry.
What is meant to be acceleration is instead slamming on the brakes. There is no direct linkage of generation from directly assigned renewable plants in other areas, such as electric mobility. Furthermore, from the standpoint of the energy business, this technique is completely superfluous, because emissions trading regulates CO2 reductions and assures that CO2 emissions are restricted to the available number of permits.
Companies are willing to invest billions of euros to make the transition to green hydrogen a reality. Many industrial firms desire to transform their manufacturing processes. However, they must have confidence that green hydrogen will be supplied as soon as feasible, in adequate quantities, and at a fair price. As a result, the industry has recently developed a number of positive recommendations for leveraging headroom when it comes to green hydrogen demand.
If Europe is to meet its ambitious climate goals, it will require a completely different strategy going forward: there should be no restrictions on the use of power by makers and consumers of green hydrogen. Instead, member states should include the additional electricity needed to ramp up electrolyzer capacity in their national renewable energy objectives. There would be no need for more proof from the green energy community. The present reform of the Renewable Energy Directive (RED II) provides a chance to do so, and if implemented, will allow hydrogen’s potential to be fully realized.
