Monday (February 13) saw the Commission propose rules for the definition of renewable hydrogen with two Delegated Acts, after three years of work.

Read more: European Commission proposed regulation for renewable hydrogen definition

One of the Acts mandates that renewable fuels of non-organic origin (RFNBOs), including hydrogen, can only be produced with additional renewable power plants during the hours that the renewable energy asset is producing electricity and only in the area where the renewable electricity asset is located.

While the second Act offers methodology for calculating lifecycle greenhouse gas (GHG) emissions for RFNBOs, taking into account upstream emissions, emissions associated when taking electricity from the grid, processing, and transporting.

Hydrogen will also be considered renewable when the emission intensity of electricity used is below 18g C02e/MJ. Electricity taken from the grid can be considered fully renewable, opening the door for nuclear hydrogen. Criteria for temporal and geographic coloration will apply.

Coming as what many have hailed a landmark moment for the European Hydrogen industry while others claim the stringent rules will make hydrogen more expensive, players across the energy market have been reacting to the legislation.

“A far-from-perfect regulation is better than no regulation at all,” said Jorgo Chatzimarkakis, CEO of Hydrogen Europe. “At last, there is clarity for industry and investors and Europe can kick-start the renewable hydrogen market.”

The Hydrogen Europe CEO added that the Acts come at a critical time, with the US setting a “very high benchmark” with its production tax credits for clean hydrogen production under the Inflation Reduction Act.

Read more: Win for hydrogen in the US – Inflation Reduction Act to become law

However, the industry association said, “These strict rules can be met but will inevitably make green hydrogen projects more expensive and will limit its expansion potential, reducing the positive effects of economies of scale and affecting Europe’s capacity to achieve the goals set in RepowerEU.”

Hydrogen Europe added that the role of governments will be “crucial” in supporting the hydrogen sector and closing the price gap between renewable and conventional hydrogen.

Earlier this month (February 1), the European Commission unveiled its Green Deal Industrial plan, with intentions to offer green hydrogen producers a subsidy programme.

Read more: European Commission plans to subsidise green hydrogen production

Dilara Caglayan, Senior Associate for Hydrogen at Aurora Energy Research said the Delegated Acts came as a “very positive sign” for the EU’s hydrogen ambitions.

“In general, the Acts are more lenient than previous proposals, signalling that the EU supports the hydrogen market and have listened to feedback following the previous Delegated Act,” Caglayan said.

She noted that a key addition of the Acts is that grid electricity, provided its carbon intensity is below 18g CO2e/MJ, can be used for hydrogen production. Saying, “an electrolyser doesn’t need to be connected to a new renewable energy source asset to be defined as producing renewable hydrogen. In other words, there is now scope for producing renewable hydrogen from existing/old renewable energy source assets.”

Nils Aldag, CEO of Sunfire GmbH, a German electrolyser manufacturer on LinkedIn said, “The adoption of the RED II Delegated Acts by the European Commission is a big step for the European hydrogen industry, as it brings us closer to a clear and predictable regulatory framework for green hydrogen.”

Aldag added that the Acts will help unlock investment decisions for electrolysis project which “lacked regulative clarity until now.”

Alternatively, NGO, Global Witness dubbed the draft rules as a “gold standard for green washing,” saying the Acts allow for green hydrogen to be made with electricity from coal or fossil fuel power plants. 

Dominic Eagleton, Senior Gas Campaigner at Global Witness, said, “The European Commission’s plan to make so-called ‘green’ hydrogen with electricity from fossil gas or coal power plants is surely the gold standard of greenwashing.”

Eagleton added, “Plans to swap out the fossil gas in Europe’s pipes and boilers with hydrogen from renewables simply will not work – there’s not enough of it to go around. So instead of admitting defeat, the Commission has gone into denial. The only way to replace gas is to roll out a massive wave of renewables and energy savings.”

Despite the mixed reaction to the proposed Acts, the overall feeling is that this seems to be an important step for European hydrogen in terms of adding clarity – albeit potentially imperfect. It is yet to be confirmed whether these rules will come into force, with the European Parliament and Council now set to scrutinise the legislation for a maximum of four months – with no option to amend the Acts – ahead of deciding to accept or reject.