Eurofer calls for proposed EU hydrogen regulation changes
An industry grouping including Eurofer has called on the European Commission to make changes to the draft RED II Delegated Acts relating to the regulatory framework for the EU hydrogen market, Kallanish notes.
With regards Article 27.3 (‘Additionality’ Delegated Act), the group of associations suggests prolonging the proposed transitional period and grandfathering to at least 2030. The current requirement represents a significant hurdle for the uptake of renewable fuels of non-biological origin (RFNBO) production. This is because the lead time for development of renewable electricity generation installations (RE) does not coincide with the time needed to construct an electrolyser. Moreover, energy intensive industries’ demand for RE is extremely high, the group explains in a joint statement.
It also wants to extend the geographical correlation beyond the proposed concept, provided there is sufficient or potential interconnection capacity between bidding zones. Moreover, it wants to set at least the proposed monthly time correlation as a default rule for hydrogen and derivatives production. A change to a more granular correlation should be subject to a corresponding Impact Assessment by the Commission.
With regards Article 28.5 (Greenhouse Gas Reduction Methodology), it proposes reconsidering restrictions on industrial CO2 use, and broadening the definition of possible CO2 sources limited by carbon pricing requirements.
The proposed sunset date of 2035 for the use of industrial CO2 sources would immediately lead to a halt in CCU investments today, as 13 years is not sufficient to recoup the investment costs for CCU, the statement explains.
The group also wants to allow recycled carbon fuels (RCFs) producers to use power purchase agreements (PPAs) and other measures to replace the electricity displaced by the production of RCF and RFNBO instead of national average grid GHG factors.
The GHG footprint of RCFs produced from industrial CCU applications, for example steel, using rigid inputs depends highly on the GHG intensity of the electricity grid. “Currently, only industrial RCFs produced in Member States with a very high RE share in their electricity grid can meet the 70% GHG emissions reduction threshold. To exploit the GHG reduction potential and the roll out of RCFs, fuel producers falling under draft para. 10(a) shall be able to use renewable PPA to replace the electricity lost due to the diversion of the rigid inputs from the original use,” the statement concludes.
Adam Smith Poland