The European Commission unveiled, on Wednesday 15 December, its new gas package aimed at gradually increasing the share of renewable and low-carbon gases and decreasing the share of fossil gas in the EU’s energy system.
As part of the European Green Deal, this initiative includes two proposals for revised legislation: - Directive (2009/73) on common rules for the Internal market in fossil gas; - Regulation (715/2009) on conditions for access to the fossil gas transmission networks.
Definition and certification of ‘low carbon gases’
The Commission has clearly chosen to retain the provisional definition of ‘low carbon’ gases and hydrogen provided for in the preliminary drafts of the texts previously detailed in our columns (see EUROPE 12839/4).
These are gases that produce at least 70% less greenhouse gas emissions than fossil gas over their full lifecycle.
In order to help consumers differentiate between the gases available, the Commission is also introducing certification rules for low carbon gas and its derivatives (see EUROPE 12839/4).
These would complement the certification scheme for renewable fuels and gases proposed in July as part of the revision of the Renewable Energy Directive (2018/2001) (RED II - see EUROPE 12762/8) and would apply to both imported and domestic production.
Reduced entry tariffs
In order to encourage the entry of renewable and low-carbon gases into the EU gas grid, the Commission is proposing to grant discounts of 75% on these entry tariffs.
It also proposes to abolish cross-border tariffs for such gas, including for entry and exit points to third countries, as of 1 January of the year following the adoption of the new regulation.
In addition, in the future, no cross-border tariffs will apply to the dedicated hydrogen network.
Limiting long-term contracts
The Commission also wants that no long-term contracts for supply of unabated fossil gas shall be concluded with a duration beyond the end of year 2049.
The objective: “Avoid locking Europe in with fossil natural gas and make more space for clean gases”.
Joint procurement of gas
At the request of some Member States particularly affected by soaring energy prices, the institution also proposes to improve the coordination of gas storage in the EU and to provide for the possibility of voluntary joint procurement of gas reserves.
According to the text presented, Member States will be able to set up a mechanism for the joint procurement of strategic stocks by transmission system operators, by notifying the Commission in advance of the purchase of a series of information such as the volume of gas planned for purchase or the anticipated costs and benefits.
If implemented, this mechanism should be open to all transmission system operators in the EU who wish to join and will be reported on by the Commission 3 years after the entry into force of the revised Regulation.
In addition, the Commission would like Member States to analyse their storage levels and potential security of supply risks in their common regional risk assessment. Where risks are identified, they should introduce possible countermeasures from a range of options such as minimum stockholding obligations and tendering.
A hydrogen market with dedicated infrastructure
In order to provide the EU with a competitive, open and dynamic hydrogen market by 2030, the institution proposes to apply traditional EU rules (based on lessons learned from the electricity and fossil gas markets) in a more flexible way until 2030, to establish an EU-wide 10-year network development plan and to set up a European Network of Hydrogen Network Operators (ENNOH).
Concerning the ‘blending’of fossil gas with hydrogen, the Commission has retained the approach proposed in the preliminary draft (see EUROPE 12839/4).
See the proposals for revision: https://bit.ly/3DZQOTj; https://bit.ly/3dR7Jgb (Original version in French by Damien Genicot)