As part of the preparation of EU legislation for the regulation of the European market for renewable and low-carbon gases, the Czech Presidency of the Council of the European Union submitted a second draft compromise to the Member States on Wednesday 23 November, introducing the possibility of counting hydrogen and low-carbon fuels towards the decarbonisation targets.
Under the new article proposed by Prague, EU countries would be able to include low-carbon fuels of non-biological origin, including low-carbon hydrogen, in the calculation of their targets for the share of renewable energy in industry and transport. Currently in the inter-institutional negotiation phase (‘trilogues’), these targets will be set by the revised Renewable Energy Directive (RED III).
The Czech Presidency is thus responding to a request made by eight Member States (France, Romania, Poland, Hungary, Slovakia, Bulgaria, Croatia and Slovenia) in a letter sent to the European Commission at the end of October (see EUROPE 13051/6).
However, the draft compromise states that low-carbon fuels “shall not be labelled, nor advertised, as renewable fuels”. Member States will therefore have to ensure that end consumers are provided with information enabling them to distinguish between the two, the Czech document says.
Hydrogen/fossil gas mixture
In addition to this new article, the Presidency proposes to lower from 5 to 2% the maximum level of hydrogen content that EU Member States would be obliged to accept in gas flows at interconnection points from 1 October 2025.
This change is intended to “reflect the fact that blending is not a preferred option among Member States with regard to the development of hydrogen infrastructure”, a Presidency document says.
Differentiated price discounts
Prague also suggests postponing the abolition of tariffs for access to hydrogen networks at interconnection points between Member States until 2036.
While the Commission’s proposal was to grant 75% rebates on tariffs at injection points to encourage the entry of renewable and low-carbon gases into the EU gas network, the Presidency distinguishes between rebates for renewable gases and those for low-carbon gases. These would be set at 100% and 75% respectively, according to its draft compromise.
The document also introduces the possibility for national regulatory authorities not to apply discounts or to set them at a lower level.
Postponement of the transition phase
Regarding the transition phase for the design elements of the hydrogen market, the draft compromise provides for a postponement to the end of 2035 (i.e. 5 years later than in the Commission proposal), in order to “reflect concerns that the hydrogen market will not be mature enough by 2030”.
Presented by the European Commission on 15 December 2021 (see EUROPE 12854/11), the new gas legislative package contains: - a proposal for a Directive on common rules for the internal markets in natural and renewable gases and hydrogen (recast of Directive 2009/73); - a proposal for a regulation on the internal markets for natural and renewable gas and hydrogen (recast of regulation 715/2009).
See the draft compromise on the directive: https://aeur.eu/f/4bz
The draft compromise on the regulation: https://aeur.eu/f/4c0 (Original version in French by Damien Genicot)