After reaching agreement on the gas package directive (one directive, one regulation) on 27 November (see EUROPE 13302/7), the Council of the EU and the European Parliament finally managed to reach agreement on the regulation, on Friday afternoon 8 December, aimed at facilitating the penetration of renewable and low-carbon gases into the energy system, in particular hydrogen and biomethane.
“For the first time in history, we are creating a legal framework for hydrogen in the EU energy market. We are building a completely new energy market model in the EU, based primarily on electricity and green gas”, said a delighted Jerzy Buzek (EPP, Polish), Parliament’s rapporteur.
Before the start of this final negotiating session, three important points were still on the table: the issue of governance, the aggregation of demand, particularly for hydrogen, and the target for biomethane production.
Governance
On governance, the position of the European Commission and the Council of the EU prevailed, with the creation in 2024 of an independent entity for the planning of European Network of Network Operators for Hydrogen (ENNOH), which would not be fully operational until January 2027.
This means that ENTSO-G, the European Network of Transmission System Operators for Gas, and ENNOH will have to work together between 2024 and January 2026. ENTSO-G's next 10-year network development plan (TYNDP) and the next list of projects of common interest (PCI) for 2025 and 2027 will be drawn up jointly by ENSTO-G and ENNOH, under the supervision of the Commission.
Demand aggregation
The co-legislators then reached agreement on the extension of the demand aggregation and group purchasing mechanism for gas, adopted during the energy crisis, on a voluntary basis, for gas companies. Hydrogen could be included in this mechanism, for the time being, in the form of a multi-year pilot project.
Biomethane
In the end, Parliament’s target for biomethane production will not be included in an article of the regulation, but only in a recital.
Gas from Russia and Belarus
The Regulation also introduces provisions enabling Member States to adopt restrictions on the supply of natural gas, including liquefied natural gas (LNG), from Russia or Belarus, “in order to protect the essential security interests of the Member States or of the EU”, says a press release from the Council of the EU.
Solidarity
Where bilateral agreements are not in place between two Member States, default provisions are introduced to make the principle of solidarity operational in the event of a crisis.
A cross-border conciliation mechanism will be set up for a posteriori review of compensation, voluntary reduction of non-essential consumption by protected customers and guarantees for cross-border flows.
Through a voluntary mechanism, a Member State will also be able to supply volumes of gas to another Member State with which it is not connected and which requests solidarity, by applying market-based measures.
Rates
With regard to network tariffs for the hydrogen market, the co-legislators agreed that each national regulatory authority should consult neighbouring national regulatory authorities on the draft tariff methodology and submit it to the Agency for the Cooperation of Energy Regulators (ACER). It will be up to each national regulatory authority to set its own tariff.
“In addition, at the request of a national regulatory authority, ACER may propose solutions by means of a non-binding factual opinion. ACER will also inform the Commission of the outcome of this request”, explains the Board’s press release.
For the shadow rapporteur, Marie Toussaint (Greens/EFA, French), “this text misses the necessary step towards ending our dependence on gas by not proposing any date or plan for phasing out fossil fuels. Furthermore, it gives a blank cheque to the potentially excessive development of hydrogen, without restricting it to 100% renewable criteria”. (Original version in French by Pauline Denys)