European hydrogen legislation discussed at Hydrogen Act event

European hydrogen legislation discussed at Hydrogen Act event

Hydrogen Europe hosted several experts in the field of hydrogen today (May 26) to discuss the Hydrogen Act – a report that studies the creation of the European hydrogen economy.

During the event, several legislative factors were raised that both support and hinder the development of the hydrogen and allowed the experts to debate the most influential policies and legislations.

Presented by Jorgo Chatzimarkakis, the Secretary General of Hydrogen Europe, the initial presentation gave context to the Hydrogen Act.

The Hydrogen Act is sectioned into three different sections and two Acts: The Hydrogen Infrastructure Act and the Hydrogen Market Acts.

The kick start phase lasts from 2020 to 2025 with both acts focusing on fast-tracking initial projects that help Europe to achieve its one million tonne target by 2024.

During the ramp up phase, between 2025 and 2035, the infrastructure act will concentrate on blending hydrogen with natural gas, building hydrogen valleys and building a pan-European hydrogen backbone infrastructure.

The hydrogen market act, during this phase, will look to stimulate production of green hydrogen, increase demand for the low-carbon fuel source and create Guarantees of Origins (GOs) for acceptance into European markets and introduce production tariffs.

The final phase focuses on market growth running from 2035 to 2050.

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The infrastructure act will look to covert large parts of the natural gas infrastructure to support hydrogen whereas the market act will transition to a regular market for energy commodities.

It is believed that by implementing this hydrogen act it will help create a solution for the scale up of hydrogen and provide a successful economic market for the renewable fuel source.

Jorgo Chatzimarkakis remarked, “The EU has a unique opportunity to develop an economy in Europe as well as a blueprint for global hydrogen regulation.”

The most important factor to take into consideration is that the European hydrogen market will not be identical to the current natural gas market with it being crucial to not introduce policies or legislations that hinder the newly forming hydrogen market.

In addition to this, ensuring that not policies or legislations block potential investments is crucial to maintain the positive trajectory that the European hydrogen market is currently heading in.

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Chatzmarkakis details that a key aspect of the market growth phase is the possible integration of auctions that, as monetary policy support decreases, the hydrogen becomes much more competitive.

This makes the introduction of Guarantees of Origins (GOs) crucial with capable traceability to ensure how renewable the hydrogen is and can be placed in the competitive market.

Joao Galamba, Deputy Minister and Secretary of State for Energy of Portugal discussed the role that hydrogen auctions could have with hydrogen going to the highest bidders in the industry helping to generate a lucrative hydrogen market.

Galamba said, “We see the possible combination of price setting mechanisms and auctions as a possibility to achieve market growth.

“An auction mechanism will allow competitors to select consumers that are willing to pay more money to decarbonise using hydrogen.

“We want to do the same in this auction as we did in the solar auctions of 2019 to allow consumers to come forward.

“Whether we start with the chemical industry or another where hydrogen can play a significant role, it will be the market mechanism itself that decides.”

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