Home Hydrogen Dawn of European hydrogen market – is EU doing enough to support it?
To support the development of the European hydrogen market, the European Union (EU) has, among other activities, adopted a regulation and a directive establishing internal market rules for hydrogen and started work on a pilot mechanism that aims to accelerate investments. However, major European hydrogen companies claim that the EU also needs to require more “made in Europe” standards for the industry.
Courtesy of the European Commission; Photo by Mauro Bottaro
In its hydrogen strategy, the EU states that hydrogen is essential to achieving net zero greenhouse gas (GHG) emissions by 2050. Although renewable electricity is expected to decarbonize a significant proportion of the EU’s energy consumption by 2050, it won’t meet all energy needs. Hydrogen from renewable sources has the potential to fill this gap.
As per the European Commission (EC), there are 254 renewable hydrogen projects in the EU, of which 170 are in operation and 84 are under construction. Overall, approximately €18 billion has been invested in Europe from the Resilience and Recovery Facility, member states’ schemes and several regional and innovation programs to boost the first hydrogen production projects, support fuel switching and develop infrastructure.
Internal market rules for hydrogen
In May 2024, the Council of the EU adopted a regulation and a directive establishing common internal market rules for renewable and natural gases and hydrogen and reforming the existing EU gas legislation.
The Council claimed that the gas package sets out “solid” rules for the organization of the natural gas market and establishes a “strong” framework for the development of the future hydrogen market, including for dedicated hydrogen infrastructure. It contains specific rules for the transport, supply and storage of natural gas and hydrogen.
The new rules call for “integrated and transparent network planning across the EU, under the principle of ‘energy efficiency first’ and with a forward-looking approach,” the Council said, adding that gas and hydrogen network operators will prepare a 10-year EU network development plan.
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Posted: about 1 month ago
Accelerating hydrogen investments through a new mechanism
Under the adopted decarbonized gases and hydrogen package, the Commission started work on a new mechanism that aims to boost investments by providing a “clearer” picture of the market situation of both off-takers and suppliers and facilitating contacts between them.
The mechanism will collect, process and give access to information on demand and supply for renewable, low-carbon hydrogen and derivatives, allowing European off-takers to match with both European and foreign suppliers. Furthermore, it will collect and process market data on the development of hydrogen flows and prices.
The Commission revealed that a procurement process has started to find a service provider to develop an IT platform to operate the mechanism, adding that it plans to sign a contract by the end of 2024 so that it can start its operations by mid-2025.