EU Defines Renewable Hydrogen as Electrolysers Required to Use New Renewable Electricity Production

The European Union has unveiled its official legal definition of renewable hydrogen, which requires electrolysers to be connected to new renewable electricity production. The announcement was made by the European Commission on Monday and outlined two detailed rules to define what constitutes renewable hydrogen in the EU. The key requirement is that all renewable fuels of non-biological origin, also known as RFNBOs, must be produced from renewable electricity. 

One of the specific provisions is “additionality,” which means electrolysers must be connected to new renewable electricity production, renewable energy production that began operations no more than three years earlier. This is to ensure that green hydrogen production does not cannibalize existing renewable energy generation and operates under newly installed capacity. 

The additionality clause applies to electrolysers directly connected to a renewable energy source that is not linked to the power grid. For those connected to the grid, developers and operators must produce their own renewable power or sign Power Purchase Agreements (PPAs) for renewable electricity. 

Previous drafts of the rules contained stricter guidelines for the timing of hydrogen output in relation to renewable energy production. However, the new rules have relaxed the restrictions, with a monthly correlation required until the end of 2029, and an hourly correlation required from the start of 2030. This allows for existing commitments and development to continue, while ensuring that stricter guidelines are imposed as the need for renewable energy and green hydrogen increases. 

The EU commissioner for energy, Kadri Simson, emphasized the importance of renewable hydrogen in the EU's strategy for a cost-effective clean energy transition and reducing reliance on Russian fossil fuels in some industrial processes. Clear rules and a reliable certification system are essential for this emerging market to establish itself in Europe. These delegated acts provide much-needed legal certainty to investors and will further boost the EU's industrial leadership in this green sector. 

There has been some confusion over whether the Delegated Act allows green hydrogen to be produced using nuclear power. While some news outlets have reported this, an analysis argues that these reports are based on a misunderstanding. The new clause in the document allows France to avoid the need for additionality in green hydrogen production in future years due to its low-carbon nuclear-dominated electricity grid. This means that while France may qualify to get around the additionality clause for its grid-connected green hydrogen projects, it cannot produce renewable hydrogen from new nuclear power. 

The EU's definition of renewable hydrogen is a significant step in establishing clear guidelines for the sector's development. The use of new renewable electricity production for electrolysers and the inclusion of additionality clauses will ensure that green hydrogen production does not undermine existing renewable energy generation. The relaxed restrictions on the timing of hydrogen output will allow for greater flexibility in the sector's development. The EU's commitment to renewable hydrogen is crucial to its strategy for a cost-effective clean energy transition and reducing dependence on fossil fuels.