Although green energy has matured, the low-carbon transition in heavy industry and transportation cannot rely solely on green electricity; it also requires hydrogen. On the 11th, the European Parliament passed new legislation confirming the gradual transition of the EU's natural gas market and infrastructure to hydrogen. This establishes a hydrogen market and hydrogen network to facilitate the low-carbon transformation of industries. The legislation still requires approval from the European Council before officially taking effect.

 

EU Commits to Hydrogen for Industrial Low-Carbon Transition

 

On the 11th, the European Parliament passed the hydrogen and decarbonised gas markets package, encouraging investment in hydrogen energy and accelerating the transition to sustainable energy sources such as biomethane and low-carbon hydrogen.

In a report by Euractiv, Member of the European Parliament Jens Geier stated that this marks 'the legal foundation for the development of the European hydrogen market and the gradual phasing out of natural gas.' Another MEP, Jerzy Buzek, mentioned that the future energy market will have two main sources - green electricity and green gas.

The EU's target is to reduce greenhouse gas emissions by at least 55% compared to 1990 levels by the end of 2030. According to 'Hydrogen Insight,' the EU has defined 'low-carbon hydrogen' and its derivatives such as synthetic methane. These types of hydrogen gas emit 70% less greenhouse gases during the production process compared to natural gas.

The European Commission proposed a hydrogen strategy in 2021. Geier pointed out that decarbonizing Europe's steel and chemical industries is not easy, and these industries will be a focal point for the development of the European hydrogen market.

 

Transformation of Natural Gas Transport Networks into Hydrogen Pipelines

In accordance with the EU's hydrogen energy plans, the current natural gas transmission network will gradually transition into a hydrogen transport network. According to Euractiv, the planning of the hydrogen network will be overseen by the newly established European Hydrogen Network Operator Network . Initially, ENNOH will collaborate with existing natural gas transmission operators to propose a ten-year plan by 2026. After 2028, ENNOH will independently manage subsequent projects.

 

This plan benefits from utilizing existing natural gas pipelines. However, some observers believe that a disadvantage is that it makes it difficult for the hydrogen network to develop independently. Some of the natural gas pipelines that are supposed to be phased out may try to become part of the hydrogen network, complicating the planning process.

 

According to Hydrogen Insight, the EU requires natural gas transmission operators to blend 5% hydrogen into their gas networks starting from October 2025. However, the proposal indicates that this hydrogen, along with renewable energy gases, will primarily be used for industrial decarbonization purposes rather than providing household heating.

 

Furthermore, to prevent monopolies in the hydrogen market, the new legislation also specifies that the infrastructure for hydrogen production, transport, and storage must be separated. For example, a company cannot simultaneously operate hydrogen production and pipeline transmission, and natural gas transmission operators are prohibited from simultaneously operating hydrogen infrastructure.

Reference:
*European Parliament（2024.4.11），MEPs approve reforms for a more sustainable and resilient EU gas market
*Euractiv（2024.4.11），Shift to hydrogen networks: EU Parliament adopts laws for new gas era
*Hydrogen Insight（2024.4.12），European Parliament approves hydrogen and low-carbon gas markets package, with focus on hard-to-abate industries
*European Commission，Hydrogen and decarbonised gas market package

 

Source: Environmental Information Center