The European Parliament voted on Wednesday to approve an amendment to green hydrogen production criteria that can significantly affect the industry.
Members of the European Parliament scrapped the “additionality” requirements in the Renewable Energy Directive II (RED II) that states all renewable hydrogen producers have to source electricity from dedicated green-energy projects, with grid-sourced electricity allowed only when it could be offset with dedicated supply within the hour.
Now the requirement has become less strict and instead allows the sourced electricity for the green hydrogen production to come from the grid, provided producers can verify it as green electricity by securing power-purchase agreements (PPA) from renewables installations for the equivalent amount. 314 MEPs voted in favor of the amendment and 310 against.
Hydrogen is considered “green” only if the power that goes into its production is sourced from renewable assets. This can also be done by directly connecting an electrolyzer and a renewable asset.
Under the additionality requirement, a renewable asset “comes into operation after, or at the same time as, the installation producing the renewable liquid and gaseous transport fuels of non-biological origin”.
This meant that only new renewable capacity could be used to produce green hydrogen, a point in the directive that prevented hydrogen producers from potentially signing a renewable power purchase agreement with existing renewable assets.
However, Amendment 13 does not include an additionality principle and no such criteria will apply to producers of renewable fuels of non-biological origin (RFNBO) from now on.
The Renewable Energy Directive II also includes new targets for RFNBOs like green hydrogen and green ammonia. They are now set to become 5.7% of all fuels by 2030, including 1.2% in maritime fuels and 50% of industrial fuel use by 2030, rising to 75% by 2035.
According to trade body Hydrogen Europe, this will require nine to ten million metric tons of green hydrogen.
Markus Pieper, the rapporteur responsible for the revision of the directive, commented on the vote saying “we have ensured that [the criteria for hydrogen production] doesn’t become excessively complicated… We have sent a message to the commission, that you do not need to make the energy transition so complicated, so expensive. We don’t need gold-plated hydrogen. We need hydrogen now.”