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Cities and Regions Support Ambitious EU Hydrogen Strategy

By July 7, 2020 9   min read  (1601 words)

July 7, 2020 |

The European Committee of the Regions (CoR) adopted its ” A road map for clean hydrogen – the contribution of local and regional authorities to a climate-neutral Europe “.

The European Committee of the Regions has adopted the opinion ‘Towards a Roadmap for Clean Hydrogen – the contribution of local and regional authorities to a climate-neutral Europe‘. The rapporteur is Birgit Honé (DE/PES), Minister for Federal and European Affairs and Regional Development of Lower Saxony. The opinion sets out a wide range of specific legislative and non-legislative measures for the development of a green hydrogen economy as a crucial building block of decarbonisation, in particular in the industry and certain transport sectors. Hydrogen currently accounts for less than 1% of Europe’s energy consumption and most of it is not produced through renewable energy sources.

The European Green Deal must be a key element of the post-COVID-19 recovery and green hydrogen a priority energy source to achieve climate neutrality. This was the key message following the debate on the clean hydrogen opinion, led by Birgit Honé (DE/PES), Minister for Federal and European Affairs and Regional Development of Lower Saxony.

Rapporteur Birgit Honé said: “Green hydrogen creates great opportunities for climate protection, value creation and employment in many European regions. We need more action at the EU level to accelerate the development of a hydrogen market. This is why we are calling for a European hydrogen strategy with a roadmap of dedicated measures. We are therefore very happy that the European Commission meanwhile has announced that it will adopt such a strategy in the coming days.”

The CoR strongly urges the European Commission to support the development and implementation of regional strategies and programmes for green hydrogen value chains and clusters, including an integrated roadmap of non-legislative and legislative measures for building an EU single market for green hydrogen and ambitious targets to drive production capacity. The opinion underlines the role of cities and regions as drivers of research and investment in this technology and calls for support of hydrogen projects at the regional regional.

The EU’s assembly of local and regional leaders has put forward the following economic and fiscal measures to boost green hydrogen. On the production side, members call for investment grants, feed-in premiums and guaranteed revenues. To foster demand, the CoR suggests binding blending quotas (e.g. for air and maritime transport fuels), GHG reduction quotas for fuel suppliers and CO2 thresholds for fleets (e.g. for lorries, coaches or inland shipping). Moreover, the CoR recommends considering Carbon Contracts for Difference (CCfDs) as a support measure.

Members request increased funding for green hydrogen projects both at research and at market roll-out level, notably from the Innovation and Modernisation Funds financed by the EU-ETS, the InvestEU programme, the European Structural and Investment Funds (ESI Funds), including Interreg and within the COVID-19 recovery Plan. The CoR calls for the European Investment Bank to provide considerable support for green hydrogen. Members agreed that a sustainability classification and mandatory certification for green hydrogen and e-fuels is needed in order to ensure the market uptake of green hydrogen.

Within the New Industrial Strategy for Europe, the CoR urges the Commission to promote lead markets for green hydrogen technologies and systems, especially in the steel, cement and chemical industries for which green hydrogen is a key option to achieve decarbonisation.

The EU’s assembly of cities and regions encourages the European Commission to create the legal framework for important projects of common European interest (IPCEIs) for green hydrogen and calls on Member States to use it for large-scale demonstration projects.

Members call for the development of an EU-wide hydrogen transmission system as a prerequisite for an impactful green hydrogen economy, and ask to revise the Regulation on trans-European energy infrastructure (TEN-E) and the EU Gas Directive accordingly.

The CoR urges the Commission to prioritise the use of green hydrogen and e-fuels to complement electric mobility in heavy-goods, public, waterborne and air transport as part of its announced strategy for sustainable and smart mobility.

Local and regional leaders support a revision of the Energy Taxation Directive to align energy taxation with the goals of the European Green Deal and calls on Member States to lower the tax burden on low-carbon electricity.

Members equally request a revision of the Renewable Energy Directive (RED II) as to raise the EU target for the share of renewable energy in gross final energy consumption, as they consider the dynamic expansion of renewable energy in electricity generation as the basis for the development of the green hydrogen market in the EU.

Cities and regions recommend EU Member States to promote a green hydrogen economy when updating their national energy and climate plans (NECPs) in 2023 and to work closely with local and regional authorities (LRAs) to deploy green hydrogen production.

The CoR calls for improving the financial endowment for the successor of the Fuel Cells and Hydrogen Joint Undertaking (FCH JU) so it can support more demonstration projects and cooperation with the European Hydrogen Valleys Partnership, a dedicated European association that includes over 30 regions in 13 European countries.

The opinion was adopted alongside a high-level debate on the European Green Deal, the EU’s growth strategy to reach climate-neutrality by 2050. On 15 June, the CoR launched the working group ‘Green Deal Going Local’. Composed of 13 local and regional elected representatives, it aims at converting the Green Deal into concrete projects and direct funding for cities and regions to deliver the sustainable transition on the ground.

The demands of the European Committee of the Regions at a glance:

  • The CoR urges the European Commission to support the development and implementation of regional strategies and programs for green hydrogen value chains and clusters and an integrated road map of non-legislative and legislative measures to build a single hydrogen market with ambitious targets for generation capacity of green hydrogen. The opinion emphasizes the important role of cities and regions in promoting research and investment in this technology and calls for support for hydrogen projects at regional level.
  • The Assembly of EU Regional and Local Representatives recommends various economic and financial measures to promote green hydrogen. To support generation, they are demanding investment grants, feed-in premiums and guaranteed proceeds. To generate demand, they recommend binding blending quotas (e.g. in air and maritime transport), GHG reduction rates for the placing on the market of fuels and CO2 fleet limit values ​​(e.g. for trucks, coaches or inland waterways) and as a further promotional measure so-called “carbon Contracts for Difference “(CCfD).
  • The members are calling for increased funding for green hydrogen projects in both the research and the market launch phase through the innovation fund fed by the EU ETS and the modernization fund, the “InvestEU” program, the European Structural and Investment Funds (ESI). Funds) including Interreg and as part of the post-COVID 19 crisis. The CoR also calls for significant green hydrogen funding from the European Investment Bank. The members agree that a sustainability classification and mandatory certification of green hydrogen / e-fuels is necessary to develop a market for green hydrogen.
  • They also call on the Commission to promote lead markets for green hydrogen technologies and systems and their use for climate-neutral production, particularly in the steel, cement and chemical industries, for which green hydrogen is one , as part of the implementation of the new industrial strategy for Europe is an important possibility of decarbonization.
  • It also encourages the Commission to create the legal framework for major projects of common European interest (IPCEI) for green hydrogen and the Member States to use it for large-scale demonstration projects.
  • With regard to an efficient green hydrogen economy, the members advocate building a system for the EU-wide transport of hydrogen and revising the regulation on the trans-European energy infrastructure (TEN-E) and the EU gas directive accordingly.
  • The CoR urges the Commission to prioritize the use of green hydrogen and e-fuels to complement electric mobility in the areas of heavy goods transport, public transport, shipping, and air transport as part of its announced strategy for sustainable and intelligent mobility.
  • Local and regional politicians support a revision of the energy taxation directive with the aim of harmonizing energy taxation with the objectives of the European Green Deal and reducing the tax burden on low-carbon electricity.
  • They call for a revision of the Renewable Energies Directive (EER II) and in particular an increase in the EU target for the share of renewable energies in gross final energy consumption because the dynamic expansion of renewable energies in electricity generation is the foundation of the market development of green hydrogen in the EU.
  • Cities and regions recommend that Member States include the promotion of a green hydrogen economy in the update of their National Energy and Climate Plans (NECP) in 2023 and work closely with local and regional authorities to expand green hydrogen production.
  • The CoR recommends that the successor of the Joint Undertaking “Fuel Cells and Hydrogen” (FCH JU) to build a European partnership and better equip financially more demonstration projects for green hydrogen in the EU, including in the framework of the ” European Hydrogen Valley Partnership support” to can, a European association that currently has more than 30 regions in 13 European countries.

After the opinion was adopted, there was a debate on the European Green Deal, the EU’s new growth strategy for achieving climate neutrality by 2050. The CoR working group “The Green Deal – Going Local” started on 15 June. It is made up of 13 local and regional mandate holders and has the mandate to convert the Green Deal into concrete projects and direct funding for cities and regions in order to make the local sustainability transition a success.

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