EU | Nel Hydrogen

Unlocking the potential of renewables

Renewable hydrogen is a gamechanger across applications and markets.

The fundamental challenge with renewable energy, is that it follows its own cycles and logic, independent of when we wish to use it. So, we need a way to harness and utilise it to its maximum potential and store excess energy.

The development of renewable hydrogen opens new business opportunities for players in the energy space and gives our planet a real chance to fully phase out the use of fossil fuels, decarbonize our economies and to live in a world where global warming is limited to below 1.5 degrees Celsius.

Policy positions

Key recommendations

Renewable Energy Directive (III) Revision

Maintain binding 50% renewable hydrogen target in industry

- Our industry needs clear demand signals to give business and investor certainty moving forward.
- An intermediary target of 30% renewable hydrogen in industry in 2026 would give further clarity and a clearer trajectory towards the 50% target.

Provide clarity ASAP on the RED II delegated 8 act for additionality, geographic and temporal correlation

A workable and realistic framework is needed. Without clarity on the accounting rules and what counts as renewable hydrogen, there can be no clarity on renewable hydrogen targets.

Ensure the existence of a coherent and consistent certification scheme, recognisable on a global level.

- At present. there are too many competing certification schemes with different methodologies being used and developed to scientifically determine and calculate the greenhouse gas (GHG) emissions and life cycle assessment (LCA) of hydrogen.
- Efforts ought to be streamlined on a global level to avoid distortion of the future hydrogen market. A global standard is required to promote a global hydrogen economy.

Mobility

Alternative Fuels Infrastructure Regulation:

Maintain targets defining minimum distance requirements between hydrogen refuelling stations: every 150km on the core network and urban nodes.

Trans-European Networks for Transport Regulation (T EN-T):

Support synergies between the TEN-T and Trans-European Networks for Energy Regulation. This will enable cross border flows of hydrogen as an energy vector, the decarbonization of the energy grid whilst facilitating the decarbonization of Europe's transport sector on the road, at sea and in the air.

Sustainable Aviation Fuels Regulation & FuelEU Maritime

Set common minimum standards, and allow member states to set more ambitious targets, both at domestic and international level, while ensuring that high minimum levels set forth in the regulation are met.

EU funding

A dedicated EU fund for electrolyser manufacturing

National & European schemes should focus on reducing investment risk and on establishing the serial production of electrolysers in a manner that supports technologies that are scalable and cost effective. Electrolyser manufacturers should benefit from the same support afforded to other energy infrastructure categories in the past. A dedicated fund for electrolyser manufacturing would contribute towards accelerating the upscaling of manufacturing capacities.

State Aid

The European Commission should consider making technology suppliers legally eligible for assistance via state aid exemptions if they support & facilitate investment activities contributing to EU climate objectives and the REPowerEU ambition.

A role for the European Investment Bank (EIB)

- The EIB should envisage a mechanism for a fast-track procedure with regards to the approval process for loans at favourable rates for investments into hydrogen infrastructure (as defined in TEN-E).
- Grants should also be duly considered with regards to feasibility and FEED studies.

Emissions trading scheme (ETS) and carbon tax

- Free allowances should be re-invested into technologies that contribute towards achieving the objectives of the EU Green Deal.
- Should ETS reform not trigger the desired shift to green technologies, policy makers should consider adding hydrogen to the list of products carbon border adjustment mechanism to ensure a level playing field for renewable hydrogen.
- The ETS Innovation Fund application process should be clarified & simplified to facilitate access to financing for manufacturers.
- Carbon contracts for difference scheme (CCFD) must be accelerated, with CCFD's being applied on the end-user side.

Hydrogen & Decarbonization of gas markets package

Definitions

Clarity is needed with regards to the definitions of renewable and low carbon hydrogen and their GHG footprint. Proposing a delegated act in 2024 to develop a methodology calculating the emissions savings of low carbon hydrogen comes far too late.

Renewable hydrogen is the EU's strategic priority

Renewable and low carbon hydrogen should not be treated as equal when it comes to tariff discounts. When injecting renewable hydrogen into the grid, renewable hydrogen should receive a higher discount than low carbon hydrogen.

A role for the European Investment Bank (EIB)

Emissions trading scheme (ETS) and carbon tax

Making renewable hydrogen happen everywhere

Game-changing industrial decarbonization

Achieving climate neutrality will require a massive effort to decarbonize the heavy industries that facilitate the functioning of our economies, including inter alia steel, aluminium, refining, fertilisers and chemicals.
We have the experience and know how to develop large scale products based on industry 4.0 principles that enable deep decarbonization and bankability of projects.
We deliver our customers products that are safe, robust and reliable. Our products are scalable, cost-effective and do not rely on rare earths and exotic materials.

Enabling a fully renewable and efficient energy system

There is an ever-increasing need to capture curtailed power and balance the electric output to the grid and offer seasonal storage.
For large scale storage of renewable energy, hydrogen is by far the most suitable alternative – increasing the lifespan of electricity from zero to infinity.
In Germany in 2020, an estimated €1.35 billion worth of offshore wind energy was curtailed due to insufficient transmission grid capacity.
In Great Britain, during the last 12 months (October 2020-October 2021), 2,5TWh of renewable electricity was curtailed at a cost of 172 million GBP. With replacement generation, the cost goes up.

Decarbonizing heavy duty transport

When used in vehicles, renewable hydrogen is a zero-emission fuel that offers the same range and convenience and fast charging offered by fossil fuels today.
Hydrogen and hydrogen derivatives also known as synthetic fuels will have a crucial role to play in cutting emissions in the aviation and maritime sectors, propelling decarbonization both in the air and at sea.
Modular and multipurpose, Nel’s hydrogen refuelling station, H2Station, is compact.
The unique modular design makes it as easy to build as with Lego® bricks.

Herøya:
An industrial gamechanger

The world’s first fully automated electrolyser manufacturing facility, designed according to lean manufacturing and industry 4.0 principles.

Industrial scale production of the most efficient electrolysers in the market, at a game-changing cost.

Large scale production line, name plate capacity of more than 500 MW with room to expand to 2 GW annually.

Annual CO2 reduction potential for our customers in line 1 (500MW) of 1.000,000 tonnes – with 2 GW, 4-5 million tonnes.

Leading the race towards fossil parity.

No use of rare elements, exotic materials or platinum group metals.

For information about our EU policy positions, as well as more information about our projects, and about Nel in general, please download our EU brochure.