The French hydrogen association France Hydrogène (AFHYPAC) is asking the European Commission to keep under control the tax regulation for carbon emissions on hydrogen production, saying that “a sustainable finance taxonomy” should not impose significant and crippling restrictions to the hydrogen manufacturing process.

In a letter obtained by Kallanish addressed to vice-president for the European Green Deal Frans Timmermans, amongst others, the association explains that hydrogen is currently produced 95% via fossil fuels. According to the draft of the taxonomy regulation act on climate change, this way of producing is not compliant with the EU emission reduction targets. The letter dubs the greenhouse (GHG) emissions savings threshold “overly restrictive” for hydrogen manufacturing as the criteria stated for the taxonomy also rules out the use of solar energy in the production of hydrogen.

“The signatories are concerned that the currently proposed criterion of 2.256 kilograms carbon dioxide equivalent per kilogram of hydrogen largely pre-empts the regulatory debate to take place with respect to the EU hydrogen framework and undermines the EU leadership ambition whilst unnecessarily limiting business options compatible with Paris-aligned business trajectories. This criterion would also be at odds with the communication on a hydrogen strategy for a climate neutral Europe issued by your services in July 2020 as the category of electricity-based hydrogen would become obsolete if this threshold is maintained," the letter concludes.

Together with AFHYPAC, ArcelorMittal, McPhy, ABB, Engie are amongst the signatories of the letter.  

The European Commission announced last month it will provide nearly €10 billion ($12 billion) of funding to set up 10 new European partnerships between the European Union, member states and/or the industry. One of the 10 partnerships is called Clean Hydrogen. It will accelerate the development and deployment of a European value chain for clean hydrogen technologies (see Kallanish 24 February).