Green Hydrogen - The EU is in its element, but is Ireland catching up?

With the COP26 summit as a backdrop, and after the publication of the IPCC's most recent report in February of this year, governments are under pressure to reduce CO2 emissions and meet their renewable energy targets. As governments seek to turn targets into concrete policies, many have highlighted hydrogen as part of their strategy to net zero, including the EU and the UK. Although Ireland has not yet adopted a hydrogen strategy, as an island with extensive offshore wind potential, it is well positioned to take advantage of the opportunities offered by green hydrogen.

The intensifying focus on hydrogen should also be seen in the context of the current energy crisis, where soring energy bills call for long-term energy strategies to be carefully considered and dependency on Russian gas to be reduced.

What is Green hydrogen?

Green hydrogen is a carbon free fuel produced by splitting water into its constituent elements (hydrogen and oxygen) using an electrolyser powered by renewable energy sources. This differs from other forms of hydrogen product, most notably 'blue' and 'grey' hydrogen, which are produced from natural gas or methane and emit carbon dioxide as a by-product.

One of the main benefits of green hydrogen, besides its clean carbon footprint, is the fact that the hydrogen production can be powered by the excess electricity produced during peak periods, which cannot otherwise be injected into a saturated power grid. Furthermore, hydrogen can be stored, which means it can supplement existing renewable energy sources during periods of reduced renewable energy production. Green hydrogen fuel also has potential in sectors where decarbonisation has been difficult, such as transport, agriculture and manufacturing.

The EU perspective

The EU's Green Deal outlines the EU's objective to be the first climate neutral continent by 2050. As part of the Green Deal, the EU outlined the EU Hydrogen Strategy which identifies three phases for the uptake of hydrogen. Its ambitious aims include the installation of 40GW of electrolysers and the production of up to 10 million tonnes of green hydrogen by 2030.

In order to assist with the implementation of the strategy, the European Clean Hydrogen Alliance was set up by the Commission in July 2020 to support the creation of a European hydrogen industry. The Alliance will establish an investment agenda and support the scaling up of the hydrogen value chain across Europe.

On 15 December 2021, the European Commission published its new hydrogen and gas market decarbonisation package entitled "Proposal for a Directive of the European Parliament and of the Council on common rules for the internal markets in renewable and natural gases and in hydrogen" (the Proposed Directive). The main aims of the Proposed Directive are to establish a competitive market for hydrogen, create the right environment for investment, and enable the development of dedicated infrastructure. This reflects an updated regulatory framework that any Green Hydrogen strategy Ireland adopts should align with.

The Irish perspective

Ireland is one of a handful of EU member states without a hydrogen strategy. However, Ireland has acknowledged the important part that green hydrogen could play in meeting Ireland’s climate targets. The government published the Climate Action Plan 2021 (CAP21), which sets out targets of identifying a route to deliver 1-3 TWh of zero emissions gas (including green hydrogen) by 2030. It also provides for the introduction of incentives for electrolyser production and grid connection of green hydrogen.

The Department of the Environment, Climate and Communications (DECC) has since indicated that the government intends to publish the Climate Action Plan 2022 (CAP22) in the first quarter of 2022. Junior Minister Ossian Smyth said he expects a strategy focusing on development of green hydrogen to be included as part of the CAP22. 

Furthermore, a Private Members Bill has been launched by Sinn Féin titled 'Green Hydrogen Strategy Bill 2022', which is currently before the Dáil Éireann, second stage. The bill, if implemented, would oblige the Minister for the Environment, Climate and Communications to draft and publish a hydrogen strategy within six months of its passing.

It is clear that the development of a green hydrogen market is underway and we can expect to see the government issuing a national Green Hydrogen Strategy this year. The DECC recently launched a public consultation in light of the provisions in the Proposed EU Directive, in order to gather the views of stakeholders and all interested parties. The closing date for submissions to the public consultation is 15 April 2022.

For further information in relation to this topic, please contact Alan Roberts, Partner, Alison Fanagan, Consultant, Jason Milne, Partner, or any other member of ALG's Environmental & Planning team.

Date published: 1 April 2022