Contrary to reports from international news organisations such as Reuters and Bloomberg (see panel below), the European Commission’s new Delegated Act — which sets out definitions for what constitutes renewable hydrogen and its derivatives — does not actually allow green H2 to be produced using nuclear power.
The confusion seems to have arisen from a new clause in the document — one that had not been seen in previous draft versions — which will allow France to avoid the need for “additionality” in green hydrogen production in future years due to its low-carbon nuclear-dominated electricity grid.
The “additionality” principle — which aims to ensure that green hydrogen production via electrolysers does not utilise renewable energy that would otherwise have been used to provide zero-carbon electricity to the grid — is a vital part of the Delegated Act. Without it, fossil-fuel-fired power would be needed to replace the green electricity used for H2 production, and thus push up greenhouse gas emissions overall.
All green hydrogen projects in the EU therefore need to be powered by new renewable projects, which the Delegated Act has now defined as plants that “came into operation not earlier than 36 months before the installation producing the [H2 or its derivatives]”.
But the document — specifically Article 4 — also sets out two circumstances in which additionality is not required.
One is when the hydrogen is being produced in a “bidding zone” where the grid received more than 90% of its electricity from renewables in the previous calendar year. In this case, producers “may count electricity taken from the grid as fully renewable”, when the production of hydrogen does not exceed a maximum number of hours per year.
A bidding zone is defined as the largest geographical area (often national boundaries) within which market participants are able to exchange energy without capacity allocation (ie, energy imported from outside the zone).
The second circumstance is when the emission intensity of electricity in a bidding zone is lower than 18 grams of CO2-equivalent (CO2e) per megajoule, which is equivalent to 64.8gCO2e/kWh.
This is where France’s nuclear-reliant electricity grid comes into play.
According to the website Nowtricity, which monitors greenhouse gas emissions from electricity production in real time, the French grid saw an average 73gCO2e/kWh in 2022 — a year when a large proportion of its atomic fleet was down for maintenance or repairs. Previous years had seen average greenhouse gas emission rates of 55-56gCO2e/kWh, so France could qualify for not requiring additionality for its green hydrogen projects as soon as next year.
But this does not mean that France could produce renewable hydrogen from nuclear power, according to the new EU rules.
Hydrogen producers will still need to prove that the energy they use has come from renewable sources.
As the Delegated Act explains, producers must “have concluded directly, or via intermediaries, one or more renewables power purchase agreements with economic operators producing renewable electricity in one or more installations generating renewable electricity for an amount that is at least equivalent to the amount of electricity that is claimed as fully renewable and the electricity claimed is effectively produced in this or these installations”.
In other words, they can use grid electricity to produce hydrogen, but only when providing proof that they have bought renewable energy from existing or new projects through an electronic certification scheme, such as guarantees of origin.
And producers also have to provide the same proof of temporal and geographical correlation of renewable-energy usage as any other green hydrogen producer (see previous story for details).
News organisations have misinterpreted Article 4 as meaning that nuclear electricity can be used to produce renewable hydrogen, which perhaps shows a lack of understanding about how utility-scale renewable energy is bought and sold.
When large wind and solar farms produce renewable energy, in most cases, that power is sent to the local grid, at which point the green electrons are indistinguishable from those produced from coal or fossil gas. But anyone on the grid can buy the renewable energy through certification schemes.
The producer effectively gets renewable energy certificates to prove they have produced a certain quantity of renewable energy, and the buyer will buy those certificates to prove that they bought a certain quantity of renewable energy, even when they are not directly connected to wind turbines, solar panels or any other type of green electricity production.
This is how members of the public can buy renewable energy from their local electricity supplier.
The same principle applies in Article 4 of the Delegated Act. Renewable hydrogen producers have to prove they have bought renewable energy certificates, rather than wind or solar power directly. But the electrons they are physically supplied with may have originated from nuclear power plants — or indeed, coal- or gas-fired generation.
But this is the same situation as all purchases of renewable energy from the grid — it is nothing special or specific within the Delegated Act.
So, no, the EU has not allowed nuclear power to be used to generate renewable hydrogen. And the word “nuclear” is not even mentioned in the document.
Low-carbon hydrogen
France has, however, won another small victory for its nuclear industry from the European Commission, although this came from a document accompanying the Delegated Act, rather than the act itself.
Two weeks ago, France and eight other EU member states wrote to the European Commission to call for “low-carbon” hydrogen — made from nuclear energy or possibly fossil gas with carbon capture and storage (ie, blue H2) to be classed as renewable — with Germany and others fiercely opposed to the idea.
France and friends lost the argument, but seem to have won a compromise of sorts, with the European Commission promising separate rulings on “low-carbon” hydrogen by the end of next year.
“Under the Commission's proposal, a methodology for assessing greenhouse gas emissions savings from low carbon [hydrogen-based] fuels will be set out in delegated legislation by 31 December 2024,” says the European Commission note.
However, this does not mean that “low-carbon” hydrogen would qualify for EU subsidies in the same way that renewable H2 will.
For more information on the planned EU subsidies, click here.
