EU Regulations on Renewable Gas, Natural Gas, and Hydrogen Market Evolution
Key Ideas
- The EU's new regulations on renewable gas, natural gas, and hydrogen aim to enhance transparency, increase gas quality, and promote a market shift towards low-carbon alternatives.
- Key provisions include tariff discounts for renewable and low-carbon gases, ensuring firm capacity at production facilities, and facilitating third-party access to natural gas infrastructure.
- The legislation also emphasizes cross-border cooperation among Transmission System Operators (TSOs) to avoid restrictions on gas flows and prioritizes the development of dedicated hydrogen infrastructure over blending hydrogen with natural gas.
- Member States are required to transpose the Directive into domestic law by 5 August 2026, with a focus on cutting greenhouse gas emissions and ensuring security of supply.
On 4 August 2024, Regulation (EU) 2024/1789 and Directive (EU) 2024/1788 on the internal markets for renewable gas, natural gas, and hydrogen came into effect in the European Union. The Regulation, directly applicable from 5 February 2025, introduces new measures to cut greenhouse gas emissions and enhance security of supply, promoting a shift towards climate neutrality. Fundamental regulatory principles such as unbundling utilities and ensuring non-discriminatory third-party access are maintained, alongside new sections focusing on renewable and low-carbon gases. The legislation defines terminology related to renewable gas and low-carbon gas, emphasizing quality parameters and market transparency. It also sets out requirements for tariff discounts, firm capacity at production facilities, and third-party access to natural gas infrastructure. Member States must enable access to renewable and low-carbon gases, with restrictions only under specific conditions. Cross-border cooperation among TSOs is highlighted to prevent gas flow restrictions. The legislation prioritizes the development of dedicated hydrogen infrastructure over blending hydrogen with natural gas. These regulations underline the EU's commitment to promoting cleaner energy sources and driving the transition towards a more sustainable energy market.