Hydrogen Network Regulation Can Enable Rapid and Efficient Build-Out of Integrated EU Network

In December 2021, the European Commission released its Regulatory Package to catalyse the implementation of the EU’s ambitious Hydrogen Strategy. The package builds on insights from a study by Guidehouse in partnership with Frontier Economics.

The European Union (EU) set a goal of creating at least 40 GW of electrolyser capacity within the EU and a goal of using up to 10 million tonnes/year of renewable hydrogen by approximately 2030 in line with its goal of climate neutrality by 2050. Much of this hydrogen is expected to be delivered through a pipeline network akin to the existing natural gas grid.

The study by Guidehouse and Frontier Economics supported the European Commission throughout 2021 while it was considering which regulation, if any, should cover the build-out and operation of this hydrogen network, especially across EU Member States.

Guidehouse and Frontier Economics partnered to :

• Develop an overarching framework for the impact assessment of EU hydrogen market regulations
• Support the qualitative assessment of the key regulatory measures (third party access, vertical/horizontal unbundling and tariff regulation) against principal impact criteria within this framework (hydrogen market structure, cross-border integration, administrative costs, investments incentives for new hydrogen infrastructure, repurposing of natural gas pipelines), as well as their effect as part of example policy packages
• Create several methods for quantifying or semi-quantitatively assessing indicators for the future EU energy system under various scenarios and assumptions that can be expected to differ across EU hydrogen policy packages

The findings from the study were used as a basis for the impact assessment of the Hydrogen and Decarbonised Gas Market Package unveiled by the European Commission on 15 December 2021.

Read the full report here.