In March 2024, the EU reached an agreement on the Gas Package, which was officially adopted in June. According to the agreement, hydrogen is considered “low-carbon” if it produces 70% fewer greenhouse gas emissions than fossil fuels and hydrogen made from unabated fossil gas. This agreement follows from rules on renewable hydrogen agreed by the Commission in June 2023, as part of the Renewable Energy Directive revision.
In September 2024, the Commission presented supplementary legislation in the form of a Delegated Act to expand on the methodology for meeting the 70% GHG threshold, addressing key issues such as:
The Commission also launched a public consultation alongside the draft Delegated Act, seeking to gather stakeholder views on the methodology. The consultation concluded in late October 2024.
Despite opposition from heavy industry, the EU Commission proposal presented in July 2025 introduced a methodology that assesses emissions across the entire life cycle of low-carbon hydrogen, taking into account indirect emissions and carbon capture rates. However, in contrast to the Gas Package agreement, it did not include hydrogen leakage, citing a lack of scientific data available. A pledge to ‘safeguard’ existing low-carbon hydrogen projects from future revisions of the Act was also included. The Delegated Act will now be submitted to the European Parliament and the Council, which have a period of two months (extendable with another two months) to accept it or object to it, and will enter into force only after it passes this period of review.
Energy Transition & Zero Carbon Technologies
Commission due to publish finalized proposal in Q1 2025
Energy Transition & Zero Carbon Technologies
Commission due to publish finalized proposal in Q1 2025
Following the European Commission’s 8 July announcement that it had finalized the Delegated Act defining low-carbon hydrogen, both Hydrogen Europe and the German Chemical Industry Association (VCI) issued press releases that appeared unsupportive of the final rules. Hydrogen Europe advocated for the continued use of power purchase agreements (PPAs) to source low-carbon electricity, while VCI argued that the rules are "too strict."
In a 23 June joint statement, multiple industry associations including Eurogas, FuelsEurope, and the International Federation of Industrial Energy Consumers (IFIEC) opposed the EU Hydrogen and Gas Decarbonization Package Delegated Act on the definition of low-carbon hydrogen. The entities advocated to weaken the Delegated Act by not supporting stringent measures on methane leakage and promoting the grandfathering of existing production facilities. The signatories also advocated for a technology-neutral policy framework for hydrogen, in contradiction to the EU Commission's ambition to primarily promote renewable hydrogen, as stated in its July 2020 Hydrogen Strategy.
In a 22 July position paper, SolarPower Europe advocated for an ambitious definition for low-carbon hydrogen to be included in the EU Hydrogen and Gas Decarbonization Package, which takes into account full lifecycle emissions, excludes carbon offsets and introduces leakage monitoring.
In a November 28th open letter from EU industry, several entities including Eurelectric, European Chemical Industry Council (Cefic), Eurofer, EDF and ArcelorMittal, advocated for the inclusion of ‘low carbon’ hydrogen in the EU Renewable Energy Directive III and Hydrogen and Gas Market Decarbonization Package, which can include non-renewable hydrogen sources.
In a 30th June position paper, GasNaturally advocated for the EU Energy Performance of Buildings Directive revision to reverse national bans on fossil gas technologies, including gas and hybrid boilers. Furthermore, GasNaturally called for the EU Hydrogen and Gas Decarbonization Package to provide clearer definitions for renewable and low-carbon gases in a 1st July position paper. However, the group also advocated for all forms of hydrogen to be supported in the scope of the policy.
Hydrogen Europe advocated for clear definitions for renewable and low-carbon hydrogen under the EU's Hydrogen and Gas Decarbonization Package in a June 2022 position paper. The group also appeared to support the EU Commission's proposal to include hydrogen and fossil gas blending as a transitional measure.
In a 12th May statement, the European Round Table for Industry (ERT) advocated a mixed position on the transition of the energy mix. ERT advocated for the EU to reduce its demand for gas, broadly supporting the EU Gas and Hydrogen Decarbonization Package, and carbon contracts for difference, however it also supported increasing fossil gas production and infrastructure, and "renewable and low carbon" hydrogen.
In a 12th April consultation response on the EU’s Hydrogen and Gas Decarbonisation Package, released this week, Equinor advocated for the role of fossil gas in the energy transition, stating that all types of hydrogen will be required to meet the EU’s climate ambitions, and that this will require ‘new sources’ of fossil gas.
In a 12th April consultation response on the EU’s Hydrogen and Gas Decarbonisation Package, published this week, BP appeared to support the continued use of fossil gas in the energy mix, citing the need to complement renewable energy, improve air quality and reduce emissions. The company also advocated for ‘technologically neutral’ hydrogen policies, stating preference for a certification scheme that is based on carbon intensity, rather than method of production
In an opinion piece for Euractiv, published on the 29th April, Eurofer Director General Axel Eggert cited the war as justification for slowing down the EU Commission’s proposed phase out of free allowances in the EU Emissions Trading System (EU ETS) alongside the implementation of a Carbon Border Adjustment Mechanism. Axel Eggert also did not support proposed reforms to the EU ETS to rebase the emissions cap and strengthen the Market Stability Reserve, stressing the impacts of a unilateral and high carbon price and international competitiveness. However, Eggert also advocated for the RePowerEU and Gas and Hydrogen Decarbonisation package to increase renewable electricity and green hydrogen since the war in Ukraine “undermined the possible role of gas as a transition fuel.”
In a position paper on the Hydrogen and Gas Markets Decarbonization Package, published on 12th April 2022, Cefic did not support the proposal to blend hydrogen with fossil gas, preferring pure fossil gas networks. The association stated support for the roll out of low-carbon and renewable solutions, including hydrogen, albeit in a technology neutral manner. Cefic also seemed supportive of the phase out of unabated fossil gas in the energy mix, but advocated for long-term gas contracts to create low-carbon hydrogen and for carbon capture use and storage (CCUS).
In an April 2022 position paper on the EU Hydrogen and Gas Decarbonization Package, Fortum supported the package with major exceptions. The utility promoted a continued role of unabated fossil gas, supported fossil gas and hydrogen blending, and supported exemptions for LNG in the package.
In a join position paper, Federation of German Industries (BDI), Confindustria and The Mouvement des entreprises de France (MEDEF) promoted fossil gas as a 'a key commodity of the decarbonization process' for decarbonization without clear conditions related to CCS or mitigating methane emissions. However, the associations also supported development of regulatory framework for climate-neutral gases within the 'Gas Package' and Hydrogen Strategy.
EnBW released a COP26 page on its corporate website discussing several elements of EU climate policy. The company stated support for the reforms made to the EU ETS, in particular suggesting waiting till after 2030 to integrate emissions trading systems for the buildings and road transport sectors.
However, the company appeared to advocate against increased ambition in the EU’s Energy Efficiency Directive, highlighting issues with the inclusion of new CHP high-efficiency criteria. Similarly, it supported a weakening of the EU’s Renewable Energy Directive, by suggesting the criteria for renewable hydrogen and bioenergy were too strong.
Finally, EnBW advocated for a greater role for fossil gas in EU policy. The company called for the weakening of the EU's taxonomy, particularly by including fossil gas for heating/cooling generation as a transitional activity. EnBW also suggested that the EU's Hydrogen and Gas Decarbonization Package applies too much pressure to transition away from fossil gas.
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