Pact for a Clean Industry: A clear course conducive to the deployment of hydrogen in Europe
In the face of the threats to European industry, the Clean Industry Pact sets out an ambitious panorama of solutions that responds to the challenges of the EU’s loss of competitiveness illustrated in the Draghi report. Its implementation over the next two years will be crucial.
Its systemic approach makes it possible to address a large number of the obstacles that the hydrogen sector is currently facing in order to deploy on a large scale.
- Firstly, the completion of the regulatory framework with the publication in March of the delegated act defining low-carbon hydrogen: pragmatic and fair rules with RFNBOs must be adopted.
- The Pact announces a series of measures and mechanisms that should significantly contribute to securing a competitive electricity supply for hydrogen producers. The pilot program on corporate PPAs, designed primarily for energy-intensive manufacturers, is particularly welcome. It is nevertheless regrettable that the post-2030 sustainability of the compensation of indirect carbon costs is not mentioned.
- Third auction of the “Hydrogen Bank”, investment plan for sustainable transport and particularly aviation and maritime fuels, Industrial Decarbonization Bank, and simplified framework for State aid: a set of measures that illustrate the financing effort. It remains to concretize them and in particular to ensure fully equitable access to financing for RFNBOs and low-carbon hydrogen.
- Beyond subsidies, project risk management will be one of the keys to mobilizing private financing during the industrial deployment phase of hydrogen. The Pact charts an ambitious path: a CleanTech Guarantee Facility could cover part of the performance risk of European electrolysers, while the Hydrogen Mechanism could translate into a public market intermediation system to conclude the contracts necessary for the financial closure of projects.
- Finally, a set of measures to ensure the competitiveness of European industry is outlined. The Carbon Border Adjustment Mechanism will be revised: completing its scope of application with certain areas of chemistry and downstream products will be crucial. At the same time, the creation of low-carbon pilot markets is being discussed, particularly for steel and fertilizers: its translation by the end of the year into effective mechanisms will be decisive.
Philippe Boucly, President of France Hydrogen said:
The Clean Industry Pact marks a major turning point in safeguarding our industries and our sovereignty, and highlights the role of hydrogen in meeting this challenge.
“The ambitious milestones set by the Commission must now be met, and in particular renewable and low-carbon hydrogen must be treated fairly in all the measures announced. In this broader European framework closely linking decarbonization and reindustrialization, it is essential that France maintains its course and its objective of being one of the leaders in clean hydrogen.”
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Pact for a Clean Industry: A clear course conducive to the deployment of hydrogen in Europe, source
