Government puts Hydrogen Networks on Fast Track

Germany’s federal government today adopted a revision of the Energy Economy Act (Energiewirtschaftsgesetz, EnWG). The revision allows for cost-efficient and, especially, for fast development of hydrogen networks. The government thereby accelerates the hydrogen market update that is so important for the Energy Transition.

The key aspect of the adopted EnWG revision is a voluntary regulatory framework for hydrogen pipeline networks. Operators of hydrogen networks can choose to undergo regulation. Moreover, costs for hydrogen and natural gas pipelines have to be strictly divided. Cross-financing is prohibited.

INES’ Management Director Sebastian Bleschke comments:

„By today‘s resolution the government wants to put hydrogen networks on a fast track. While constructing natural gas pipelines through a long-term and complex process of developing a scenario framework and network development plans has to be planned, requested and authorized based on hard criteria; the new EnWG allows for an ad-hoc examination of demands by the German Federal Network Agency within four months. Transmission System Operators that do not choose a regulatory approach can even start building hydrogen pipelines without any examination thereby without any delays. That is not only important to connect supply and demand, but also for storage connections. So, this is great news for all those that seriously want to make a fast market uptake for hydrogen possible.

A strict division between natural gas and hydrogen networks in the resolution also ensures cost-efficiency. In the case of dropping natural gas sales in the future, costs of natural gas pipelines would be a heavy burden on the hydrogen market. This would not only be problematic regarding climate protection targets, but also releases Transmission System Operators from their duty to take a scenario of dropping natural gas network usage seriously.

The next step will be to develop a legal framework for hydrogen network development plans. We recommend shaping regulation in such a way that transmission system and storage system operators can pursue coherent infrastructures."

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