Transitioning hydrogen from its current deployment – produced from hydrocarbons for local industrial use – into a global green commodity is a huge task. The few projects now reaching FID usually involve unique two-party agreements or guaranteed offtake within development consortiums. The lack of globally accepted standards, and the price risk of long-term contracts, remain major hurdles holding many projects back.
The EU’s Renewable Energy Directive III RED III will provide the main guiding regulations, replacing to a large extent the national schemes. “Europe wants to make sure the green hydrogen coming from an electrolyser is truly green,” says den Ouden. “But they might create rules which by market parties are seen as complicated.” For instance, RED III rules require correlation, that electricity flows into an electrolyser at same moment it comes from a wind farm.