This chapter focuses on the new gas directive and regulation (the Gas Package) from the perspective of the hydrogen ‘revolution’, and the importance allocated to its future role in the ongoing energy transition and in the achievement of the ambitious net zero target by 2050. Particular attention is given to key regulatory concepts and pillars in the new Gas Package, aimed at creating the conditions for a more cost-effective transition and creating an internal market in hydrogen and low carbon gases: these are unbundling, tariff regulation and third-party access. The chapter first describes these concepts as developed by the new measures and questions whether these concepts, which have been effectively transposed from natural gas regulation to hydrogen regulation, are suitable to achieve a cost-effective transition to a decarbonised gas market. In particular, the chapter will examine whether the proposed terminology, although fundamental, is sufficiently clearly and comprehensively defined in the new measures. Second, the chapter questions whether the new Gas Package establishes the necessary stable regulatory framework for incentivising hydrogen investment, by highlighting where the Gas Package could have been more comprehensive but also flexible in its treatment of concepts such as unbundling, on the tariff regime and third-party access provisions. It also queries whether the challenges of regulatory balancing can be adequately dealt with by way of the ‘regulatory holiday regime’ as proposed in the Gas Package.

This chapter delves into evolving policy and regulatory dimensions shaping the emergence of hydrogen in the Latin American energy landscape. With a focus on three regional leaders – Chile, Colombia and Brazil – it explores the distinct strategic paths these countries are charting as they seek to position themselves in the burgeoning hydrogen economy. Chile, Colombia and Brazil, aiming to capitalize on their abundant (renewable) resources, have moved swiftly to outline ambitious hydrogen strategies and legislation. Despite this progress, as the chapter reveals, important regulatory challenges still limit their ability to fully tap the hydrogen well. Even as these obstacles persist, interest in hydrogen projects continues to soar, as exemplified by the numerous developed or in-development pilot projects pragmatically leveraging the existing frameworks. Ultimately, while clean hydrogen promises to usher in an era of sustainable development for Latin America, regulatory efforts matching policy ambitions will continue to be needed to successfully transition from promise to actual production.

In June 2020, the German Federal Government adopted its National Hydrogen Strategy (NWS), which was updated in July 2023, viewing green hydrogen as a key to the energy transition. To achieve net greenhouse gas neutrality by 2045, as required by law, the NWS envisages a rapid market ramp-up for hydrogen. This policy is supported by the recent amendment of the Energy Industry Act (EnWG), which introduces provisions for a prompt creation of a so-called hydrogen core network. However, for now, the required infrastructure does not exist. Against that background, this chapter will examine the existing permission regime in Germany for pure hydrogen infrastructure, specifically its transportation via pipelines and its large-scale storage in salt caverns as the best short-term storage option. The analytical focus will be trained on existing legal barriers that stand in the way of accelerating the construction and repurposing of infrastructure to disseminate hydrogen. To secure the planning and approval framework for the rapid expansion of hydrogen infrastructures in Germany, necessary adjustments to the current legal framework are proposed.

Both the European Union and the Netherlands have recently announced their ambitions on the production and consumption of (renewable) hydrogen. A significant increase in hydrogen production and consumption in the Netherlands will require the development of large-scale hydrogen infrastructure such as hydrogen transport and storage. This chapter examines the development of such infrastructure in the Netherlands. First, it briefly discusses plans of group companies of N.V. Nederlandse Gasunie’s (Gasunie), the operator of the Dutch nationwide natural gas network, and of other natural gas infrastructure in the Netherlands and northern Germany, for the development and operation of hydrogen transport, storage and import infrastructure. Second, it explores the current Dutch legal framework regulating these hydrogen activities. Third, it offers a first appraisal of the European proposals on third-party access to hydrogen infrastructure as well as of their proposals for exempting new hydrogen infrastructure. Together, this provides the reader with a brief overview of the current Dutch legal framework for hydrogen activities, the potential future EU legal framework for access to hydrogen infrastructure in the Netherlands and the resulting challenges for developing such infrastructure.

The Association of Southeast Asian Nations (ASEAN) Member States are increasingly focusing on alternatives to electrolysis for the production of ‘green’ hydrogen, such as steam reforming of biofuels and biomass gasification. This chapter analyses the possibility of effectively achieving that under the existing general regulatory framework on energy production, namely the laws on the establishment and operation of factories, as well as environmental protection laws in ASEAN countries that regulate hydrogen production, with special attention on biomass gasification and steam reforming of biofuels. It finds that, despite falling outside of energy regulatory frameworks, hydrogen production from biomass/biofuels is regulated under general legal frameworks on manufacturing activities, occupational health and safety, as well as environmental protection laws. This is demonstrated in more detail by referring to a case study on Thailand. The chapter argues that, in the absence of robust criteria on hydrogen classification, it is possible for an electricity producer that generates electricity from grey hydrogen to gain financial benefits that were formerly thought to be reserved for the promotion of ‘green’ electricity production from blue or green hydrogen, in the case of re-electrification of hydrogen after storage.

This chapter investigates the production of renewable hydrogen by electrolysis, namely the permits that are required to put an electrolyser on the ground. This will be investigated with the help of a case study on Finland. In Finland, permitting practices for renewable hydrogen electrolysers are only just starting to develop. Permitting procedures are still fragmented and there is no so-called one-stop-shop for hydrogen electrolyser permits. Several different permits by different authorities, both municipal and state authorities, are required and the permit procedures are usually independent of each other. These complicated permit procedures can be a challenge for setting up new hydrogen electrolysers as the pitfalls and challenges of the permit process, namely complicated bureaucracy as well as long permit handling times, can deter hydrogen investors. The chapter describes possible solutions to this problem and also sketches the actions taken by the government to tackle it. The conclusion is that a number of improvements to the system are currently being implemented, but their actual effects are yet to be seen and challenges still exist.

This chapter examines the regulation of the hydrogen refuelling infrastructure in the European Union (EU). Since the EU is committed to reducing its carbon footprint and transitioning to sustainable energy sources, it sees hydrogen as an alternative to fossil fuels in the transport sector. This view reflects the tenor of the EU Green Deal, the Hydrogen Strategy, and the Sustainable and Smart Mobility Strategy. The success of these strategies depends on the successful resolution of several issues that would otherwise disrupt the just transition in the transport sector. The deployment of hydrogen refuelling stations requires a careful analysis of the various legal barriers that affect the value chain of the hydrogen industry.

This chapter discusses the permitting regime for electrolysers in Aotearoa New Zealand. Because green hydrogen is typically converted from water via electrolysis, hydrogen projects are dependent upon electrolysers – and, therefore, upon obtaining the necessary consents to build and operate these. However, New Zealand’s resource consent rules do not specifically provide for permitting electrolysers. Instead, resource management legislation provides for consent to be obtained for use of those resources that will be needed for (and impacted by) the electrolyser operation, with health and safety rules and industry standards prescribing the specifications for electrolysers and the way these can be used. The chapter asks what permits will be needed and what processes must be followed in order for an electrolytic hydrogen project to receive resource consent. While examining the consenting process, the chapter also considers whether New Zealand’s existing regulations can support its hydrogen aspirations.

As underlined by the EU`s Hydrogen Strategy for a Climate Neutral Europe and the REPowerEU programme, the development of a hydrogen economy is considered of strategic importance for the achievement of the EU Climate goals by both the EU and several of its Member States. As for any socio-technical transition, the development of the hydrogen economy requires careful policy and regulatory drafting, as well as the concrete implementation of projects affecting the living environment of people. Public participation is mandated under international, European and national law to ensure that the hydrogen economy best fits within the environmental and societal needs of the interested regions. This chapter uses the first fully fledged hydrogen valley in Europe as a case study to map the participatory requirements that should be applied in the development of a hydrogen economy and to show how these requirements have not been (fully) respected so far. In doing so, the chapter will provide data for comparative purposes and for the further development of the conceptual and applied frameworks for the hydrogen economy.

The Oceania region, particularly Australia and New Zealand, has recently welcomed a suite of strategies and policies to support the development of hydrogen. Australia’s current National Hydrogen Strategy strives to position the country as a top three global exporter of hydrogen by 2030. New Zealand’s Interim Hydrogen Roadmap aims to utilise hydrogen to decrease domestic emissions, foster economic development, and enhance energy security while supporting its 100 per cent renewable electricity by 2030 target. To achieve these hydrogen strategies and targets, it is essential to establish enabling regulatory frameworks. Regulation is required to strategically plan, identify, assess, and permit the development of onshore hydrogen production facilities and associated infrastructure, ensuring coexistence with multiple and diverse land uses. The chapter investigates the strategies, policies, and developing planning and licensing regulatory regimes for the development of renewable hydrogen in Australia and New Zealand. Specifically, it examines recent regulatory developments in two Australian states, Western Australia, and South Australia. Regulatory developments in both states are designed to facilitate the assessment and award of hydrogen production licences on Crown-owned pastoral leasehold land. As interest increases in the assessment and structure of hydrogen production licensing on complex land uses, the experiences in Australia and New Zealand provide important legal case studies. These experiences highlight the diverse approaches to planning and permitting hydrogen on pastoral land uses and offer valuable insights to support the development of future hydrogen economies.

The European Union (EU) identified sizeable needs for both local production and imports of renewable hydrogen by 2030, as enshrined in the 2020 EU Strategy on Hydrogen. But how sustainable, exactly, can the production of such huge amounts of renewable hydrogen be? EU lawmakers also decided to require from both EU and non-EU hydrogen producer’s adherence to the sustainability criteria that apply to bioenergy since 2009. The need for sustainability criteria in the context of bioenergy arose from the massive deforestation caused by the production of biofuels, generating greenhouse gases, destroying local biodiversity and linked to human rights violations. This chapter scrutinizes if and to what extent it makes sense to use the analogy to bioenergy for establishing sustainability criteria for renewable hydrogen, as the EU did. It finds that placing the production of renewable hydrogen under this regime is in principle welcome, as it establishes clear thresholds in terms of environmental and social impacts. However, the chapter questions the details of the premise that a system which was tailored to bioenergy may successfully be applied to hydrogen, one-on-one. Additionally, it analyses whether the flaws of the existing sustainability criteria may also extend to renewable hydrogen.

The United States federal government is stimulating private investment in the hydrogen sector with the goal of producing and using 10 million metric tonnes (MMT) of clean hydrogen by 2030 and 50 MMT by 2050. Recent measures include $8 billion in grants for ‘hydrogen hubs’, $1.5 billion in research funding, and tax credits (uncapped) for qualifying investments or production. The response from industry, communities, and state and local governments to the grant program has been strong. However, implementation delays and regulatory uncertainty may delay infrastructure development and create risks for early investors. Thus, the outlook for success is still uncertain.

This chapter provides an economic framework for determining the appropriate regulation of hydrogen markets. In this framework the micro-economic benchmark of a well-functioning market is described, after which the concept of market failures is introduced. Amongst others, attention is paid to entry barriers for producers, such as economies of scale, information asymmetry between producers and consumers, inefficiency of price formation, and barriers for international trade. Next, it is discussed how these markets failures can be addressed through regulation. As regulatory measures may also be imperfect, the concept of regulatory failures is discussed. After the introduction of these microeconomic concepts related to the analysis of markets and regulation, they are applied to hydrogen markets. Discussions cover the entire hydrogen chain from production to consumption as well as wholesale and retail markets for hydrogen. In this manner, the chapter strives to ultimately answer the question to what extent and by what type of measures these hydrogen markets need to be regulated from an economic point of view.