Industry groups: EU’s draft GHG rules threaten feasibility of low-carbon hydrogen

June 23, 2025, by Aida Čučuk

Industry groups, representing the entire energy value chain, from producers to industrial users, clean tech solution providers, and infrastructure operators, have called on the European Commission to acknowledge their concerns with the current draft ‘Delegated Act’ defining the greenhouse gas (GHG) methodology for low-carbon hydrogen and its derivatives, claiming that the legislation threatens the overall feasibility of this energy pathway.

Courtesy of the European Commission; Credit: Mauro Bottaro

According to the industry, the legislation would make it “overly difficult – if not practically impossible – to produce low carbon hydrogen and fuels,” be it in the European Union (EU) or at a global level, and imported to the EU.

In particular, the groups, including the International Association of Oil & Gas Producers, Ammonia Europe, and Methanol Institute, underlined what they called “the inability to fully showcase better GHG performance – despite being a core tenet of establishing a GHG methodology – combined with high default values.”

As disclosed, other concerns encompass: treatment of hydrogen from methane splitting, the implementation of the provisions linked with the methane regulation, the recognition of carbon capture and storage in third countries, and the inclusion of low-carbon fuels in the Union database.

“Taken together, these elements will hinder the deployment of this essential energy vector, the overall uptake of hydrogen and its infrastructure for the EU. This will further contribute to the widely flagged extra-costs (ACER) and barriers (Industry, Member States) caused by the EU regulatory framework on the deployment of all sources of hydrogen,” the groups said, adding: “This approach puts in jeopardy the Commission’s own vision for low carbon hydrogen, outlined as early as in the European Hydrogen Strategy (2020), further reinforced by the European Steel and Metals Action Plan, in the Clean Industrial Deal (2025) and underlined in the draft Delegated Regulation itself (2025).”

“The Commission must course correct if it wishes to create a favourable environment for investment, especially for first movers (e.g. grandfathering). Indeed, a simpler and more pragmatic approach is needed to kickstart the development of hydrogen in the EU. We urge the European Commission to amend the revised draft to ensure it enables the production and import of all types of low carbon hydrogen and fuels and recognises better environmental performances. This is critical for supporting the scale up of the hydrogen market in Europe, which already faces major challenges that undermine EU’s ability to meet its climate objectives,” the groups stated, calling on the EU to work with industry representatives on amendments.

It is worth noting that earlier in 2025, European associations called on the European Commission to revise the bloc’s hydrogen policy. Specifically, they asked for a hydrogen policy “reality check,” urging the Commission to address matters such as the adoption of a delegated regulation on low-carbon fuels.