48 Cyprus Energy Regulatory Authority European Commission Public Consultation on hydrogen and decarbonizing the EU gas market In the context of the European Green Deal's efforts for decarbonizing the EU gas market, the European Commission launched an open public consultation from 26 March to 18 June 2021 on the revision of Directive 2009/73/EC concerning common rules for the internal market in natural gas and Regulation 715/2009/EC on conditions for access to the natural gas transmission networks. The objective of this consultation is to seek stakeholder views on how the Gas Directive and Gas Regulation should be revised as to facilitate the uptake of renewable and low-carbon gases and consumer empowerment, while ensuring an integrated, liquid and interoperable EU internal gas market. The issues that were raised during the consultation primarily relates primarily to cost-efficient decarbonization of the existing gas sector and the enabling a market for renewable and low carbon hydrogen allowing it to become a key component of the energy sector. Focus was also placed on facilitating the injection, transmission, distribution and trading of renewable and low carbon gases in the existing gas grid in the context of the wider energy system integration. Proposal regarding the common rules for the internal markets in renewable and natural gases and in hydrogen5 Hydrogen is expected to be used mainly in the areas where electrification is not an option, including today's energy-intensive industry (e.g. refineries, fertilisers, steel making) and certain heavy-duty transport sectors (maritime transport, aviation, long distance heavy vehicles). Developing a dedicated hydrogen infrastructure is necessary to release the full potential of this energy carrier in specific enduse applications. The objective of promoting renewable and low-carbon gases is to decarbonize these sectors, increase the flexibility of the electricity system thanks to power-to-X technologies, strengthen security of supply by reducing dependence on natural gas imports and allow to store (and produce) electricity. On 15 December 2021, the European Commission presented a proposal which seeks to facilitate the penetration of renewable and low-carbon gases into the energy system, enabling a shift from natural gas and to allow for these new gases to play their needed role towards the goal of EU climate neutrality in 2050. Within this context, it addresses the following areas: • Low level of customer engagement and protection in the green gas retail market. • Hydrogen infrastructure and hydrogen markets: The current regulatory framework for gaseous energy carriers does not address the deployment of hydrogen as an independent energy carrier via dedicated hydrogen networks. There are no rules at EU level on tariff-based investments in networks, or on the ownership and operation of dedicated hydrogen networks. In addition, no harmonized rules on (pure) hydrogen quality exist. Consequently, barriers exist for the development of a cost-effective, cross-border hydrogen infrastructure and competitive hydrogen market. • Renewable and low-carbon gases in the existing gas infrastructure and markets, and energy security: To untap their potential, access to the gas wholesale market, i.e. the virtual trading points, represents a key prerequisite. Abolishing costs for cross-border trade of those gases and facilitating connection of production facilities will also improve the business case. • Network planning: Current network planning schemes and practices are deficient as there are discrepancies between the EU-wide ten-year network development plan ('TYNDP') and national network development plans ('NDP'). 5 https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM%3A2021%3A0803%3AFIN
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