Commission set to prolong fossil fuel subsidies

Substantial support for fossil hydrogen will worsen global warming warns Friends of the Earth

The European Commission is set to propose to continue EU support and subsidies for fossil fuel infrastructure when it unveils a new framework for future energy investment next week. Friends of the Earth Europe warns the move could undermine the clean energy transition and the newly-minted EU climate target of at least 55% net greenhouse gas emission cuts by 2030 agreed by EU leaders. This comes as NASA confirms that 19 of the 20 warmest years have occurred this century.

Tara Connolly, energy campaigner for Friends of the Earth Europe, said:

“If you find yourself in a climate crisis, the first rule is to stop pouring fuel on to the fire by subsidising fossil fuels. As the European Commission shapes Europe’s future energy infrastructure, it needs to unambiguously exclude support for all fossil fuels including fossil hydrogen infrastructure. Anything else makes a mockery of the EU’s new 2030 climate target.

“Hydrogen may seem clean and futuristic, but 99% of hydrogen in Europe today is made by fossil fuel companies splitting gas and releasing carbon, worsening global warming.

“Instead of asking what hydrogen can do for Europe’s gas industry, the EU should be asking what hydrogen can really do for Europe’s energy transition.”

Future energy infrastructure

On Tuesday (15 December), the European Commission is set to propose reforms to the EU rules for selecting energy infrastructure projects for financial and regulatory support, the so-called TEN-E regulation. Energy projects identified as being of ‘common interest’ benefit from fast-tracked planning and can receive millions in public subsidies. Controversy has dogged the current system, which has diverted over €1.5 billion in EU subsidies to outdated fossil gas projects without fully considering the impacts on the climate crisis.

However, a recent leak of the draft proposal reveals that, while the Commission plans to remove direct support for fossil gas projects, it will back hydrogen projects, including those produced from fossil fuels which worsen the climate crisis. It will also add a new category of smart gas grids, which allow local gas grids to use more hydrogen and biogas; and continue to facilitate so-far unproven carbon capture and storage projects.

The proposal maintains the central role of Europe’s gas grid industry in selecting infrastructure projects and identifying gaps in Europe’s energy infrastructure network. NGOs have complained repeatedly of excessive corporate influence in prioritising energy projects selected for EU support.

Friends of the Earth Europe is demanding that the European Commission exclude all projects that support fossil fuels, including fossil hydrogen, and that the European fossil gas transport industry be removed from the decision-making process.

Hydrogen strategy

On Monday (14 December), EU energy ministers are expected to adopt conclusions on Europe’s hydrogen strategy. The strategy, which was proposed by the European Commission in July, was criticised by Friends of the Earth Europe for failing to rule out support for hydrogen from fossil fuels and creating new vested interests.

Ministers are expected to emphasise the need to boost renewable hydrogen over fossil hydrogen and to invest in local hydrogen grids, rather than creating a pan-European hydrogen network.

Problems with hydrogen

• Hydrogen is not a clean or a dirty source of energy – it is a vector to store and move energy. The issue for the climate is carbon. If the production of hydrogen releases CO2, as with the 99% of hydrogen made by splitting methane gas, it worsens global warming.
• The fossil fuel industry claims that it can in future capture and store the carbon when it produces hydrogen (so-called ‘blue hydrogen’). In reality, the large-scale and secure storage of carbon remains unproven and uneconomic.
• Hydrogen is not energy efficient. When compared to its alternatives, both fossil and renewable hydrogen are very energy intensive and expensive. Five times more wind or solar farms would be needed to heat our homes with hydrogen than if we were to heat them directly with electricity using a heat pump.
• The fossil fuel industry has a big stake in hydrogen. Hydrogen Europe, the industry lobby organisation, includes oil and gas majors like Total and Shell, and gas grid operators. Hydrogen helps the fossil fuel industry look like they are part of the solution to the climate crisis, rather than the problem.
• Promoting expensive hydrogen infrastructure comes as the expense of more important energy solutions – energy efficiency, replacing fossil fuels in the power, heating and transport sectors with renewable alternatives, and electrifying as much of the heating and transport sectors as possible.

Next steps

After the European Commission releases its TEN-E proposal on Tuesday 15 December, MEPs and EU energy ministers will agree their separate positions on it by next summer before entering negotiations to finalise the law.

MEPS in the energy committee will finalise their position on the European Commission’s European Hydrogen Strategy early next year.