European policies and regulations, such as REDII(I) and CBAM, are rapidly changing the European hydrogen landscape. Through targets and carbon taxes, they will increase demand for renewable and low-carbon hydrogen. If fulfilled, these targets could lead to a significant demand for RFNBO-hydrogen (compliant ‘renewable’ hydrogen in the EU market) by 2030. Next to this, other types of hydrogen can be used to fulfil specific targets set by REDII(I), FuelEU Maritime and ReFuel Aviation (e.g. in biofuels, non-fossil low carbon fuels or recycled carbon fuels). These targets (together with EU ETS/CBAM) will likely lead to (the need) for import of hydrogen and hydrogen derivatives such as ammonia and methanol.
Hydrogen can be traded through different commodity and assorted certificate products. For RFNBO-hydrogen to be defined as such, several rules are to be complied with, eg. additionality, temporal and geographical correlation and a 70% GHG reduction requirement as compared to a fossil comparator. An according Proof of Sustainability (PoS) certificate has to be issued by the economic operator and traded together with the commodity (mass-balance principle) in order to provide evidence for the product’s sustainable provenance (the primary trading market). A nationally authorized body certifies the PoS and issues an RFNBO ticket, that can be used directly to comply with sustainability quotas (for quota obligated parties) or they can be sold independently from the commodity product to other obligated parties on a secondary trading market. This secondary market is therefore able to drive RFNBO demand by integrating them at lowest cost in the market through optimized trading of certificates. Next to RFNBO, low-carbon certificates can be issued in the same way on the compliance market, and both are deemed to be of high value.
Besides the compliance market, a different class of certificates can be traded on the voluntary market, ie. Guarantee of Origin certificates or voluntary (non-governmental) certificates. They differ from compliance market trading principles insofar that they follow a book-and-claim chain of custody, ie. their Proof of Origin certificates (provided by Issuing Bodies) are traded separately from the physical commodity product, and they are used for disclosure (of lower value) as compared to compliance (of higher value). HyBex is the hub platform linking together all the key players of this value chain from hydrogen producers and consumers to the underlying infrastructure, a balancing market and the national/regional certification registries and issuing bodies.
