9. The hydrogen regulatory landscape
The report consists of a study of the hydrogen energy law and regulations across several countries. It presents the regulations related to hydrogen technologies in different scenarios/applications during the entire hydrogen life cycle. It presents main findings and guidance with regard to hydrogen regulations complementing the review study on hydrogen safety and risks under the Outputs of Component B of the project.1
The review section on hydrogen safety regulations summarises and discusses existing (mandatory) regulations in ten countries: Australia, China, England, France, Germany, Japan, the Netherlands, Norway, the Republic of Korea and the United States. An introduction to each hydrogen legal framework is provided. The review investigates regulations falling into six distinct scenarios or Value Chain elements (outlined below) selected at the behest of the Dutch Ministry of Economic Affairs and Climate Policy. They are of particular interest as they cover use of hydrogen technology in densely populated areas requiring specific safety and risk management measures.
Scenario 1 – Production: hydrogen leakage from pipes connected to electrolysers;
Scenario 2 – Transport pipelines: hydrogen leakage from high-pressure pipeline;
Scenario 3 – Road transport: hydrogen leakage in confined spaces/built environments;
Scenario 4 – Mobility and partially confined spaces: examples of this scenario include a hydrogen city bus driving in a tunnel is involved in a collision traffic accident;
Scenario 5 – Mobility and partially confined spaces: accidents (ISO, 2020[1])2 at a hydrogen refuelling station;
Scenario 6 – Domestic use: safety of hydrogen in buildings with focus on hydrogen cooking stoves and boilers.
From the review, it appears that:
There is no dedicated regulatory framework in most of the countries for most of the scenarios/applications analysed. However, in some countries guidelines for the safe use of hydrogen in some scenarios/applications, like e.g. refuelling stations, are published. Moreover, international codes and standards for hydrogen equipment and installations and national codes and standards for some scenarios/applications have been developed in some countries.
Hydrogen production via electrolysis, as a more mature and well-developed technology, has a more concrete legal framework compared to the rest of the scenarios.
Domestic use of hydrogen is the application with the least specific regulations in the countries analysed as well as the least developed economic or environmental case.
Several countries intend to revise their legislation and amend it for hydrogen in the coming years according to their strategic roadmap for hydrogen.
There are multiple levels of authorities and an absence of a unified permit system, and this may hinder the energy transition. Integration and simplification appear highly desirable.
There is clear need for harmonisation and consistent approaches to the hydrogen safety regulations and permitting processes. International co-operation between national regulators would facilitate the use and faster adoption of hydrogen-based technologies.
The review of regulatory framework across countries revealed the absence of a specific regulatory framework for hydrogen applications in the countries considered. Several countries intend to revise their legislation or amend it to take account of the increased deployment of hydrogen according to their respective strategic roadmaps for hydrogen. From the country-specific review, strengths and weaknesses on regulatory aspects emerged that enable and hamper, respectively, the energy transition to hydrogen. These are summarised (Box 9.1).
Strengths
Australia has already developed a number of hydrogen projects relating to all the different parts of the hydrogen life cycle. These projects are providing valuable information to policymakers to support, complement and enhance the pathway to realising the country’s considerable potential in hydrogen. It is anticipated that the legislation will be amended by 2023 subject to federal and territorial government processes and approvals to better incorporate and clarify requirements for hydrogen, including formalised standards.
China shows a good practice of developing a set of technical regulations and standards. The establishment of technical regulations helps to prevent market failures. It has hydrogen specific, legally binding technical regulations for 4 of the 6 scenarios of the H2 value chain considered here and has recently developed one standard regarding hydrogen use in domestic settings. Regarding scenario 4 &5, its technical regulations were updated and improved after 2020 that is a few years after its implementation of large-scale hydrogen projects. In addition, regarding scenario 1-5, the country also developed a set of not legally binding national standards that reflect the lessons learnt from its hydrogen practices.
In England, hydrogen is currently a nascent area of energy policy, with the industry looking to the UK Government to provide capital and revenue support, regulatory levers, and incentives. There is still reliance on existing high hazard gas management law and regulation. The good practice is that the Government has launched a Hydrogen Strategy for a hydrogen transition putting hydrogen development as a priority.
France’s hydrogen regulatory framework is improving in order to meet the objectives set in the national strategy plan until 2030. In 2021, the first French text to create a legal regime for hydrogen was created. Hydrogen production is now divided into three categories; renewable hydrogen (including water electrolysis hydrogen), low-carbon hydrogen (a CO2 emission threshold must be reached for hydrogen to be considered renewable or low carbon) and carbon-based hydrogen (the hydrogen produced with fossil fuels). This is of course the recognition that hydrogen production needs to be fully and attentively discerned. Additionally, France developed technical regulations for the use and layout of HRSs, for instance under Order 22/10/18 to promote safety and environmental protection.
Germany's energy transition is progressing. This can be witnessed through legislative changes for pipeline transport and for increased incentives for increasing HRS. Good practices from Germany include vesting the power for permitting at the local level with the individual states (Länder). States are considered best equipped to handle the unique challenges that may arise due to local environment, industry, safety etc. Digitisation of application process has already begun which helps in speeding the permit time.
Japan has the advantage of having designated government policy, including “Strategic Roadmap for Hydrogen and Fuel Cells” (2011) and “Basic Hydrogen Strategy” (2017) formulated by the government and supporting the uptake of hydrogen, coupled with a public acceptance of hydrogen projects in the domestic-energy mix. The government is tackling deregulation for hydrogen stations for the popularisation of hydrogen fuel cell vehicles, and technical standards for hydrogen stations that allow customer/drivers to self-refuel. Arrangements for hydrogen tank fuelling - self-service hydrogen stations - were added to Article 7-4 of the GHPGSO in 2020. In 2018, the Japan Petroleum Energy Center (JPEC) released the Self-hydrogen Station Guidelines (JPEC-TD 0004). In the sector of hydrogen domestic use fuel cells that are released for such purposes (though not limited to hydrogen) are subject to the Fire Service Act and the Electricity Business Act.
The Netherlands is demonstrating good practices in hydrogen technology development and makes forward steps for the development of national regulatory regime. There is a lot of legislation; however it does not everywhere sufficiently take into account hydrogen as an energy carrier for the energy transition. There are general restrictions within the broader Dutch regulatory framework and two very particular hydrogen regulations, the PGS35 for hydrogen fuel stations and the requirements for hydrogen fuel cells (soft law), are published. Even though, there is essentially no single comprehensive piece of legislation for new hydrogen usage in the energy transition the Netherlands Hydrogen technology development is on its way and pilot and demonstration projects are ongoing. This development is also receiving positive support from the local population and public acceptance is a key factor in accelerating the deployment of new technologies. In line with the 2021 OECD recommendations on agile regulatory governance to harness innovation (6 October 2021), successful, future-proof regulation can only be developed in cooperation with other national jurisdictions and stakeholders.
In Norway, in addition to a national framework, the municipality is responsible for permitting related to hydrogen projects and for coordinating with other authorities as it sees fit. This is a good practice because the municipality is best aware of the local conditions. Further, the municipality is responsible for consulting other regulatory agencies when it deems fit. This reduces uncertainties for the operator who only needs to make the application before the municipality and not to individual agencies.
The Republic of Korea not only declared ambitious plans for hydrogen inclusion into its economy by a specified date but puts all best efforts to achieve these plans by establishing a legal framework for permitting, where local government is involved, developing hydrogen specific technical standards, providing a wide range of state support to businesses willing to participate in hydrogen development. There are a number of hydrogen pilot projects on the basis of territorial economic zones, provided with a variety of incentives. Big market players like Hyundai as well as state utility companies actively participate in such projects. Also, the Government actively supports foreign partnership and knowledge exchange as well as local knowledge hubs involvement.
The regulatory landscape in the United States largely depends upon the adherence to codes and standards. Different states and local legislations have developed different requirements. An exception can be found in the California Fire Code which was developed by the state of California to provide a set of rules for hydrogen refuelling stations. The rules included in the California Fire Code are sufficiently comprehensive: they include requirements for dispensing systems and approved equipment and list separation distances.
Weaknesses
There is currently no legal framework in Australia targeted specifically at hydrogen production, transport, or domestic use. The existing legal framework requires to be adjusted.
The Chinese hydrogen sector heavily relies on government subsidies, and this is unfortunately not a sustainable long-term driving force. Therefore, a better and more supportive regulation regime is required for sustainable growth in the sector. Furthermore, since many stakeholders are involved in the permit-issuing process for hydrogen-based technologies, the process can be slow and hinder private investment. It is estimated that for a small-scale hydrogen station, it would take up to 6-8 years for the investor to recover his investment and for a petrol station, it would take up to 2-3 years.
There is lack of dedicated regulatory and policy structure in England. Dedicated hydrogen legislation and policy lag behind the initial implementation of low-carbon hydrogen production that can be seen only in some areas. This means that elements of the hydrogen production, transport, storage, and distribution process often fall within the scope and remit of various other rules and regulators, while other aspects remain without clear or specific regulation.
France’s energy transition is progressing, but some gaps are present and need to be filled to keep pace with hydrogen technology and facilitate its use. The French legislator has not yet associated the notion of “manufacture in industrial quantities” in hydrogen production installations subject to environmental regulations of ICPEs with a specific numerical threshold which therefore could be strengthened.
In Germany, despite the initiatives, legislation is lagging, and authorities do not have regulatory support or technical expertise to efficiently handle the hydrogen transition.
In Japan, hydrogen has generally been used as an industrial gas, and the business environment and infrastructure to utilise it as an energy carrier has not been sufficiently developed. Existing regulations on the handling of high-pressure gas or flammable gas, such as HPGSA, consider hydrogen as a flammable gas and regulate it accordingly. These regulations are not therefore specific to hydrogen in its new context and so are not suitable therefore for the regulation of hydrogen as energy carrier.
In the Netherlands, laws of different levels of governance and practices and expertise that need to be brought together in a relatively short period of time set obstacles to a fast progress in regulating nationally the rapidly developing hydrogen technology. More efficient ways may need to be found to regulate in current circumstances, given also the 2021 OECD recommendation that there would be benefit in bringing international partners, stakeholders, and enforcement considerations onboard in order to create a regulatory regime more supportive of innovation.
Norway is yet to have a well-defined legal and regulatory framework for hydrogen projects in the scenarios described above. Legislation which can simplify development of hydrogen in the six scenarios still needs to be developed.
In the United States, both DoE and the industry recognise that there is a lack of appropriate regulations and standards, and that further research and development is necessary. The attitudes towards precaution between the United States and Europe are fundamentally different. The EU follows a more stricter approach to the precautionary principle than the United States.
Among the examined applications in this review, hydrogen production via electrolysis, as a more well-developed technology, has more mature legal frameworks. Domestic use of hydrogen has the least number of specific regulations in the countries analysed. Only China and England (UK) are the two countries that have shown effort in regulating this sector.
This next section presents a summary of the existing regulatory framework in the countries analysed for the six examined applications.
Production facilities
China has legal binding standards for the safe design and maintenance of hydrogen production stations that set restrictions on maximum allowable storage capacity, operation conditions, safety equipment, technical specifications of pipework, safety requirements, such as minimum ventilation rate, separation, and safety distances, etc. South Korea has developed codes that cover most of the above requirements for hydrogen production and storage facilities. In Japan, the above requirements of the hydrogen production facilities are set under the regulation of high-pressure gas facilities. In the United States, hydrogen production facilities are managed by the OSHA standard and NFPA-2 which among other issues defines safety and separation distances and requirements for safety systems. In Germany and Norway, permits related to building, construction and operation of the stations are required and risk assessment should be performed and submitted to the regulatory authorities’ prior operation. In France production facilities are subject to environmental regulations specific to “classified facilities for the protection of environment.”
Across the EU, notification of the regulatory authority is required for storage of more than 5 tonnes. There is a requirement to draw up a written safety policy for the prevention of hazardous accidents. Storage greater than 50 tonnes requires a safety report and emergency plan to be prepared, submitted to and assessed by the Competent Authority. In many countries, including the EU and Japan, hydrogen production, per se is not subject to any specific legislation as the focus is on the maximum stored inventory. Regulations covering high pressure or flammable gases and regulations for other gas producing facilities, respectively, are applied.
Pipelines
Regulations have been amended to allow hydrogen to be transmitted though pipelines in some countries, like Australia and Germany, while in others, like the Netherlands, the law does not provide yet the possibility to inject, transport, or distribute any amounts of hydrogen through the natural gas infrastructure under the Gas law,3 but allows it in new pipelines Thus, no pertinent regulatory framework has been developed in all countries. In UK, hydrogen transport through pipelines requires permission and must adhere to pipeline requirements for design, safety systems, construction, installation, operation, maintenance, and decommissioning as well as to industry codes. In Japan, even though the transport of hydrogen is limited to short distance uses, there are safety regulations for the pipe layout and the pipe materials. However, many of them are still being verified. In the United States, which has the largest existing gas pipeline system, regulations for flammable gases in hydrogen pipelines are applied. Finally, the American Society of Mechanical Engineers provides standards for piping and transportation pipelines and China has developed a Chinese code with general requirements that pipelines have to follow.
Road transport and mobility in confined spaces
Most countries currently apply to hydrogen the regulations that were developed for other flammable gases. Within Europe, Road transport is regulated via the ADR agreement that concerns the International Carriage of Dangerous Goods by Road. ADR requires no amendment for hydrogen as it is already fully incorporated. Australia also applies the Dangerous Goods Safety (Road and Rail Transport of Non-explosives) Regulations 2007 and the Australian Dangerous Goods Code. Training of transport company employees on the associated risks of these goods is obligatory in France.
Restrictions on transport of dangerous goods in tunnels apply within Europe based on road tunnels classified by ADR. Tank carriage of hydrogen is forbidden in tunnel categories B, C, D and E. This means that hydrogen in tanks cannot be delivered through all tunnels, e.g., in the Netherlands the transportation is allowed only in 5 tunnels. In Japan, the passage of vehicles carrying explosive or flammable dangerous goods is prohibited or restricted in long tunnels (over 5 000 m long) and underwater/waterfront tunnels. No specific restrictions were found for FCEV entering tunnels, revealing the need to develop regulations, standards, and codes for FCEV in confined spaces.
Hydrogen refuelling stations
Even though the countries analysed in this report have several hydrogen refuelling stations already deployed in their territory, a solid regulatory framework is lacking in EU countries and Australia, while Japan, China, and the United States have regulated hydrogen stations and their equipment (dispenser, compressor, storage) for both compressed and liquid stations. More specifically, Japan, which possess the largest number of refuelling stations worldwide, and China, have regulations which indicate the technical specifications of materials and equipment, prevention and mitigation measures, and detailed safety distances from site boundaries and different components of the stations, vulnerable objects as well as oxygen facilities.
The state of California in the United States, has developed a comprehensive set of rules for hydrogen refuelling stations, including requirements for dispensing systems and approved equipment (cylinder, containers, tanks, pressure relief devices, hoses, compressors, hydrogen generators, dispensers, detection systems, electrical equipment and others). Moreover, the separation distances from a hydrogen refuelling station as defined in NFPA-2 are applied. In the Netherlands, the PGS35 series has been published to provide guidelines on the design, construction, maintenance and management of hydrogen delivery installations.
In the remaining countries, in the absence of specific legislation and guidance on the permitting procedure, the variety of national and international standards and codes is followed and/or HRS facilities are compared on a par with LNG and LPG facilities. Finally, the review showed that since HRS are capable of producing and storing hydrogen at different capacities, the requirements related to land use and general operability are often unclear. For instance, in Germany, rules vary depending on whether an HRS has the ability for onsite production of hydrogen and the accompanying storage limits.
Domestic use
Hydrogen is not regulated for domestic use in most of the countries reviewed. In Australia there is no regulation allowing domestic use of pure hydrogen, because existing gas appliances are only suitable to take a blend of hydrogen (up to 10 or 20%). China’s policies and regulations support hydrogen blending in existing natural gas grids and has published a groups of standards for natural gas/hydrogen mixing stations. It is also currently completing the review on how to bring hydrogen into the gas network. In Japan and South Korea domestic use of hydrogen involves fuel cell systems. In both countries hydrogen fuel cells are subject to regulations that apply to fuel cells in general. In England, in the absence of hydrogen related rules and regulations the Gas Safety (Management) Regulations 1996 (GSMR), which concerns the flow of gas through the network are applied. Pursuant to the GSMR the concentration of hydrogen that can be injected onto the England gas network and consequently be supplied to domestic homes should be no greater than 0.1% molar volume. Currently, tests are being conducting to increase the hydrogen blend to up to 20%. If successful, the regulations will need to be amended to allow for this richer in hydrogen blends. The law in the Netherlands does not yet provide for the possibility to inject, transport, or distribute any amounts of hydrogen through the natural gas infrastructure. There are no regulations specifically targeting the domestic use of hydrogen in the United States. Such use is however not prohibited as can be seen by the existence of small-scale pilot projects.
Good practices for safety in the different hydrogen applications
For fixed installations, including pipelines, common legal safety instruments included:
Prior notification to the regulatory of the installation, activity, location, and hydrogen capacity
Licensing or prior approval (permitting) of the installation prior to operation, incorporating:
Specified safety distances from vulnerable populations, buildings – but no consensus on those distances based on hydrogen inventory or activity
Specification of design and configuration of installation, including:
The review found a wide variety of regulatory approaches across the countries assessed with no consensus as to the most efficient and effective format for a national regulatory framework. Equally, some governments have developed new specific standards and codes covering design, location and safe operation of hydrogen facilities whilst others have adopted or amended existing legal instruments, particularly those relating to compressed or high-pressure flammable gases such as methane, LPG or LNG. Similarly, some countries have developed their own national technical standards and guidelines to specify minimum standards of technical safety compliance whilst others adopted existing industry standards and codes to support minimum standards of safety compliance. These soft laws can be considered as precursors for mandatory regulations and in absence of relevant hard law they are often handled as such.
International standards that cover hydrogen production via electrolysis, technical specifications for storage and transportation, detection apparatus, installation and operation of refuelling stations, and others are already available. Australia has released a set of standards on hydrogen quality, storage, transportation and usage that are currently being applied. China has published 31 national standards regarding hydrogen, covering its full life-cycle, while South Korea has developed its own codes for refuelling stations. The Netherlands has also published PGS35 series to provide regulations on the design, construction, maintenance and management of hydrogen delivery installations.
The fragmentation of the regulatory and standardisation framework for hydrogen applications across different countries can be attributed to the following elements:
different uses of hydrogen. Hydrogen can be a chemical feedstock, a chemical process gas, or a gaseous or liquid energy carrier.
national, European and international regulations covering the safety of chemical industry processes, supply chains of flammable chemicals, and of handling fuels already exist.
depending on the specific hydrogen applications, its handling is covered by existing RCS framework.
permitting authority can vary depending on the application, e.g., for the sectors geographically determined, as in the case of delivery infrastructure, the authority is locally determined. In the case of applications which concern global trade, such as FCEV, global consensus mechanisms have been put in place to harmonise safety requirements and facilitate adoption worldwide.
RCS harmonisation has been attempted in the past, and in several cases failed, for the reasons above. Common internationally methodologies might conflict with already existing national regulations covering a broader set of hazards and other fuels, which cannot be changed a posteriori.
Some good progress is being made in developing practices, codes, policy, and regulation and this should be continued if market opportunities and strategic needs as well as stated development plans are to be addressed and realised. The key areas for development might be production, storage and distribution. Hydrogen production via electrolysis has more mature legal frameworks compared to other applications, while domestic use of hydrogen has the least number of specific regulations in the countries analysed.
Technical regulations managing related hazards (flammable/explosive) are broadly relevant and are being used and revised in the light of developing data, technology, and market knowledge in order to fill the current regulatory gaps. Given the hazard context, very good progress has been made in several segments of the hydrogen life cycle and value chain, with the domestic heating component being the least well developed and facing the biggest challenges in terms of engineering and public acceptance. Other segments are already close to market or already in place, requiring regulatory refinement and a growth in the necessary investment support and planning and delivery processes for wider roll-out.
Multiple levels of authorities and an absence of a unified permit system first at national level and later on at international level might slow down the energy transition. Laws with simplified administrative procedures will facilitate the construction and operation of hydrogen infrastructure. It is essential to develop a proportionate and consistent regulatory framework not only to build a level of trust with investors and reduce uncertainty about legal compliance but also to promote a sustainable development of the hydrogen energy industry. The existing international standards and national codes can provide useful guidelines for policymakers and can contribute to the development of regulations.
From the review in the countries analysed in this report some good and bad practices were identified, which could be better considered as early strengths and weaknesses/gaps. Some appear to be good developments preparing for appropriate policy and regulation as knowledge deepens. Others are just reflections of the current state of development of technology, policy and regulation or even reflection of the national cultures and current or perceived industry, regulator and/or public concern.
perform risk assessment to be granted building and operation permits for facilities that store hydrogen above a specified volume amount. The publication of a risk guidebook at national or international level would provide greater levels of confidence and would accelerate the process.
rest the power for permitting at the local level with the individual states. States are best equipped to handle the unique challenges that may arise due to local environment, industry, safety etc. It should be stated that for effective permitting state authorities should have adequate skill development, and mechanisms for improved coordination and communication between the different authorities including through digital tools is necessary.
digitisation of application process for permitting to speed up the permit time.
develop regulations in cooperation with other national jurisdictions and stakeholders.
develop sufficiently comprehensive codes and standards for equipment and applications that are not covered by existing codes and standards.
lack of dedicated regulatory and policy structure as well as technical expertise to efficiently handle the hydrogen transition.
laws of different levels of governance and practices and expertise that needs to be put together in a relatively short period of time.
in hydrogen production facilities there is often no legal or administrative distinction between localised and centralised production and also no distinction among the different production processes. This hinders building production facilities onsite hydrogen refuelling stations and as a result, permitting obstacles for simplified processes, zoning, and permitting requirements arise.
It should be noted, though, that several countries intend to revise their legislation to take account of the increased deployment of hydrogen according to their strategic roadmap for hydrogen.
There is a clear need for consensus and consistent approaches to the regulation of hydrogen in the technologies involved in the energy transition and international co-operation between national regulators would facilitate common technologies and safety systems. EU legislation would also facilitate transportation and trade across countries. It is clear, though, that this is a quite challenging task as already existing national regulations covering similar applications (e.g., handling of fuels or safety of chemical industry processes) could conflict with the new hydrogen regulations and careful revision might be required. Clear and less complex permitting processes should be developed that would reduce the time required for approval. Regulations, standards and codes should be revised regularly based on innovations and technology advancements in equipment and safety devices and on evidence-based improved knowledge.
Finally, guidance material and special training programmes4 for H2 fires and hazards should be designed and distributed to fire authorities. In the sector of hydrogen vehicle mobility, such as parking and tunnel use it is crucial to develop regulations, codes, and standards and an international programme and training for first responders and emergency services, as currently FCEVs are not distinguished from other vehicles.
Reference
[1] ISO (2020), ISO 19880-1:2020(en), https://www.iso.org/obp/ui/fr/#iso:std:iso:19880:-1:ed-1:v1:en:term:3.53.
Notes
← 1. Component B of the project aims at consolidating and improving knowledge in relation to the safety risks associated to the use of hydrogen, and, on this basis, develop recommendations and guidance with regard to adequate risk-management in the application of hydrogen in different scenarios, and to the development of appropriate regulations and regulatory processes for the use of hydrogen. An extensive literature review, review on hydrogen pilot projects across several countries, review on hydrogen incident database, targeted risk assessments and this output on regulatory review across several countries will be the basis for the final output with guidance materials for permit-issuing authorities.
← 2. The ISO/TS 19880-1:2016 defines incident as any “unplanned event that resulted in injury or ill health of people, or damage or loss to property, plant, materials or the environment or a loss of business opportunity.” For the purpose of scenario 5, accidents also include incidents as defined in the ISO. https://www.iso.org/obp/ui/fr/#iso:std:iso:19880:-1:ed-1:v1:en:term:3.53
← 3. The Gas law, applied in natural gas pipelines, does not allow injection of hydrogen and thus it is currently illegal to transport hydrogen in existing natural gas infrastructure. However, in new pipelines hydrogen transportation is allowed based on the Pipeline Decree.
← 4. Within the EU funded project, HyResponse, the first comprehensive training program for first responder for safer deployment of FCH systems and infrastructure has been developed. There is also a follow up EU-funded project, HyResponder which aims to develop and implement a sustainable trainer the trainer programme in hydrogen safety for responders throughout Europe, supporting the commercialisation of hydrogen and fuel cell technologies by informing responders involved in the permitting process, improving resilience and preparedness, and ensuring appropriate accident management and recovery.