Clarification—renewable hydrogen production licensing

Background

The Directorate-General for Energy and Geology issued Order 13288-B/2023 of December 29 (“Order 13288-B/2023”). The order aims to clarify the licensing procedure for the industrial activity of producing renewable hydrogen.

Order 13288-B/2023 is a response to the changes in the European and Portuguese normative and regulatory framework aimed at promoting the use of renewable energy. These changes particularly focus on renewable gases—such as renewable hydrogen—and impact the conditions under which hydrogen can be considered renewable.                                              

The order also aims to provide an opportunity for producers in the initial phases of their projects to demonstrate that hydrogen generated through water electrolysis using renewable energy can be qualified as renewable hydrogen.

Objectives of Order 13288-B/2023

The primary objective of the order is to simplify the process for competent administrative entities to determine whether a given hydrogen production project qualifies as renewable hydrogen. To this end, project developers are required to submit a declaration of commitment.

Procedure description

The procedure for developers consists of filling out a declaration form—included in the annex to Order 13288-B/2023—in which they undertake to:

·         comply with the requirements for using renewable energy and with the delegated acts of the current directive to ensure that the hydrogen produced is renewable in origin; and

·         monitor the progressive entry into force of the requirements established in the above delegated acts and ensure compliance with them once they become applicable to the renewable gas production facility in question.

Before starting the production of renewable hydrogen, and for the “digital certificate for setting up and operating the industrial establishment” to be issued, the applicant must provide evidence of the connection between the renewable electricity production and the electrolyzer or the power purchase agreement entered into for the acquisition of the renewable energy it will consume in the production process. This evidence must unequivocally demonstrate that the commitments made in the declaration have been fulfilled.

Non-compliance consequences

If the commitments made in the declaration are not fulfilled, the “digital certificate for setting up and operating the industrial establishment” will not be issued. Moreover, the applicant will be held liable for any false statements it made in the declaration and will face all legal consequences.

Entry into force

The order became effective on December 30, 2023, the day after it was published in the Official Gazette of the Republic of Portugal. The order ratifies all valid acts carried out in the meantime under Order 30/2023 of July 13, 2023.