ACM: gradual development and regulation of hydrogen infrastructure

The production, transmission and use of sustainably produced hydrogen are still in their infancy. However, sustainable hydrogen is expected to play a major role in the future supply of energy and in achieving the climate goals in 2050. That is why, in the coming years, important choices must be made regarding the creation of hydrogen infrastructure, and about the possible regulation of that infrastructure. The Netherlands Authority for Consumers and Markets (ACM) wishes to share its ideas in this discussion. In its publication ‘Development and regulation of hydrogen infrastructure’, ACM argues in favor of a gradual development of infrastructure for the transmission of hydrogen. In addition, ACM is in favor of a flexible yet predictable regulatory regime for such hydrogen infrastructure, depending on the question to what extent there are any market problems.

In order to keep the energy transition affordable, it is important that overinvestments in hydrogen infrastructure are avoided as much as possible. That is why ACM makes the case that infrastructure should be developed with an eye to its future utilization based on a thorough substantiation of the benefits of and need for hydrogen pipelines. Besides the development of new infrastructure, reusing existing gas pipelines seems to be a viable option for keeping costs under control.

With regard to the future regulatory regime for the hydrogen infrastructure, ACM is in favor of an approach that easily adapts to how the market and infrastructure for hydrogen evolves. ACM finds it important that market participants, especially in the development phase, are given leeway to launch initiatives. In that context, the risk of abuse of market power should be mitigated. That is why ACM argues for a sound monitoring system of the hydrogen market so that oversight can be introduced, when such is necessary, on the basis of pre-specified criteria (preferably at a European level).

See also

22-07-2021 ACM paper ‘Development and regulation of hydrogen infrastructure’ (in Dutch)