Policy and regulatory developments

Green hydrogen will play an important role in global efforts to decarbonize carbon intensive sectors (such as transport, production and manufacturing) and the global ambition to achieve net zero by 2050.

According to the International Energy Agency, if the world is to succeed in limiting the rise in global temperatures to 1.5 degrees Celsius by 2100, it will require a complete transformation of how we produce, transport and consume energy.1 This will require a concerted effort by all countries to transition away from activities which produce greenhouse gasses. Individual countries' ability to do so will depend on a number of factors including access to funding, the technology which is available in each country, existing infrastructure, and access to renewable sources of electricity.

To create an environment which is conducive to positive change, governments must establish legal frameworks that attract investment and promote development. This will require the formulation of supportive policies and laws that create certainty and predictability. These policies and laws will form the legal basis for any contractual arrangements between governments in countries hosting green hydrogen projects and project developers.

This brief considers the key characteristics of good practice legal regimes to support governments that wish to formulate policies or establish legal frameworks to regulate the production, marketing, and distribution of green hydrogen. It comprises three parts.

First, by way of introduction, it provides a high-level summary of the status of green hydrogen policies across the world. Following the brief analysis, this section then identifies the international good practice characteristics decision makers may consider in designing green hydrogen policies.

The second section of the paper considers international good practice characteristics of legal frameworks. Currently, only a limited number of countries and regions have adopted laws to regulate the production of hydrogen. Often, these frameworks do not specifically address the production of green hydrogen. In light of this, this paper does not consider the approach followed by the different jurisdictions. Instead, it focusses on the general characteristics of good-practice legal regimes. Owing to the universal nature of the characteristics, it is recommended that the governments use the general characteristics as guidelines in preparing domestic green hydrogen laws and regulations.

To further support governments, this section of the paper also identifies the key parts of the green hydrogen value chain which ought to be regulated under the laws and regulations.

Finally, the annex to the paper provides summaries of the green hydrogen policies which specific regions and countries have developed and, where relevant, the laws and regulations which they have adopted and published.