Poland Proposes Legal Framework for Hydrogen Market

Key Legislative Developments

The newly proposed law introduces several significant changes to Poland's energy sector, primarily focusing on integrating hydrogen into the national energy mix as a renewable and low-emission fuel. The legislation broadens the definition of fuel to include hydrogen, thereby subjecting it to the same regulatory regime as other fuels. This includes the legal parameters around the sale and distribution of hydrogen, as well as its generation and supply within the country.

Key elements of the proposed law include

1. Infrastructure and Market Regulation

• The law defines various entities and systems within the hydrogen market, such as operators of hydrogen systems, hydrogen transmission and distribution networks, and hydrogen storage facilities. These definitions establish the foundational legal framework necessary for the operation and regulation of the hydrogen market in Poland.
  
• It specifies the rights and responsibilities of market participants, including energy companies and the President of the Energy Regulatory Office. The law mandates certification and appointment of hydrogen system operators, detailing their duties and the rules governing ownership separation within the hydrogen sector.

2. Cross-Sectoral Use and Investor Environment

• The legislation allows for the cross-sectoral use of hydrogen infrastructure, providing a predictable regulatory environment for investors. This is achieved by enabling the operation of both natural gas and hydrogen within a single system managed by a unified operator.
  
• It introduces provisions for the sharing of infrastructure between gas and hydrogen distribution network operators, thereby optimizing the use of existing assets and facilitating the development of hydrogen storage installations.

3. Market Conditions and Environmental Compliance

• To support the EU's "Do No Significant Harm" principle, the law differentiates between various types of hydrogen—low-emission, renewable non-biological, and renewable hydrogen. It ensures favorable conditions for renewable hydrogen by prioritizing its integration into the energy network and offering reduced connection fees, thereby promoting its use over other hydrogen sources.
  
• The law also includes provisions for geographically limited hydrogen networks, providing legal advantages to these specific infrastructures and setting out guidelines for their regulation and monitoring by the Energy Regulatory Office.

4. Alignment with EU Hydrogen Strategy

• The proposed law aligns with the broader EU Hydrogen Strategy, promoting the production and use of renewable and, temporarily, low-emission hydrogen. It supports the implementation of investments in hydrogen technologies as outlined in the National Recovery Plan, particularly those related to the production, storage, and transportation of hydrogen.
  
• The regulation is expected to boost Poland's competitiveness in the hydrogen economy, contributing to the country's energy security, job creation, and reduction of greenhouse gas emissions.

Strategic Importance and Future Implications

This legislative effort is a crucial step in Poland's transition towards a more sustainable and resilient energy system. By fostering the development of a domestic hydrogen industry, the law is poised to increase the share of renewable energy sources in the energy-intensive sectors of industry, energy production, and transportation. It will also enhance Poland's energy security by establishing hydrogen storage facilities, which are critical for ensuring a stable energy supply.

Furthermore, the introduction of this law is expected to create new employment opportunities and reduce air pollution by promoting the use of hydrogen in various sectors, thereby contributing to Poland's climate goals. 

In summary, Poland's proposed hydrogen law represents a vital component of the country's National Recovery Plan, aligning with EU strategies to create a robust hydrogen economy. This legislative framework is set to drive significant advancements in renewable energy utilization, supporting Poland's long-term sustainability and economic growth.