Consultation Response – Rules for RFNBO and RCF production

Bellona Europa welcomes the ongoing efforts by the European Commission, and the invitation to provide views, feedback and recommendations on the published draft proposal to the Delegated act on the method for assessing greenhouse gas emission savings for recycled carbon fuels and renewable fuels of non-biological origin. We welcome the intention of the Commission to assess all fuels according to their full impacts across their entire lifecycle.

In order to ensure emission reductions and create a robust and transparent accounting system, the methodology outlined in this delegated act must reflect the entire carbon intensity of the fuels produced. This intention is not only vital for keeping climate ambitions, but also to deploy sufficient additional renewable sources to ensure energy security and fair energy prices for European consumers.

  1. Delegated act on the method for assessing greenhouse gas emission savings for certain fuels
  • Positive aspects of the draft DA:
    • The proposal outlines measures that intend to take into account full life cycle emissions, which is commendable as it aims to illustrate the full impact of the fuels produced (Recital 4).
    • The minimum greenhouse gas emission saving threshold of 70% should indeed be set for all types of recycled carbon fuels, in accordance with emission reduction goals for other fuels and overall climate targets (Recital 2, Article 2).
    • Double counting of emission reductions from CO2 captured should be avoided (Recital 5) to ensure that any possible emission reduction resulting from the permanent storage of CO2 is recorded only once.
  • Negative aspects of the draft DA:
    • Double counting renewable electricity: Not only does the DA provide a way out of additionality, but it also enables double counting of renewable electricity (e.g., counting both PPA solar and the yearly average RES penetration). This should be addressed in the Delegated act on the electricity use for RFNBO production (e.g., by expanding Recital 14 on double counting of RES).
    • Enabling accounting flexibility and therefore grid connection: it creates an incentive for electrolysers to run the longest possible amount of hours and be as inflexible as can be; producers can cherry pick every hour which accounting method yields them the most renewable or low-carbon hydrogen, which incentivises never turning production off. This is now possible, despite hydrogen being initially foreseen as a way to capture excess renewable electricity production.
    • Unfair competition between member states: Member states that do foresee additional renewable electricity generation to be dedicated to hydrogen production will be disadvantaged compared to member states where electrolysers will be running with a direct connection to the electricity grid with mixed energy sources. The origin of carbon used for the production of renewable liquid and gaseous transport fuels of non-biological origin and recycled carbon fuels should not be disregarded in the short to medium term because it could disincentivise emission reductions at fossil point sources. In other words, if there is a demand for fossil carbon sources, there will be no incentive to reduce emissions in the short to mid-term (e.g., by changing the production process or capturing and permanently storing CO2). Given the near term actions required to meet climate goals and long investment cycles in energy intensive industries, disregarding the source of carbon in the short or mid-term is detrimental. Therefore, fossil carbon should automatically be differentiated from atmospheric carbon, both for the production of RFNBOs and RCFs.
  1. Delegated act on the Production of renewable transport fuels – share of renewable electricity (requirements)
  • Positive aspects of the draft DA:
    • Article 4 of the “additionality” delegated act creates a system that allows for hydrogen to be supporting the energy transition: 1. The requirement of establishing PPAs with newly deployed unsubsidised renewable generation prevents hydrogen from cannibalising existing renewables from the grid. 2. The requirement of hourly matching between renewable generation and hydrogen production ensures that renewables are consumed when they are available, helping with the integration of non-dispatchable renewables in the power system. The requirement of locating renewable generation and hydrogen production nearby each other ensures that there is an actual flow of electrons between the two facilities.
  • Negative aspects of the draft DA:
    • However, the positive aspects related to additionality are not safeguarded as all the installations built before 2027 will not have to support any new deployment of renewables at any point of their operating life. With a normal transitional period, these electrolysers would need to provide additionality at a later stage. This would enable them to ramp up production in the early stages and comply with additionality at a later stage. However, with the grandfathering clause in place, those pre-2027 electrolysers will never have to comply with additionality.

Find our specific recommendations to these two delegated acts here: Consultation Response – Rules for RFNBO and RCF production

Our consultation responses are also available on the website of the European Commission: