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DRAFT REPORT (COM(2021)0804 – C90470/2021 – 2021/0424(COD))

On the proposal for a regulation of the European Parliament and of the Council on the internal markets for renewable and natural gases and for hydrogen (recast)

ITRE-PR-734108

Committee on Industry, Research and Energy · Rapporteur: Jerzy Buzek

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Written by a language model from the full text only; every figure comes from the text. The paragraph links open the paragraph a statement rests on — check the text itself before relying on it.

This is the rapporteur's draft report on the proposed regulation on the internal markets for renewable and natural gases and for hydrogen (recast). It adopts Parliament's first-reading position with amendments. The amendments add new rules: a cap on pipeline gas imports from any single third country, a biomethane production target, and support for renewable and low-carbon gases in coal and carbon-intensive regions. They rename the ENTSO for Gas as the joint EU organisation of Gas Transmission System Operators and Hydrogen Network Operators (ENTSOG&H) and delete the planned ENNOH, giving the new body hydrogen tasks. They also change tariff discounts, gas quality and blending rules, joint gas procurement, and gas storage provisions in Regulation (EU) 2017/1938.

Committee position. The rapporteur proposes to adopt Parliament's first-reading position with amendments. The main lines are to cap gas imports from single third countries, boost biomethane, support renewable and low-carbon gases in coal regions, and replace the planned ENNOH with a joint ENTSOG&H.

Key points

  1. A new recital says the regulatory framework must address risks of volatility and dependence on external suppliers, and import infrastructure must diversify routes and suppliers.
  2. A new Article 3a requires each Member State to ensure pipeline natural gas from any third country does not exceed 33% of its annual imports by 31 December 2026 and 25% by 31 December 2029, excluding EEA imports.
  3. A new Article 3b requires Member States to ensure collectively at least 35 bcm of biomethane is produced and injected into the natural gas system by 31 December 2030.
  4. A new Article 3c requires the Commission to support renewable and low-carbon gases in coal and carbon-intensive regions through financial resources, phase-out support, reskilling and fast-track hydrogen valleys and IPCEI projects.
  5. Amendments allow financial transfers between regulated services only in exceptional cases, with charges collected from exit points and interconnection points under regulatory agreement, and prohibit market distortions.
  6. Amendments raise the tariff discount for renewable and low-carbon gas production facilities to 100%, allow regulatory authorities to grant up to 100% discounts at storage and LNG entry and exit points, and replace the interconnection-point discount with an assessment of grid connection costs.
  7. Amendments set a 2% hydrogen blend limit for applying gas quality rules, require Member States not to use diverging technical specifications to restrict cross-border flows, and delete the article on hydrogen blends at interconnection points.
  8. A new Article 20a empowers the Commission to adopt implementing acts or network codes laying down common specifications for biomethane.
  9. Amendments rename the ENTSO for Gas as the joint EU organisation of Gas Transmission System Operators and Hydrogen Network Operators (ENTSOG&H), include hydrogen network operators in its membership, and delete the planned ENNOH and its articles.
  10. Amendments set rules for ENTSOG&H statutes and board composition, require a stakeholder consultation, and give it tasks including a gas and hydrogen network development plan, quality monitoring reports and cyber security promotion.
  11. Amendments revise Regulation (EU) 2017/1938: they delete the strategic stock definition, allow full integration of storages into transmission networks, set a common withdrawal procedure, and make joint gas procurement a voluntary mechanism open to designated undertakings and market participants.
  12. A new Article 7ea creates European Energy Security of Supply Projects, with ENTSOG&H analysis, a project list, cost-benefit evaluation and fast-track permitting through a single national competent authority.

Who is affected

  • Member States, which must enforce the import cap, biomethane target and gas storage rules.
  • Gas transmission system operators and hydrogen network operators, which join and run the ENTSOG&H.
  • Regulatory authorities and ACER, which decide on discounts, transfers and cross-border coordination.
  • Biomethane and renewable gas producers, who benefit from common specifications and grid connection mapping.
  • Final gas customers, whose rights must be considered in gas quality requirements.

Figures and deadlines

  • 33% of a Member State's annual natural gas imports from any third country by 31 December 2026.
  • 25% of a Member State's annual natural gas imports from any third country by 31 December 2029.
  • At least 35 bcm of biomethane produced and injected by 31 December 2030.
  • Maximum capacity contract duration of 20 years for existing infrastructure and 15 years for infrastructure completed after entry into force.
  • Tariff discount of up to 100% at storage and LNG entry and exit points.
  • Discount of 100% for renewable and low-carbon gas production facilities.
  • Hydrogen blend limit of up to 2% by volume for applying gas quality rules.
  • Gas quality monitoring report by 15 May 2024 and gas and hydrogen quality report by 15 May 2026.

Legal basis: Article 294(2) and Article 173(3) of the Treaty on the Functioning of the European Union.