Hydrogen Act – framework for businesses

by Przemysław Rogiński

28 February 2025

TABLE OF CONTENTS

What is the Hydrogen Act?
Key hydrogen regulations in Poland and the EU
Changes in the Energy Act after 20 January 2025
Support for the hydrogen economy
Summary

What is the Hydrogen Act?

The Act amending the Energy Act and some other acts of 21 November 2024, called Hydrogen Act, came into force on 20 January 2025. This way, Poland – the third largest hydrogen producer in Europe and the fifth worldwide – obtained a legal framework for the hydrogen sector. Previously, hydrogen was classified as other combustible gas, which translated into a higher investment risk and held back the development potential of the hydrogen market.

The new regulations help to comply with the RED III directive which promotes the EU’s energy transition based on renewable energy sources and also implements one of the milestones of the Polish National Recovery and Resilience Plan. The Act may position Poland as one of the leaders in hydrogen technology in Europe while, simultaneously, making it more popular with investors.

Key hydrogen regulations in Poland and the EU

Upon its entry into force, the described act became the main domestic law for the hydrogen market. The new regulation relies on the Polish Hydrogen Strategy. The following EU regulations are of great importance:

the above-mentioned RED III directive;
the EU Hydrogen Strategy;
the Alternative Fuels Infrastructure Regulation (as regards using hydrogen in transport modes which will not be electrified);
indirectly, the Emission Trading System together with the regulation on the Carbon Border Adjustment Mechanism – which promote solutions not contributing to the production and increase of the carbon footprint.

Changes in the Energy Act after 20 January 2025

The changes in the Energy Act caused by enactment of the Hydrogen Act will strongly affect the development of the hydrogen industry in Poland. Below please find the most significant new regulations:

New legal definitions of renewable hydrogen of non-biological origin

The Hydrogen Act updated the existing legal definitions and introduced new ones adapted to the specifics of hydrogen technology. It introduced definitions concerning infrastructure dedicated to the transport of hydrogen, e.g. hydrogen system, hydrogen system user, hydrogen transmission network, hydrogen distribution network, as well as to the storage of hydrogen, which precisely describe large as well as small infrastructure for hydrogen storage. The legal definitions of renewable and low-emission hydrogen have been refined.

Small hydrogen storage systems – development of decentralised solutions for hydrogen storage

The definition of a small hydrogen storage system will help to develop decentralised solutions which may positively affect hydrogen accessibility in rural and industrial areas. Operators are obligated to keep a storage systems register showing their location, capacity (volume) and the legal interest in the system. This solution is designed to develop small and dispersed storage facilities in order to facilitate local introduction of hydrogen technologies.

Comprehensive contracts for hydrogen sellers

Under the new regulation, hydrogen sellers will be obligated to conclude contracts with operators of transmission and distribution systems. It will be possible to conclude contracts for sale, transmission and storage of hydrogen. Contract templates will be made available to operators. The aim of this practice is to ensure transparency and facilitate collaboration among market participants.

Integration of hydrogen with gas and electricity systems

The Hydrogen Act obligates operators of gas and electricity systems to work together so that these systems may function effectively and reliably. The collaboration between operators favours the co-functioning of various energy systems. This is a big step towards the integration of hydrogen with gas and electric systems.

Operators’ obligations as regards delivery security

In order to secure deliveries, operators are obligated to prepare and publish proper instructions for traffic and operation systems and to manage system limitations.

The Energy Regulatory Office’s power to appoint the hydrogen transmission system operators

The Energy Regulatory Office (ERO) may appoint the operators of hydrogen transmission, distribution and storage systems. Operators are appointed based on the following criteria: independence, no conflict of interests and appropriate technical and organisational resources. Exceptions from complete independence are possible as regards local operators with a limited geographical reach. The infrastructure of the operators must ensure continuity and quality of hydrogen supplies. Sorting out the operators’ market should promote the development of transmission and storage structure.

Independence of the operators of hydrogen transmission and distribution

In accordance with the unbundling principle, the operators of hydrogen transmission and distribution systems should be completely independent from production and trade activities. An exception from this rule has been introduced for local networks which are limited geographically. Moreover, a corporate group may share the infrastructure as long as it avoids cross-subsidisation.

Permits and hydrogen certification – new market rules

After the effective date of the Hydrogen Act, hydrogen storage and trade requires a permit. An exception to this rule applies to small systems and hydrogen traders with annual turnover not exceeding 10 million euro. Renewable and low-emission hydrogen certification will be supervised by the President of the ERO. Certificates help to create a market compliant with EU regulations and allow international trade. On the other hand, obligatory permits or certification may protract the investment process.

Tariffs based on actual costs – market transparency and stability

The amended regulations are designed to allow tariffs based on actual costs which will not only ensure market transparency, but also guarantee investors’ stability and confidence. Under the Hydrogen Act, tariffs for hydrogen transmission, distribution and storage will have to be arranged with the ERO and based on actual costs. Operators are obligated to publish model tariffs and ensure that they are transparent and do not discriminate.

Support for the hydrogen economy

The European Union offers state aid programs for the development of hydrogen technologies, such as IF24 auction, The Clean Hydrogen Partnership.

A very popular programme is B2.1.1. Investments in hydrogen technologies, hydrogen production, storage and transport in the form of non-refundable aid are implemented by Bank Gospodarstwa Krajowego (BGK).

These programmes may boost growth of the hydrogen market in Poland.

Summary

The Hydrogen Act introduces long-awaited changes which have been designed to facilitate the functioning of the hydrogen market in Poland. A stable regulatory framework and increased investors’ confidence should stimulate investments in hydrogen infrastructure and projects. Nevertheless, further amendments may be necessary if the new ones prove insufficient. For instance, as hydrogen projects are difficult to implement and develop, hydrogen market participants may ask for changes in the conditions for obtaining a permit.

If you have any questions about the amendments in the regulations on hydrogen, you are welcome to contact us.