Gas Package Analysis: The Good, the Bad and the Ugly of the revised Directive and Regulation

As part of the European Green Deal, the European Commission published a legislative proposal, to substantially revise the 2009 EU Gas legislations, including a directive and a regulation. The gas package was the main legislative file of the Fit For 55 package dealing with fossil gas and would have been the golden opportunity to build a fossil free energy system, a fundamental building block to decarbonizing the EU. Our analysis of the gas package assesses the main outcomes, highlighting the following elements:

The outcome fails to include a clear framework and trajectory for fossil gas phase-out across all sectors of the economy including the power sector, industry and buildings. To achieve climate neutrality by 2040 fossil gas must be phased out by 2035.
The gas package operates with a one-to-one replacement logic i.e. substituting gas with hydrogen, copy-pasting the current gas infrastructure system onto future hydrogen networks, without taking into account the specificity and scarcity of hydrogen and the need to prioritise its use in specific sectors. Several rules and exemptions are reflecting this logic: split between hydrogen distribution and transmission levels, unclear separation of powers between gas and hydrogen entities due to weak unbundling rules, weak definition of low-carbon gases, financial incentives for an unreflected buildout of future hydrogen networks, etc.
However progress has been made in planning for the decommissioning of the gas infrastructure as, from entry into force, Distribution System Operators (DSOs) need to develop Network Decommissioning Plans which will have to be revised by National Regulators. Also, measures need to be taken to protect vulnerable consumers when disconnecting end-users from the gas grids.

Find and read the “Gas Package Analysis: The Good, the Bad and the Ugly of the revised Directive and Regulation “.