ORLEN S.A. position in the ENNOH consultation on future hydrogen network codes
The ORLEN Group presented its position in the European Network of Network Operators for Hydrogen (hereinafter: ‘ENNOH’) on future hydrogen network codes. In its position, ORLEN supports the development of the European hydrogen market and transmission infrastructure as a key element of the EU's energy transition and presents the following key proposals:
1. Inter-temporal cost allocation
The costs of hydrogen infrastructure development should not be borne by first movers. ORLEN supports the use of an amortisation account mechanism, similar to the German HCN model, allowing investment costs to be spread over time, ensuring low initial tariffs and full cost recovery in the long term.
2. Technological neutrality
The regulatory framework should remain technologically neutral and allow all low-carbon and zero-carbon hydrogen production pathways. Limiting support to renewable hydrogen only would slow down market development and reduce infrastructure efficiency.
3. Domestic production and competitiveness
Hydrogen should be produced across Europe, while the hydrogen network must enable transport to major industrial demand centres. Continuous dialogue with producers and consumers is essential for effective network planning.
4. Avoiding overregulation during early market development
Overly restrictive regulation, including strict TPA and unbundling requirements, may hinder early investments. At the initial market stage, private and direct pipelines should not be subject to excessive regulatory burdens.
5. Coordination with the electricity system
Electrolysers provide valuable flexibility to the power system and should benefit from priority grid access and preferential network tariffs.
6. Balancing and tariffs
Balancing rules should reflect the variable nature of renewable hydrogen production and flexible consumption patterns. Daily and hourly capacity products are needed to support market development without imposing excessive costs on users.
7. Uniform European standards
Harmonised European hydrogen network and quality standards should be implemented from the outset to avoid barriers to cross-border trade.
8. Role of distribution networks
Distribution networks and DSOs are essential for industrial decarbonisation, particularly within hydrogen valleys. Power-to-Gas and hydrogen blending enhance sector integration, reduce renewable curtailment, and lower overall system costs. Their role must be fully integrated into hydrogen infrastructure planning.
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