Hydrogen law, regulations & strategy in Romania

In 2018, Romania signed the Hydrogen Initiative, committing to continuing research and innovation into how it will use hydrogen as an energy source for the future. Hydrogen and its associated technologies are being explored for use in the electricity storage sector, the transport sector and in industry.

According to the Integrated National Plan in the field of Energy and Climate Change 2021-2030 (“PNIESC”), submitted to the European Commission in April 2020, Romanian authorities are considering the implementation of a number of pilot and demonstration projects to promote the use of hydrogen in the production of electricity and in the industrial sectors.

In order to promote decarbonisation and the adoption of these new technologies, there will need to be a consolidation of the legal framework, intensifying dedication to research and innovation (in both state-owned and private companies), increasing and diversifying funding sources and developing educational resources, as well as supporting projects that promote the increased use of hydrogen.

Romania is also developing a hydrogen strategy, which is envisaged by the recently approved National Recovery and Resilience Plan. The strategy focuses on the development of new distribution networks capable of supporting a gas blend comprising of initially 10% gas and hydrogen. The National Recovery and Resilience Plan includes provisions regarding:

1. the development of renewable gas distribution infrastructure (using natural gas in combination with green hydrogen as a transitional measure);
2. green hydrogen production capacity; and/ or
3. an electricity storage, hydrogen-ready distribution network. This is to be completed and function in the Oltenia region.

In February 2021, the Romanian Official Gazette published Decision 11/2021 of the Chamber of Deputies on the adoption of the opinion on the Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions - A strategy for hydrogen: for a climate neutral Europe COM (2020) 301. The Decision includes 18 points and sets guidelines for a future national strategy on hydrogen, including the development of a legal framework to support the expansion of the hydrogen market, as well as the revision of existing renewable energy legislation to integrate new developments into the hydrogen market.

Energy & Industry

At present, hydrogen is used mainly in the chemical industry, specifically in refineries and for ammonia production. In Romania, there are currently 13 industrial producers of hydrogen (all from fossil fuels), and the hydrogen market comprises of two main types of players: captive producers, which produce hydrogen for their direct customers or their own use; and by-product hydrogen resulting from chemical processes, the chlor-alkali industry.

In 2020, Societatea Națională de Gaze Naturale Romgaz SA Mediaș (“Romgaz”), the largest natural gas producer in Romania, and GSP Power, signed a memorandum to build an electricity plant that will integrate hydrogen into the production of electricity through a 200MW natural gas power plant in Turnu Severin – Halanga. Since then, the rights over land have been secured and currently the feasibility study is under development. The project has been included in the National Plan for Recovery and Resilience. This pilot project was approved by the European Commission as a cleaner gas-based electricity generation concept.

In June 2020, Romgaz and Liberty Galați, the largest integrated steel plant in the country, signed a memorandum for the construction of a gas plant alongside wind and solar PV capacities. The aim of the one point two billion euros (€1.2 billion) project is to develop greenfield investment projects, specifically the development of natural gas-fired electricity generation and hydrogen, to be used by the steel plant. The investment should make the Galati steel plant carbon-neutral by 2030.

Several municipalities are testing hydrogen-fuelled buses to be used for public transportation and have announced their intention to purchase these vehicles. These municipalities include: Oradea, Bucharest and Cluj.

The Romanian authorities have also initiated discussions with Alstom Europa for the introduction of hydrogen-fuelled trains to the Romanian rail network. The Minister of Transport stated in March 2021 that Romania wants to test the trains with hydrogen, being a new and promising technology.

In March 2021, Hidroelectrica approved the memorandum of understanding with Verbund AG for the joint development of the project ’Green Hydrogen @ Blue Danube’ aimed at the production, transport, and sale of green hydrogen.

Hidroelectrica wants to develop in partnership with Verbund green hydrogen by electrolysis of water on a large scale in Romania, using a mix of green energy (off grid wind and on-grid hydro). The resulting hydrogen would be incorporated into a mineral oil and transported on the Danube to countries in the Transregational Danube Interreg program, such as Austria, Bulgaria, the Czech Republic, Germany, Hungary, Slovakia, Montenegro and Serbia.

Research and education

Several public universities and research institutes in Romania are involved in hydrogen and fuel cell research and development. A number of projects are conducting intensive investigations on various issues related to hydrogen energy, particularly in relation to hydrogen storage. Public funding for the research and development of hydrogen is available through the Executive Unit for the Financing of Higher Education, Research, Development and Innovation (“UEFISCDI”) subordinated to the Ministry of Education and Research. From public estimations, Romanian research authorities have spent more than twenty million euros (€20 million) for hydrogen and fuel cell related research since 2000.

The National Hydrogen and Fuel Cell Centre (“ICSI”) develops and implements projects on new technologies (including hydrogen projects). The ICSI was a partner to the HyUnder project and has collaborated with the Joint Technology Initiative on Hydrogen and Fuel Cells Research Group and N.ERGY Group.

In 2012, the Romanian Association for Hydrogen Energy (“AEHR”) was founded. The AEHR aims to support actions related to the hydrogen economy and fuel cells, as well as the infrastructure and renewable energy associated with them. This will be achieved through technology transfer, promoting Romanian contributions, close cooperation with international and national associations, supporting the implementation of educational policies and research, and the promotion of education.

The “Choose Renewable Hydrogen” initiative currently includes companies and associations which are also active in Romania, such as EDP, Enel, Iberdrola, MHI, and Vestas. The initiative is expected to develop renewable hydrogen projects under the scope of the European Green Deal.

A hydrogen energy production capacity could be built on the Oltchim Râmnicu Vâlcea platform, following an investment of between five hundred million euros (€500 million) and one billion euros (€1 billion). The hydrogen plant would be financed from European funds, through the European Green Deal, and the Energy Efficiency Fund

Financial support and incentives

The use of pricing tools to provide incentives for low-carbon transport will be useful in helping deploy hydrogen in the transport sector in Romania. This deployment can be achieved by encouraging the purchase of “green” road vehicles, the use of low-carbon fuels, and reducing the use of cars generally. Specific tools already implemented to achieve these objectives are represented in the application of tax reductions for green vehicles (e.g. hydrogen, methane, and electric vehicles).

Hydrogen based projects may also be eligible for the Contract for Difference mechanism. This is currently being developed by the Ministry of Energy (“ME”) as a viable option for implementing a support scheme for the development of the new low-carbon generation sector in Romania.

The InvestEU programme also provides support in developing infrastructure for alternative fuels: electricity, hydrogen, and liquefied or compressed natural gas mixed with bio-methane (> 50%) and other low and zero emissions technologies.

Several companies that are active in wind energy production have proposed a number of storage projects to be financed by European funds, through the 10d mechanism - Modernization Fund. One of the projects, with a value of fifty million euros (€50 million), “uses PEM electrolysers (alkaline electrolysers with proton exchange membranes - ed.) in order to balance the production of wind energy and to produce hydrogen from excess (or cheap) electricity, which will be introduced into the natural gas network or used in industrial applications for the decarbonisation of industrial processes (steel industry, ammonia, petrochemical industry”.

Legal framework

Romania has not yet developed hydrogen specific legislation. This will be instrumental for the further deployment of hydrogen. 

It is also important that the country removes any barriers that may affect hydrogen production at fuel supply level; this is because hydrogen production is classified as an industrial production activity, regardless of its origin of production.

Policy and government programmes

According to PNIESC, in order to achieve energy security, Romania needs to “diversify its resources, including the development of new capacities of renewable energy and integration with other markets in the region, as well promoting the use of hydrogen”.

The Romanian Government has recently adopted a Memorandum initiated by the Ministry of European Funds and supported by the Ministry of Education and Research. The Memorandum proposes funding in the next programming period (2021-2027) for Romania’s first hub dedicated to hydrogen, for research and development in respect to the use of hydrogen in transportation, district heating and nuclear energy generation, as the “fuel of the future”.

Primary legislation

An amendment was made to the Energy Law on 24 July 2020 in order to include hydrogen production provisions (“Law 155”).

In accordance with Law 155, the general regulatory framework on hydrogen will be established by the energy regulator, ANRE. ANRE will elaborate on the technical and commercial regulations regarding the operation of a hydrogen terminal and the methodology of related tariffs within six months from receiving an application to authorise the construction of the terminal. Tariffs for services provided by the hydrogen terminal operator, regarding the operation of the terminal (e.g. hydrogen storage facilities), are established by the economic operator concerned. These will be approved by ANRE and published on the operator's own web page.

Law 214/2020 provides a comprehensive programme for the development of smart grids at national level. However, no specific reference to hydrogen infrastructure is included.

Generation

Law 155 introduced the requirement for a license to be held for the commercial generation of hydrogen. Secondary legislation is soon expected which will provide further regulatory provisions in respect of licensing and the operation of hydrogen production.

Connection and distribution

According to Law 155, ANRE will need to establish the conditions and standards for the injection of hydrogen into existing natural gas networks. This will facilitate hydrogen blending into the gas grid and will need to be in line with the proposals awaited in the national hydrogen strategy.

Transport, import and export of hydrogen

In March 2017, the National Policy Framework for Market Development Regarding Fuel Alternatives in the Transport Sector and for the Installation of Relevant Infrastructure in Romania was established. The national legislation and policy framework do not include any specific number of hydrogen filling stations that are to be developed.

In Romania, no specific legal framework has been developed regarding the design, authorisation, construction, and operation of hydrogen filling stations.

The policy on the installation of the infrastructure for the alternative fuels sets out the minimum requirements for the creation of alternative fuel infrastructure, including recharging points for electric vehicles and refuelling points for compressed or liquefied natural gas and hydrogen. It also outlines common techniques for recharging and refuelling points, as well as requirements for user information.

Separately, the law 37/2018 on the promotion of the ecological transportation provides that local public authorities, autonomous utilities, and private companies which supply transport services (e.g. taxi companies) are obliged to ensure that at least 30% of their total future fleet are “green” transport solutions.  These may include electric, hybrid, hybrid plug-in, or hydrogen (“FCV”) vehicles, motors powered by compressed natural gas, liquefied natural gas propulsion engines, and biogas propulsion engines.

Law 34/2017 on the installation of infrastructure for alternative fuels lays down minimum requirements for the creation of an alternative fuel infrastructure, including recharging points for electric vehicles and refuelling points for compressed natural gas, liquefied natural gas and hydrogen, to be implemented through national policy frameworks. It also proposes common technical specifications for such recharging and refuelling points, as well as user information requirements.

Secondary legislation and other legal documents

The draft of Romania’s National Energy and Climate Plan includes various references to hydrogen. There have also been a number of initiatives set out by various stakeholders advocating for a transition to a hydrogen economy from a carbon-dependent one.  

At the end of 2020, ANRE published in the Official Gazette several orders outlining a legal framework for hydrogen projects: Order 200/2020 on the approval of the Framework Conditions for validity associated with the establishment authorisation for new hydrogen production installations; Order 201/2020 on the approval of the Framework Conditions for validity associated with the license for commercial operation of new hydrogen production facilities; and the 2020 Validity condition associated with the establishment authorisation for new hydrogen production facilities.

Regulation of hazardous activities

Hydrogen is classified as a dangerous substance for transport and is included in the list of dangerous goods as per the European Agreement concerning the International Carriage of Dangerous Goods by Road (“ADR”), which has been implemented at a national level. From a legal and administrative perspective, the same regulations apply for the storage of hydrogen as the storage of other flammable and dangerous gases.

The Romanian Energy Regulatory Authority is responsible for the drafting of the regulatory framework regarding technologies such as hydrogen.  

A number of regulators also have responsibilities depending on the activity in question:

Over the next few years, it is anticipated that the government will promote and foster the decarbonisation of economy, industry, and business by supporting the introduction of new technologies, such as hydrogen and fuel cells, in order to reduce emissions and protect the environment.

There is discussion amongst decision-makers to reshape the existing energy legislation, and as such it is expected that the legislation and rules supporting decarbonisation will be updated and simplified soon. At a national and local level, decision-makers should find appropriate ways to promote new technologies, such as hydrogen, to attract international as well as domestic investment. Increased awareness about the role of hydrogen has been promoted by government officials who also state that it is of paramount importance that Romania adopts a hydrogen national strategy.