DECARBONISINGEND-USESECTORS:GREENHYDROGENCERTIFICATION©IRENA2022Unlessotherwisestated,materialinthispublicationmaybefreelyused,shared,copied,reproduced,printedand/orstored,providedthatappropriateacknowledgementisgiventoIRENAasthesourceandcopyrightholder.Materialinthispublicationthatisattributedtothirdpartiesmaybesubjecttoseparatetermsofuseandrestrictions,andappropriatepermissionsfromthesethirdpartiesmayneedtobesecuredbeforeanyuseofsuchmaterial.ISBN:978-92-9260-426-4Citation:IRENACoalitionforAction(2022),Decarbonisingend-usesectors:Greenhydrogencertification,InternationalRenewableEnergyAgency,AbuDhabi.AbouttheCoalitionTheIRENACoalitionforActionbringstogetherleadingrenewableenergyplayersfromaroundtheworldwiththecommongoalofadvancingtheuptakeofrenewableenergy.TheCoalitionfacilitatesglobaldialoguesbetweenpublicandprivatesectorstodevelopactionstoincreasetheshareofrenewablesintheglobalenergymixandacceleratetheenergytransition.AboutthispaperThistechnicalbriefhasbeendevelopedjointlybymembersoftheCoalition’sWorkingGroupondecarbonisingend-usesectors.ThisbriefbytheCoalitionforActionhighlightsthebenefitsandchallengesofgreenhydrogencertificationtosupportthedevelopmentofgreenhydrogeninordertoreachdecarbonisationby2050.Itprovidesexamplesofgreenhydrogencertificationschemesimplementedandplannedtodate,aswellasincludeskeyrecommendationsforthesuccessfulimplementationofgreenhydrogencertificatesystems.AcknowledgementsContributingauthors:ElviraLópezPrados,AndreaRealRuiz(ACCIONAEnergía),MerveGungor(EKOenergy),AidanCronin,CamillaThisted(SiemensGamesaRenewableEnergy),StephanieWeckend(formerIRENA),andRanyaOualid,AnindyaBhagirath,GiedreViskantaiteundertheguidanceofRabiaFerroukhi(IRENA).Furtheracknowledgements:ValuablereviewandfeedbackwereprovidedbyStephanSinger(ClimateActionNetwork),MagnusHornøGottlieb(Orsted),DeepakKrishnan(WorldResourcesInstitute),EmanueleBianco,HeribBlanco,BarbaraJinks(IRENA).StefanieDurbineditedandMyrtoPetroudesignedthisbrief.DisclaimerThispublicationandthematerialhereinareprovided“asis”.AllreasonableprecautionshavebeentakenbyIRENAandtheIRENACoalitionforActiontoverifythereliabilityofthematerialinthispublication.However,neitherIRENA,theIRENACoalitionforAction,noranyofitsofficials,agents,dataorotherthird-partycontentprovidersprovidesawarrantyofanykind,eitherexpressedorimplied,andtheyacceptnoresponsibilityorliabilityforanyconsequenceofuseofthepublicationormaterialherein.TheinformationcontainedhereindoesnotnecessarilyrepresenttheviewsofallMembersofIRENAorMembersoftheCoalition.Mentionsofspecificcompanies,projectsorproductsdonotimplyanyendorsementorrecommendation.ThedesignationsemployedandthepresentationofmaterialhereindonotimplytheexpressionofanyopiniononthepartofIRENAortheIRENACoalitionforActionconcerningthelegalstatusofanyregion,country,territory,cityorareaorofitsauthorities,orconcerningthedelimitationoffrontiersorboundaries.FIGURES,TABLESANDBOXES.....................................................................................................4ABBREVIATIONS.........................................................................................................................51.INTRODUCTION....................................................................................................................72.CONSIDERATIONSSURROUNDINGGREENHYDROGENCERTIFICATION...............................93.IMPLEMENTEDANDPLANNEDGREENHYDROGENCERTIFICATIONSCHEMES.....................144.KEYRECOMMENDATIONS...................................................................................................18REFERENCES.............................................................................................................................20CONTENTS4FIGURES,TABLESANDBOXESFigure1.Requirementsforgreenhydrogentrackingcertificates...........................................................................15Table1.Benefitsandchallengesofestablishinggreenhydrogencertificatesbasedondifferentcustodychains.................................................................................................................................13Box1.IRENACoalitionforActionDecarbonisingEnd-UseSectorsWorkingGroup...........................................8Box2.Trackingsystems.........................................................................................................................................................9Box3.Ecolabelsforgreenelectricityconsumption......................................................................................................11Box4.GreenhouseGasProtocol.......................................................................................................................................12Box5.Greenhydrogentrackingsystemsproposalsandprojects..........................................................................17GREENHYDROGENCERTIFICATIONBRIEF5CCSCarboncaptureandstorageEUEuropeanUnionGHGGreenhousegasGOGuaranteeofOriginGWGigawattI-RECSInternationalRenewableEnergyCertificateMWhMegawatthourRECsRenewableEnergyCertificatesREDIIRenewableEnergyDirectiveRFNBORenewablefuelofnon-biologicaloriginWBCSDWorldBusinessCouncilforSustainableDevelopmentWRIWorldResourcesInstituteABBREVIATIONSGREENHYDROGENCERTIFICATIONBRIEF7Ascountriesseektobecomeclimateneutral,greenhydrogen(hydrogenproducedfromrenewableenergy)andsyntheticfuelsderivedfromgreenhydrogenwillhaveakeyroletoplayintheenergytransition,particularlyinhard-to-abatesectors.Morespecifically,greenhydrogencanplayamajorroleinreplacingfossilfuelsinnon-energyprocessesandproducts,suchassteel,fertilisersandplasticsproduction.AccordingtoIRENA’s1.5°CScenario,describedintheWorldEnergyTransitionOutlook(IRENA,2021),greenhydrogenanditsderivativeswillaccountfor12%offinalenergyuseby2050,andtogetherwithelectricity,willrepresent63%offinalenergyconsumption.Achievingdecarbonisationgloballywillrequire5000gigawatts(GW)ofhydrogenelectrolysercapacitytobeinstalledby2050,comparedtoonly0.3GWofinstalledcapacityin2020(IRENA,2021).Today,98%ofthehydrogenproducedgloballycomesfromfossilfuels.Themassivedeploymentanduptakeofgreenhydrogen,aswellastheestablishmentofnational,regionalandinternationalgreenhydrogenmarkets,willdependonthewidespreadacceptanceoftrackinginstrumentscertifyingitsorigin.Trackingsystemsarenecessarytotrackattributesacrosstheentirevaluechain,createtransparency,boostdemandandencouragetransferability(IRENACoalitionforAction,2021).Creatingacost-effectivegreenhydrogentrackingsystembasedoninternationallyagreedhydrogenprincipleswill,however,requirejointeffortsbygovernments,industries,civilsocietyorganisationsandscience-basedtechnicalbodies.Amongothers,thisincludesaddressingpotentialtraceabilityandtrackabilityshortcomingsemanatingfromtheseparationofcertificatesandthephysicalflowofrenewableelectricity.Further,whilecertificatescancontributetopromotingtheuseandproductionofgreenhydrogen,unlesstherearesolidframingconditionsandrules,thesemaynotnecessarilyleadtothescaling-upofsupplychainsandincreasedrenewableenergyindustrycapacity.Finally,theemergenceofamarketforgreenhydrogenwillalsodependgreatlyonincreasedinternationalco-operation.Thisbriefwillprovideanoverviewoftechnicalconsiderationsforgreenhydrogentrackingsystems.Chapter1discussesthebenefitsandimportance,aswellasthechallenges,ofcreatingcertificationschemesforgreenhydrogen.Chapter2analysespracticalcasesofgreenhydrogencertificatesimplementedtodateandhighlightsfutureprojectswithgreenhydrogencertificates.Finally,thelastchapterelaboratesonkeyrecommendationsforcreatingtransparentandefficientgreenhydrogencertificatesandstandardsthatarewidelyaccepted.11Thisbrieflooksatthetechnicalconsiderationsforthecertificationofgreenhydrogen,anddoesnotcovertherequiredsustainabilitycriteriaforhydrogenbyupstreamproducersacrosstheglobe.INTRODUCTION018Establishedin2020,theIRENACoalitionforActionDecarbonisingEnd-UseSectorsWorkingGroupexamines–fromtheperspectivesofpolicy,innovation,technology,socio-economicsandinstitutions,amongothers–howend-usesectorscanmoveawayfromfossilfuelsandachievecompletedecarbonisationby2050.TheGroupdevelopedbestpracticesandpolicyrecommendationsforgreenhydrogeninitsfirstwhitepaper(IRENACoalitionforAction,2021).Thisbriefongreenhydrogencertificationcomplementsthepreviouspaperbyundertakingworkongreenhydrogencertification.CoalitionforActionwhitepaperseries–Decarbonisingend-usesectorsBox1IRENACoalitionforActionDecarbonisingEnd-UseSectorsWorkingGroupDECARBONISINGEND-USESECTORS:PRACTICALINSIGHTSONGREENHYDROGENPhoto:DorothyChiron/Shutterstock.comGREENHYDROGENCERTIFICATIONBRIEF9Certificateregistry››Marketparticipants(ownersofproductiondevices,traders,suppliers)canregistertheirinstallations.››Thecertificatesareissuedontheregistry.››Marketparticipantscanperformtransactionsoftrackingcertificates.Trackingcertificates››Trackingcertificatesserveasanidentificationcard/proofofenergygeneration.››Thecertificatescarrytheenergyattributesandmakeidentificationpossible.››Thecertificateshelpavoiddoublecountingbyenablingconsumerstomakeclaimsonacertainvolumeofenergythathasbeengenerated.››Thecertificatesareredeemedfortheconsumptionoftheend-userandremovedfromcirculationintheregistry.Box2TrackingsystemsCONSIDERATIONSSURROUNDINGGREENHYDROGENTRACKINGSYSTEMS02Toincreasetheuptakeofgreenhydrogen,itisnecessarytoensureaneffective,secureandstraightforwardtrackingsystemthatguaranteesitsorigin.2.1End-usesforgreenhydrogenTrackingcertificatesforrenewableenergyhelpconsumersidentifytherenewableattributesoftheenergyboughtandproveitsorigin.Thesecertificatesareissuedonregistrieswheretherenewableenergyinstallationsarelisted,accordingtotherequirementsofthetrackingsystem.Independentlyandcrediblycertifyingtheoriginenablesconsumerstomakeclaimsonacertainvolumeofenergythathasbeengenerated(EKOenergy,2021)(seeBox2).Trackingcertificatesofrenewableelectricityproductionarecurrentlyissuedpermegawatthour(MWh).Theredemptionofonecertificatefromthedatabaseonbehalfofaconsumermeansthatnooneelsecanclaimusingrenewableelectricitybasedonthatsame1MWhofgeneration,therebyavoidingtheriskofdoublecounting.Inadditiontocertificationsystemsforrenewableelectricity,itisalsopossibletodrawonexperienceintrackingcertificatesforotherenergyproductsthatcanprovidelessonsforgreenhydrogen.102.2GreenelectricitytrackingandlessonslearntAgrowingnumberofcountrieshavedevelopedtrackingsystemsforgreenelectricity,mainlybasedon“bookandclaim”systems.ExamplesfortrackinggreenelectricityincludeGuaranteesofOrigin(GOs;Europe),RenewableEnergyCertificates(RECs;NorthAmerica),andInternationalRenewableEnergyCertificates(I-RECs;managedbyanon-profitorganisation),whichenableproducerstoregisterkeyinformationontheelectricityproduced(i.e.origin,capacity,etc.).End-userscanclaimcertificatestoproveconsumptionofgreenelectricitybasedontheinformationregistered,andthesecertificatescanbeusedasproofofrenewableelectricitypurchase.Giventheirfunctioninthemarket,manylessonscanbedrawnfromtheirusethatcanbeappliedtogreenhydrogen(VanStein-Callenfelsetal.,2020):•Trackingsystemsmustbereliableandsecure.•Verificationofalldataonthesystemsmustbeperformedbyanindependentthirdparty.•Thepurposeofthetrackingcertificatemustbecleartothemarketparticipants,includingwhatthespecificeffectsoncarbonemissionsfrombuyingacertificateare,sothatconsumersarealsobetterinformedabouttheircarbonemissionsneutralitywhenpurchasingthetrackingcertificate.•Theidentificationandmitigationofalltheoperationalrisksemergingfromtheprocessofissuance,transferandcancellationofcertificatesshouldbecarriedoutthroughappropriatesystems,controlsandprocedures.•Objectiveandpublicdisclosurestandardsshouldbeappliedtoallparticipantsinthesystemtocreatefairandopenaccesstoallmarketentrants.•Suitableinternationalcommunicationstrategies,processesandcriteriashouldbecreatedandusedtoensuretransferstodifferentcountriesareeffectiveandsecure.2.3CustodymodelsTrackingsystemscanbebasedondifferentchainofcustodymodels,suchasbook-and-claimormass-balancing.Bookandclaimmodel:The“bookandclaim”system,morecommonlyusedforrenewableelectricity,allowsenergyprovidersto“book”therenewableelectricitytheyhaveproducedintheirsystemsandenergycustomersto“claim”theenergytheyhaveconsumedasrenewable.Provingaphysicallinkforenergyfromthepointofproductiontothepointofconsumptionisnotrequiredinthebookandclaimmodel,meaningthattheclaimonconsumingrenewableenergyisseparatefromthephysicalflow.Inthecaseofgreenhydrogen,usingthesecertificateswillrequiretemporalandgeographicalcorrelationbetweenrenewableenergygenerationandhydrogenproductiontoensuretherenewablenatureoftheirconsumptionofelectricity.Massbalancing:Massbalancing,morecommonlyusedforbiofuels,ontheotherhand,requiresaphysicallinkbetweentheproductionandconsumptionofgreenenergy,andconsignmentsmustbeincontact(i.e.inacontainer,processingorlogisticalfacility,site,etc.)toprovephysicaltraceability.Therearedifferentpossiblegradationswithvaryinglevelsofstrictness.Asanexample,intheEuropeanRenewableGasRegistry,massbalancingrequirementsdonotrequiretrackingthephysicalmovementofbiomethanewithinthelogisticalfacility,butsimplydocumentingthemassbalancebetweentheinjectionandwithdrawalpoints(ERGaR,n.d.).WhileintheUnionDatabasedefinedintheEuropeanUnion’s(EU’s)RenewableEnergyDirectivefortracingthebiofuelsusedinthetransportsector,massbalancingrequirementsarebasedonactualtransactionsbetweenoperators(EuropeanUnion,2018).GREENHYDROGENCERTIFICATIONBRIEF11Anoteworthypointisthatdefinitionsofmassbalancingdifferdependingoneachcountry.Forinstance,somecountriesrequirespecificmassbalancingrulestobeappliedwithintheirjurisdiction,thusrequiringeconomicoperatorstoadministerdifferentmassbalancingsystems.Trackingsystemscanbecomplementedwithotherinstruments,suchasecolabels.Theseinstrumentsdonotreplacetrackinginstrumentsbutmakeuseofinternationallyrecognisedlabelstoaddextrabenefits(seeBox3).Inanefforttostrengthentransparency,civilsociety,non-profitorganisationsinanincreasingnumberofcountrieshavedevelopedvoluntaryconsumerlabelsforrenewableenergytoensurethatagreenenergyproductdoesfulfildesignatedenvironmentalandsustainabilitycriteriaandguaranteethepropertrackingofenergyaswellasensuredoublecountingisavoided.Someofthesevoluntarycertificatelabelsalsopledgeapartoftherevenuegeneratedtofundingnewrenewableenergyprojects.LocallabelsforrenewableelectricityconsumptionincludeBraMiljövalinSweden,GrünerStrominGermany,NatureMadeinSwitzerlandandSvanemærket/EU-BlomsteninDenmark.Otherecolabels,suchasEKOenergyfromEuropeandtheAmericanGreen-e,aremoreandmorepresentontheinternationalmarket,especiallyinAsiaandinLatinAmerica(IRENA,2018).Ecolabelsarecomplementarytoexistingregulatedschemesandprovideadditionalinformationonattributesthatarenotnecessarilyconsideredbyregulation.Manypartsoftheworldstilllackfunctionaltrackingsystems.Impactfulinitiativestoenablevoluntaryuseofrenewableelectricity,suchasI-RECsorinternationalecolabelsthatimprovetransparencyandadditionalimpact,canfacilitatefurthercommunicationandraiseawareness.Box3EcolabelsforgreenelectricityconsumptionItislikelythatasthegreenhydrogenmarketgrowsandmatures,requirementsappliedtorenewableelectricity–asdevelopedintheScope2GuidanceoftheGreenhouseGasProtocol–willalsobeappliedtogreenhydrogenforthepurposeofconsumerdisclosure.(seeBox4).Photo:ohldoerpi/Shutterstock.comDECARBONISINGEND-USESECTORS:12TheWorldResourcesInstitute(WRI)andtheWorldBusinessCouncilforSustainableDevelopment(WBCSD)havejointly,throughapartnership,createdtheGreenhouseGasProtocol.Thisprotocolestablishesacomprehensiveframeworkbasedonglobalstandardsthatallowsprivateandpublicsectorstotransparentlymeasure,monitorandreportthegreenhousegas(GHG)emissionsoftheiroperations.GHGsarecategorisedintothreedifferentscopes.Scope1referstodirectGHGpollutionbythespecificentityinallitsoperationsnotlimitedtomanufacturing.Scope2referstothestandardisationofhowemissionsaremeasuredforboughtoracquiredelectricity,heat,andcoolingand/orGHGemissionsinthesupplychainforproducts.Scope3referstotheemissionsacompanyisresponsibleforoutsideofitsownwall(fromthegoodsitpurchasestothedisposaloftheproductsitsells)(WRIandWBCSD,2013).TheGreenhouseGasProtocol2guidancetakesinnewaccountingrequirementsthataccountforenergycontracts’emissions,thedifferentcriteriatobefulfilledbycontractualinstruments,aswellasrecommendationsonhowtodiscloseinformationtransparently(WRI,2015).Morespecifically,theScope2Guidancenowrequiresthatelectricityandheatcertificatesmustbeusedinthesameenergymarkettheyhavebeenproducedin,andwithinaspecificandlimitedtimeframe.Asthegreenhydrogenmarketdevelops,thesameminimalrequirementswilllikelybeappliedaswell,althoughthegeographicalboundariesofhydrogenmarketswillbelargerthanelectricitymarketsinmostcases.Box4GreenhouseGasProtocol2.4BenefitsandchallengestothecreationofgreenhydrogencertificationschemesGreenhydrogentrackingsystemsarecrucialinpromotingandfacilitatingtheconsumptionofgreenhydrogen.Bygrantingconsumersfullyreliableinformationonthehydrogensuppliedtothem,suchatrackingsystemcanincentivisecompaniestocommittousinggreenhydrogen,createsocialinterestandpromoteconsumerinformation,andthereforehavethepotentialtoacceleratethecleanenergytransition.Thestandardisationofthesecertificatescanalsoallowandsupportthedevelopmentofgreenhydrogentradingandacceleratetheemergenceandestablishmentofaninternationalmarket.Finally,certificationcanalsobeusedtogiveclearandgranularinvestmentsignalsfortheefficientdeploymentofrenewableenergyaccordingtoconsumers’needs(suchaslocation,logisticscosts,needforinfrastructure,etc.).Thereareanumberofobstaclestothecreationandimplementationofgreenhydrogentrackingsystems.First,itremainschallengingtoenforceclearregulationsinternationally,makingitdifficulttocreatecompliancetothesamestandardsandrules.Intheabsenceofclearinternationalregulations,multipletrackingsystemswilllikelyemergeandbeimplementedacrosstheworld.Furthermore,giventhathydrogenisnotaprimaryenergy,creatingabridgebetweencertificatesforgreenhydrogenandcertificatesforrenewableelectricityisnecessarytoavoiddoublecountingtherenewableattributesofitsprimarysourceofgeneration.However,twomainchallengesexisttocreatingthisbridge:•Communicationissuesbetweendifferenttrackingsystemsmayleadtomisuse.•Transparencyissuesmaycomeupifinformationontheproductionprocessandtransport,particularlyrelatingtolinkswithnon-renewables,isnotclearlytraced,documentedandstated.PRACTICALINSIGHTSONGREENHYDROGEN13BENEFITSANDPOTENTIALCHALLENGESOFAPPROACHESWITHDIFFERENTDEGREESOFDECOUPLINGBENEFITSPOTENTIALCHALLENGESBOOKANDCLAIM•Theadministrativecostsandburdenforeconomicoperatorsarerelativelylow.•Managementofthesystemiseasier,andasmallernumberofactorsinthesupplychainneedtobechecked.Smoothadministrationenablesfasteruptake.•Thesourceofhydrogenandplaceofconsumptionaresufficientasnecessaryinformation,makinglinkagetoothertrackingsystemseasier.•Certificationforallenergycarriersfollowingthesamestandardsmakestheharmonisationoftrackingcertificateseasier,makingenergycarrierconversionconvenient.•Bookandclaimsystemsdonotnecessarilyhaveaphysicallinktoproduction.ThiscancreateconfusionforconsumersregardingtheiractualGHGemissionsreduction.•Thelackofaphysicallinkmaydistortefficientandeffectivesectorcoupling;systemflexibility(storage,DemandSideResponse,etc.)wouldnotbeabletocaptureitsactualvalue.•Incaseoftheexistenceofmultipletrackingsystems,possibledoublecertificationshouldbeavoidedandmeasuresbeputinplacetopreventdoubleselling.MASSBALANCING•Massbalancinginformationcouldbeintegratedintoabookandclaimsystem.•Massbalancingiseasiertounderstandforconsumers.Italsomakesiteasiertoimprovetrustinthemarketasmassbalancingcanbeseenasmoreresistanttofraud.•Allpartiesinvolvedinthesupplychainneedtobechecked,whichaddscomplexityandadministrativeburden.•Detailedanddifferentrulesforspecificenergycarriersmayincreasedifficultyforsectorcouplinganddecreaseliquidityinthecertificatesmarket.Table1:BenefitsandchallengesofestablishinggreenhydrogencertificatesbasedondifferentcustodychainsFinally,thegrowthandthedevelopmentofagreenhydrogenmarketshouldsupporttheenergytransition.Withoutaparallelincreaseinthemediumandlongtermofrenewableelectricitycapacity,thedevelopmentofgreenhydrogenmaynegativelyimpacttheenergytransition.(SeeChapter3,Section1,“additionality”.)Greenhydrogentrackingsystemsbasedondifferentchainofcustodymodelspresentdifferentbenefitsandchallengesintheircreationandimplementation(seeTable1).14IMPLEMENTEDANDPLANNEDGREENHYDROGENTRACKINGSYSTEMS033.1RequirementsfortrackingsystemsClassificationofgreenhydrogenandrequirementsfortrackingsystemsTherearetwomainwaystoclassifyhydrogen.Aqualitativeapproachisacolour-codedclassification.Inthis,greenhydrogenisdefinedashydrogenproducedthroughelectrolysispoweredbyrenewableenergy.However,thisapproachdoesnotprovideinformationregardingGHGcontent.ThesecondclassificationisaquantitativeonebasedonGHGfootprint.HydrogenproducedwithinacertainlimitofGHGemissionscanbecertifiedashavingacertainlabel(e.g.low-carbon).ThisallowsthevariationofGHGemissionsofdifferentproductionmethodstobetakenintoconsideration;however,itdoesnotallowforthedistinctionbetweengreenhydrogenoriginandnon-greenhydrogenoriginproduction.Therearefourrequirementsthatgreenhydrogentrackingsystemsshouldcomplywith:temporalcorrelation,geographicalcorrelation,additionalityandtechnologicalspecificationoftherenewableelectricitygeneration,particularlywhenthereisnodirectphysicallinkacrossthevaluechain(seeFigure1).•Temporalcorrelation:Toensurethattheelectricityusedinelectrolysisisrenewable,greenhydrogentrackingsystemsshouldoperateonanappropriatetimeintervalthatwillbothmeetthedemandandsupporttheestablishmentoffuturepowerpurchaseagreements,aswellasincludeavailableproductionforecasts.•Geographicalcorrelation:Greenhydrogentrackingsystemsshouldrequiresomedegreeofphysicallinktoensurethatelectrolysispoweredwithrenewablesisinvolvedintheprocessofproducinghydrogenthatisclaimedtobegreen.•Additionality:Greenhydrogendevelopmentshouldcontributetothebuild-outorfinancingofnewelectricitycapacity,toavoiditsdevelopmentleadingtoincreasedsharesoffossil-generatedelectricityelsewhereintheelectricitysystem.Therefore,greenhydrogencertificatesshouldhaveanadditionalityrequirementattachedtothem.Itisworthnotingthatgiventhatthegreenhydrogenmarketisstillnascent,atransitionalperiodcouldbeallowedduringwhichtheelectrolyserusedtoproducethehydrogenisenabledtotakeelectricityfromexistingrenewableplants,backedbyrenewableelectricitycertificates(i.e.guaranteesoforigins,etc.).Theintroductionofanyshorttermtransitionalmeasureshallensurethatthecertification’srobustness,integrity,andcredibilityvis-à-visconsumersarenotundermined.•Technologicalspecifications:Itisessentialthatspecificationsprovidefulltransparencyandinformationontheresourceusedtoproduceelectricityandensureitsrenewablenature.PRACTICALINSIGHTSONGREENHYDROGEN15Figure1:RequirementsforgreenhydrogentrackingcertificatesTechnologicalcorrelationWhattypeofelectricityisbeingconsumed?GeographicalcorrelationWhereistheelectricitybeingproduced?TimecorrelationWhenistheelectricitybeingproduced?AdditionalityNetincrementalcapacityaddedtotheenergysystemasaresultofgreenhydrogenuse.Renewableelectricitycertificationisthekeytodefinegreenhydrogen.GreenhydrogentrackingsystemsandGHGemissionsGreenhousegasemissionsingreenhydrogenproductionmaybecausedbytheelectrolyserorduringtheelectrolysisprocess,aswellasduringthedistributionandtransportoftheelectricityused.2Therefore,tocrediblycertifygreenhydrogen,trackingcertificatesshouldinformontheGHGcontentineachproducedkilogrammeofgreenhydrogenthatcanoccuralongthevaluechain,fromproductiontotransport:•Ontheproductionside,thetrackingsystemshouldinformonpotentialGHGemissionsandairpollutionoccurringiftheelectricityusedisfromthegrid.•Onthetransportside,inadditiontotrackingtheemissionsfromthetransportationmode,theemissionsproducedintheeventofconversionshouldalsobeconsidered(ammonia,synfuelssuchasrenewablemethane,reconversion,etc.).2TheInternationalPartnershipandFuelCellsintheEconomyisundertakingworkonestablishinggloballyagreedmethodologyandcalculationonGreenhouseGasemissionsrelatedtotheproductionofhydrogen,includinggreenhydrogen.Inaddition,theGreenHydrogenOrganisationaimstoissueaGreenHydrogenStandardtoexemplifybestpracticeinproducingandtransportgreenhydrogen,withanoverallthresholdofcarbonemissions.DECARBONISINGEND-USESECTORS:163.2CurrentcertificationschemeproposalsforgreenhydrogenSomecountrieshavealreadystarteddevelopingproposalsandprojectsforgreenhydrogencertification.AnadvancedexampleisCertifHy,whichhasbeenworkingonaprojecttodesign,forthefirsttime,agreenhydrogenGOintheEuropeanUnion.TheprojectaimstocreateastandardiseddefinitionofgreenhydrogenacrosstheEuropeanUnion,GOsforgreenhydrogenthatcanbedeployableinallofEurope,aswellasanimplementationroadmap.ItwillalsodefinetheprocessesandproceduresforthewholelifecycleoftheGO,whichwillincludeauditsofhydrogenproductionplants;thecertificationofproductionbatches;andtheissuing,tradingand“usage”ofGOs.OneofCertifHy’smainobjectivesistoensurethatgreenhydrogenGOsarecompatiblewithEUlegislation,includingtherecastRenewableEnergyDirective(REDII)(FCH2JU,2019)(seeBox5).In2021,theCommissionapprovedarecastoftheRenewableEnergyDirective(REDII),whichoutlinesgreenhydrogenanditsderivativesasakeyaspectoftheEuropeanUnion’snetzerostrategyEuropeanCommission,2021).Tofacilitatethegrowthofthismarket,newrulesregardingthecertificationandtraceabilityofthesefuelswillbeintroduced.Renewablefuelofnon-biologicalorigin(RFNBO),includinggreenhydrogen,willbetrackedandcertifiedunderanewmechanism,whichwilllikelybepartofanewlysetup“UnionDatabase”orthroughcertificationschemessuchasCertifHy.TheCommissionalsoestablishedalimitof70%GHGemissionreductionscomparedtothebenchmarkofexistingfossil-basedtransportationfuels.OutsidetheEuropeanUnion,othercountrieshavebeenworkingtowardsdevisingastrategyfortrackingsystemsforgreenhydrogen,suchastheUS,UKandChina(dena/WorldEnergyCouncil–Germany,2022).Photo:Scharfsinn/Shutterstock.comGREENHYDROGENCERTIFICATIONBRIEF17CertifHy:CertifHyisaEuropeanprojectsplitintothreephases.TheseincludePhase1(2014and2016),Phase2(2017and2019)andacurrentthirdphase.CertifHyGOsaimtoprovidetransparencyandinformationattheproductionlevelofgreenhydrogen,aswellastoprovideinformationonelementssuchastimeofproduction,energysourceandGHGemissions(FCH2JU,2019).Todate,twolabelshavebeenimplemented:hydrogenisclassifiedaseither“greenhydrogen”or“low-carbonhydrogen”.Forbothcategories,thereisaGHGemissionlimitof60%reductionfromabenchmarkbasedonhydrogenproducedfromnaturalgaswithoutCarboncaptureandstorage(CCS).“Greenhydrogen”thenreferstohydrogenproducedfromwaterelectrolysispoweredbyrenewableenergysourcessuchaswind,solar,hydroorbiogas,while“low-carbonhydrogen”referstohydrogenproducedbywaterelectrolysispoweredbynon-renewable,low-emissionpowersourcessuchasnuclearenergy,orhydrogenproducedfromfossilfuelswithCCS.CertifHyGOscanbeusedacrosstheEuropeanUnionastheschemedecouplesthephysicalhydrogensupplyfromtheenvironmentalattribute.CertifHy’spilotoperationisdesignedtoensurecompatibilitywithEUlegislation,particularlyREDII,andtoaddressanyissuesarisingfromtheimplementationoftheGOschemeforhydrogen.Privatesectorinitiativesfosteringgreenhydrogentrackingapplications:Theprivatesectorissimilarlydevelopingvariousinitiativestohelpend-userstrackandquantifytheimpactoftheirconsumptionofgreenhydrogen.Forinstance,theSpanishdeveloperACCIONAEnergíahasputforwardtheGreenH2chain®platformbasedonblockchaintechnologytoguaranteetherenewableoriginofgreenhydrogen.Theinitiativeallowsaccesstoareal-timedigitalplatforminwhichthegreenhydrogenvaluechaincanbeverifiedandvisualised,therebyenablingthedecarbonisationofenergyconsumptiontobequantified,recordedandmonitored(ACCIONAEnergía).ThisplatformwillbeimplementedinthePowertoGreenHydrogenproject,designedtocreateagreenhydrogenecosystemontheislandofMallorca,Spain(ACCIONA,2021).Box5Greenhydrogentrackingsystemsproposalsandinitiatives3.3ConsiderationsforasuccessfulgreenhydrogentrackingsystemanditsimplementationTosuccessfullyestablishandimplementtrackingsystemsforgreenhydrogen,anumberofelementsandactionsarerequired.Thesecanincreasetransparencyfortheconsumer,avoidmisuseandlimitfraud,aswellassupportthedevelopmentofatradingmarketforgreenhydrogen.Propercertificationwillrequireimplementingthefollowingactions:•Usingareportingandverificationtoolforrenewableand/oremissionreductiontargets•Ensuringtransparentcustodytransferacrosstheentiresupplychain,aspointsofhydrogenproductionandconsumptionmayvary•Employingawell-developedtoolthatenablesthelimitationoffraudulentactivityinthemarketthatmayoccurduetodifferentpricesandsubsidiesapplyingonlyforcertainproductionpathways•Guaranteeingthatgreenhydrogenbecomesatradablecommodityacrossregionalmarkets•Adherencetorecognisedstandardsatallpointsalongthetrackingsystem.18KEYRECOMMENDATIONS04Toensurethattrackingsystemsmeetgreenhydrogensectordemandandachievetheestablishedgreenhydrogenanddecarbonisationgoals,theCoalitionforActionproposesaseriesofkeyrecommendations.Byprovidingtransparencyandincentivisingtheuseofgreenhydrogen,trackingsystemscanpositivelyimpactgreenhydrogendevelopmentandleadtoamorerapiddeploymentofthegreenhydrogensector.Greenhydrogencertificationcansupporttherapiddeploymentofthesectorandhelpreducegenerationcosts.1.Developaharmoniseddefinitionofgreenhydrogen.Aconsensualdefinitionofgreenhydrogenshouldbedeveloped,basedonatransparentmethodologyinordertoavoidfragmentationofthemarket.2.Certifytherenewableoriginoftheenergyusedtoproducehydrogen.Areliablejustificationoftherenewableoriginofelectricitymustbeensured.Itmustbeasinequanonconditiontograntthegreenhydrogencertificate.Renewableelectricityusedforhydrogenproductionwillbedefinedbythefollowingvectors:a.Technologicalcorrelation:Limitationsshouldbesupportedbytrackingsystemsthatensurethattheelectricitycomesfromrenewablesources.b.Geographicalcorrelation:Physicalconstraintsintransportingtheelectricitymustbeconsideredindefininggeographicalboundariestoensurethattherenewableelectricityisphysicallyusedintheelectrolysisprocess.c.Temporalcorrelation:Timeconstraintscriteriashouldbeconsideredforgreenhydrogencertificatestoensurethattheoriginoftheelectricityusedisrenewable.d.Additionality:Additionalityisnecessarytoensurethatthedevelopmentofthesectorisnotdetrimentaltotheenergytransitionasawhole.Additionalityrequirementsshouldbemandatorytoensurethatthegrowthofthegreenhydrogenmarketleadstothegrowthoftherenewableenergysectorandpositivelyimpactstheenergytransition.Creatingastrongandreliabletrackingsystembasedontheserequirementsisessentialfortransparentlyinformingthepublicandprivatesectorsabouttheoriginofthehydrogen.Nevertheless,adegreeofflexibilityinregardtothegeographical,temporalandadditionalityrequirementsshouldbetakenintoaccountintheshorttermtoensurethatthenascentgreenhydrogenmarketcandevelop.Anyshorttermtransitionalmeasure,however,willneedtoensurethatthesystem’srobustnessandintegrity,aswellasitscredibilitytoitsconsumersisnotcompromised.PRACTICALINSIGHTSONGREENHYDROGEN193.Ensurethatcertificatescontainsufficientinformationforconsumersandpolicymakers.Toensureconsumeruptake,certaininformationmustbereadilyavailableinthecertificates.Consumersareprimarilyconcernedwiththeoriginoftheunitsofhydrogenbeingpurchased–thatis,wheretheycomefromandhowtheywereproduced–aswellasthequantificationoftheGHGemissionsoftheproductionprocess.Certificatescanalsoenablegovernmentstomeasureprogresstowardstargetsandpolicyobjectives.4.Simplifythegreenhydrogentrackingsystemtoavoidadministrativeburdens.Certificatesgenerateamarketthatcanacceleratethedeploymentanduptakeofgreenhydrogen.Byavoidingadministrativeburdensandbarriersthatcouldstopordelayprojectdevelopmentareaverted,thesecertificates’positiveimpactonthegreenhydrogenmarketwillbegreater.5.Implementacost-effectivetrackingsystem.Tocreateamarketforgreenhydrogen,cost-effectivetrackingsystemsforhydrogenbasedoninternationallycohesivegreenhydrogenstandardsandcertificationprinciplesmustbeestablished.Acrediblehydrogentrackingsystemcouldgeneratesomecosts;hence,wherepossible,innovativeapproachesandtheuseofcost-effectivetechnologiesshouldbeleveragedtobringdowncertificationcostsforclients.Thisiscrucialforpromotinggreenhydrogenuptakegiventhatitispresentlynotcostcompetitivewithgreyorbluehydrogen.6.Putinplaceappropriatecontrolsystemstoavoidmisuseorlackoftransparency.Identifyanddevisemitigationstrategiesaswellasappropriatesystems,controlsandprocedurestoavoidoperationalrisksassociatedwiththeissue,transferandcancellationofcertificates.7.Considerinteractionswithexistingtrackingsystems.Keyinteractionsbetweenexistingandnewlyestablishedtrackingsystemswillhappenwhenoneenergycarrierthatqualifiesforacertificateisthenconvertedintoanotherenergycarrierthatalsoqualifiesforacertificateunderadifferentscheme.Thecoexistenceandinteractionofdifferentschemescouldthreatenthecredibilityandaccuracyofallexistingschemes.Tocreateawell-functioninggreenhydrogentrackingcertificatesystem,itiscrucialtoevaluateandidentifytheconditionsunderwhichwantedinteractionscanoccuraswellastodevelopmitigationstrategiestoavoidunwantedinteractionsbetweenthedifferentexistingschemes.8.Avoiddoublecounting.Iftwosystemscoexist,forexampleindifferentcountries,mechanismsmustbeputinplacetoensurethatmultiplecertificatesarenotissuedforthesameunitofgreenhydrogen.9.Usetaxonomyandgreenfinancecriteriatoencouragecompliancewithgreenhydrogencertificationrequirements.Greenhydrogenprojectsarecost-intensive,meaningfinancialsupportandaccesstocapitalareneededforprojectdevelopment.Hence,thedesigncouldconsidergreenfinanceprinciplestoopenupaccesstoglobalfundsthatarereservedsolelyforgreenprojectsthatfulfilgreenhydrogentrackingsystemrequirements.10.Promoteinternationalco-operationtoestablishgloballyacceptedrulesandrequirements.Thegreenhydrogenexportindustryispromisingandwithoutaschemeinplacemightbedelayed,reducingitsvalue.UsinginternationallyrecognisedruleswillmakeiteasierforexportmarketstounderstandhowGHGemissionsforthetradedgreenhydrogenarecalculated,facilitatingtheirplacementinthemarket.Insummary,bothrenewableelectricityandgreenhydrogentrackingsystemsneedtofollowtheprinciplesoftransparency,reliability,simplicityandflexibility,whilebeingbackedbyindustryandmanagedbynon-profitorganisationsorotherofficialentity.20REFERENCESACCIONA(2021),ACCIONAdevelopsfirstplatformtoguaranteerenewableoriginofgreenhydrogen,www.acciona.com/updates/news/acciona-develops-first-platform-guarantee-renewable-origin-green-hydrogen/?_adin=02021864894.dena/WorldEnergyCouncil–Germany(2022),Globalharmonisationofhydrogencertification,GermanEnergyAgency/WorldEnergyCouncil,Berlin,www.weltenergierat.de/wp-content/uploads/2022/01/dena_WEC_Harmonisation-of-Hydrogen-Certification_digital_final.pdf.EKOenergy(2021),Trackingofenergy,www.ekoenergy.org/ecolabel/criteria/tracking/.ERGaR(n.d.),ThecoreprinciplesoftheERGaRREDMBScheme,EuropeanRenewableGasRegistry,www.ergar.org/mass-balance/#:~:text=Mass%20balancing%20within%20a%20single,the%20injection%20and%20withdrawal%20points.EuropeanCommission(2021),ProposalforaDirectiveoftheEuropeanParliamentandoftheCouncilamendingDirective(EU)2018/2001oftheEuropeanParliamentandoftheCouncil,Regulation(EU)2018/1999oftheEuropeanParliamentandoftheCouncilandDirective98/70/ECoftheEuropeanParliamentandoftheCouncilasregardsthepromotionofenergyfromrenewablesources,andrepealingCouncilDirective(EU)2015/652,https://ec.europa.eu/info/sites/default/files/amendment-renewable-energy-directive-2030-climate-target-with-annexes_en.pdf.EuropeanUnion(2018),Directive(EU)2018/2001oftheEuropeanParliamentandoftheCouncilof11December2018onthepromotionoftheuseofenergyfromrenewablesources,OfficialJournaloftheEuropeanUnion,https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32018L2001.FCH2JU(2019),Towardsadualhydrogencertificationsystemforguaranteesoforiginandforthecertificationofrenewablehydrogenintransportandforheating&cooling:FinalreportofPhase2,FuelsCellsandHydrogenJointUndertaking,Publicationsoffice,https://dx.doi.org/10.2843/46282.IRENA(2021),WorldEnergyTransitionOutlook2021:1.5°Cpathway,InternationalRenewableEnergyAgency,AbuDhabi,https://irena.org/publications/2021/Jun/World-Energy-Transitions-Outlook.IRENA(2018),Corporatesourcingofrenewables:Marketandindustrytrends–REmadeIndex2018,InternationalRenewableEnergyAgency,AbuDhabi,https://irena.org/-/media/Files/IRENA/Agency/Publication/2018/May/IRENA_Corporate_sourcing_2018.pdf.IRENACoalitionforAction(2021),Decarbonisingend-usesectors:Practicalinsightsongreenhydrogen,InternationalRenewableEnergyAgency,AbuDhabi,https://coalition.irena.org/-/media/Files/IRENA/Coalition-for-Action/Publication/IRENA_Coalition_Green_Hydrogen_2021.pdf.VanStein-Callenfels,R.etal.(2020),TechnicalsupportforRESpolicydevelopmentandimplementation:Establishingtechnicalrequirements&facilitatingthestandardisationprocessforguaranteesoforiginonthebasisofDir(EU)2018/2001.Task2,DevelopingtechnicalrequirementsfortheextendedcoverageofGO,Part2(Version2):DraftrevisionproposalfortheEN16325standardonguaranteesoforiginrelatedtoenergy,EuropeanCommission,www.aib-net.org/sites/default/files/assets/news-events/AIB%20Project-Consult/FaStGO/AIB-2020-FASTGO-02%20task%202%20part%202%20update%20FASTGO%20proposal_EN%2016325_revision_carrier-specific_20200708_after%20consultation_clean.pdf.WRI(2015),GHGProtocolScope2Guidance:AnamendmenttotheGHGProtocolCorporateStandard,WorldResourcesInstitute,https://ghgprotocol.org/scope_2_guidance.WRIandWBCSD(2013),TechnicalguidanceforcalculatingScope3Emissions(Version1.0),SupplementtotheCorporateValueChain(Scope3)Accounting&ReportingStandard,WorldResourcesInstitute&WorldBusinessCouncilforSustainableDevelopment,https://ghgprotocol.org/scope-3-technical-calculation-guidance.www.irena.orgCopyright©IRENA2022
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