Skip to main content

With the recent adoption of a new hydrogen and gas package, the European Commission is drafting a delegated act detailing the conditions and criteria for products to be considered low carbon fuels (LCFs). As a Carbon Capture and Utilisation (CCU) community, CO₂ Value Europe insists that LCFs must have a clear definition to become a complementary pathway to renewable fuel deployment.

While the Renewable Energy Directive defines renewable hydrogen and its derivatives as renewable fuels of non-biological origin (RFNBOs) and specific CCU pathways as recycled carbon fuels (RCFs), the recently adopted Directive on internal market rules for renewable and natural gases and hydrogen leads the way for the adoption of a methodology on how to define low carbon hydrogen and LCFs. Several EU legislations specify different methodologies to assess GHG emissions savings or quotas to contribute to GHG emissions reduction targets via RFNBOs & RCFs (ReFuelEU Aviation, REDIII), and sometimes LCFs (FuelEU Maritime). CO₂ Value Europe recognises the importance of informing value chains and providing clarity and perspective on what is and is not included in LCFs’ definition.

In accordance, LCFs can be interpreted differently by different stakeholders, referring to fuels made from low carbon & non-fossil energy (e.g. nuclear); hydrogen based on fossil fuels with carbon capture and storage; or a part of fuels that are not considered ‘fully renewable’ under the REDII Delegated Acts but still has low levels of carbon emissions.

In this case, CO₂ Value Europe calls on the European Commission to:

🔵 Clarify if the definition of low carbon hydrogen and low carbon fuels differ according to end-use sectors (e.g. ReFuel EU aviation defines low carbon aviation fuels as derived from non-fossil non-renewable sources, aka nuclear).

🔵 Distinguish between RFNBOs and LCFs in EU legislations, e.g. in potential quotas, to ensure that both can contribute to decreasing emissions in hard-to-abate sectors while considering the specificities of their value chains.

🔵 Adapt existing EU rules (for RFNBOs or LCFs) to meet official EU targets (REDIII targets, FuelEU Maritime – GHG emissions reductions, ReFuelEU Aviation – mandatory synthetic fuels targets), by allowing unavoidable process emissions to continue to be valorised in fuels after 2040.

Low carbon fuels can act as a complementary pathway in addition to the deployment of renewable fuels. But LCFs should be clearly and consistently defined at the EU level, legal certainty should be provided to stakeholders on which fuels are eligible or not to reach mandatory synthetic fuels targets, and additional rules should be adopted swiftly to complete the EU regulatory framework for CCU fuels in general, e.g. accounting under ETS.

Read the full statement here.