Author: Kerstin Reisch

§13k in the EnWG was passed in the Bundestag in autumn 2023. This paragraph has the great potential to translate the economic benefits of sector coupling technologies into concrete investments. We are also committed to this. The core idea of the paragraph is to make otherwise curtailed renewable electricity usable for other sectors such as hydrogen.

With the current implementation proposal from the transmission system operators, only projects that will be built anyway will be able to tap into a small additional source of income. However, from our point of view no new projects are being constructed because of §13k. Therefore, the sector coupling technologies continue to remain far behind their potential. In our view, the proposed implementation contradicts the Bundestag’s intention in its decision last autumn, and we hope for a better implementation.

Here is our detailed positioning on the current debate.

Federal politicians are currently working on revising the 37th Federal Immission Control Act (BlmschGV). This amendment is expected to be passed in March 2024. This project sets several important steps for ramping up the hydrogen supply in Germany. But what exactly is it about?

A central point is the precise definition of green hydrogen. The 37th BlmschV implements the long-awaited EU Delegated Act from RED II national law and thereby describes how to implement the basic principles of “renewable energy”, “temporal correlation”, “geographical correlation” and “additionality” for our customers. Due to the integrated storage function of our ZZE technology, our electrolyser is particularly suitable for meeting these criteria today and in the future.

Another central point is recognising how green hydrogen can be counted towards meeting the transport sector’s greenhouse gas reduction quota. The transport sector must reduce its emissions yearly through a greenhouse gas reduction quota. With the reform of the 37th BlmschV, green hydrogen will be counted three times towards quota fulfilment, giving market development a big boost.The life cycle emissions must also be calculated to use green hydrogen in the transport sector. There is already another EU Delegated Act for this from RED II. These life cycle emissions include, for example, the transport of green hydrogen to the H2 filling station, which for safety reasons can only be done with diesel trucks, or the electricity consumption of the H2 filling station, e.g., in the compressors. We believe there is still a need for federal policymakers to take action. These details can significantly facilitate or hinder the ramp-up of the use of green H2 in mobility. More information can be found here (German only).

Initiate the European transformation for green hydrogen with quotas

On October 18, 2023, the EU decided on the Renewable Energy Directive 3 (RED III), a framework for expanding and using renewable energies in all sectors. In addition to the goals for the expansion of renewable energies and renewable heat, the document also contains, among other things, uniform definitions and calculation methods for different renewable energies and measures to accelerate approval procedures. While the core goal is the rapid market uptake of renewable energies in all sectors, there are also limited interventions in biomass.

RED III also sets essential cornerstones for the ramp-up of renewable hydrogen. This includes, among other things, the basis for EU-wide trade in hydrogen via a proof of origin system. In addition, energy storage is classified as being of “overriding public interest” and can therefore be approved more quickly. RED III also announces that the EU Commission will review the agreed definition of green hydrogen in 2028 to enable a rapid ramp-up of green hydrogen.

Binding targets for individual sectors, which are intended to provide orientation and planning security for all actors along the value chain, are crucial for the ramp-up:

• The industry should cover its hydrogen needs by 42% green hydrogen and its derivative products by 2030 at the latest and 60% by 2035. As a result, green hydrogen will replace grey hydrogen based on fossil fuels and reduce carbon emissions.
• At least 29% renewable energy should be used in the transport sector by 2030. A sub-quota of at least 1% applies to green hydrogen and its derivative products.
• Ships should use at least 1.2% green hydrogen or derivative products in 2030.
• The use of hydrogen in backup power plants is explicitly welcomed.

RED III creates demand for at least 30 TWh of green hydrogen in Germany in 2030. This will support the implementation of the German National Hydrogen Strategy that targets 95 to 130 TWh hydrogen in 2030 (including blue hydrogen).

It is now up to the German federal government to translate the binding framework of RED III into national laws that enable investment decisions for the required and necessary ramp-up of green hydrogen. One approach is a GHG reduction quota mechanism, which has been used in the transport sector. With a mandatory, ever-increasing quota, users are obliged to reduce CO2 emissions and switch to renewable energies gradually. The users themselves bear the costs without any burden for the taxpayers. Such a mechanism ensures the green hydrogen ramp-up. It also leads to FIDs (final investment decisions i.e., binding investment decisions) being made quickly for H2 projects along the entire value chain – from renewable energies to H2 use.

STOFF2 can benefit from the national implementation of RED III like no other actor. Our “Zinc-Zwischenschritt Electrolyzer” with integrated storage function allows us to use green electricity when available and cheap and simultaneously provide green hydrogen to the gas network or directly to the H2 customer as required.

Sector coupling, and the use of green hydrogen are receiving an important boost – the STOFF2 technology is perfect for this 

On November 10, 2023, the German Bundestag decided to introduce paragraph 13k in the Energiewirtschaftsgesetz (EnWG). “Use instead of curtailment” becomes the requirement when it comes to renewable electricity that cannot be used due to a lack of sufficient grid capacity or low demand for electricity. What does “use instead of curtailment” mean specifically, and what positive effects does this principle have? 

In recent years, the costs of renewable electricity volumes, which are inevitably curtailed by grid operators, have risen massively. In 2022, costs totaling more than 10 billion euros were incurred for renewable energy curtailment and the so-called redispatch, which had to be covered by the federal budget. Redispatch is the name given to switching on coal or gas power plants, particularly in southern and western Germany, when there is a large supply of wind and solar power available which cannot be transported there due to a lack of sufficient grid capacity. The wind farms and PV systems are then switched off, even though there is sufficient demand for electricity, and their operators receive corresponding compensation for their outage. At the same time, electricity from gas and coal-fired power plants must also be compensated. The German Bundestag has now decided on a regulation that will stop the further increase in the costs of unused green electricity and at the same time enable an additional contribution to the ramp-up of the hydrogen economy and climate protection: The new paragraph 13k of the EnWG stipulates that from October 2024 curtailed renewable electricity can be used by highly flexible electricity consumers with a connected load of at least 500 kW through a newly established auction mechanism. Highly flexible and therefore network-friendly systems can absorb this otherwise curtailed energy and use it to convert it for example into green hydrogen. 

STOFF2 welcomes the new regulation decided by the Bundestag. The new paragraph 13k of the EnWG now ushers in a turning point in dealing with renewable electricity quantities that would otherwise be curtailed: instead of leaving them unused in an economically inefficient manner, they will accelerate sector coupling in the future. The use of renewable electricity in the form of green molecules is becoming an equivalent option. The green hydrogen economy will receive an important additional boost. This means that the amounts of electricity that were previously “thrown away” can now be used – for example in the form of green hydrogen from the Zink Zwischenschritt Elektrolyzer (ZZE) from STOFF2. The ZZE technology is technically and economically ideally suited for the use of electricity that would otherwise have to be curtailed: four to six hours of absorption of “curtailed current” enable continuous hydrogen release for up to 20 hours. In this way, a ZZE can generate and provide green hydrogen particularly cost-effectively and in line with demand. The new paragraph 13k enables our customers to use this quality even more intensively.

Our innovative electrolysis technology, the Zinc Zwischenschritt Elektrolyzer (ZZE), can become a decisive building block for the rapid implementation of the political targets for CO2 reduction in all sectors. Together with other technologies, we enable the integration of high shares of fluctuating renewable energies and rapid decarbonisation, especially of all application areas whose direct electrification is complicated, cost-intensive or cannot be implemented quickly enough. At the same time, the right political framework is required so that our customers and partners invest in our systems and thus in the transformation of the energy supply.

As a company, we want to work with our customers to make the greatest possible contribution to the use of renewable energies in all sectors. That is why we consciously engage in regular exchanges with political actors. We are convinced that by transparently communicating our positions we can help shape the political discourse and contribute valuable information to support democratic decision-making processes.

We would like to contribute independently and together with other actors from science, industry and civil society to the process of political decision-making. Our advocacy focuses on three areas of action:

1. rapid expansion of renewable energies in the form of renewable electricity, renewable gases such as hydrogen and green heat. 
2. comprehensive removal of barriers to the expansion of renewable energies, hydrogen and sustainable grid infrastructures.
3. increased and accelerated use of green hydrogen in all sectors that are not yet on a 1.5°C compatible decarbonisation path.

Our position papers and statements can be found here on the website under the filter “Policy”. Furthermore, we document our lobbying in the official register of the German Bundestag. 

If you would like to talk to us, please feel free to speak to Dr. Christian Friebe directly.