100% renewable targets will require power storage to manage flows on the net
Electrolysers utilise these intermittent power flows to produce H2 gas from water
H2 gas can be stored in large quantities underground and transported via existing gas pipelines
H2 vehicles recharge faster and are more durable than battery powered transport
Growing H2 demand in industrial processes will reduce costs and increase supply

MEPs will today vote  on the proposal for revision of the 2003 Energy Taxation Directive (ETD) following a report by Astrid Lulling (EPP, Luxembourg) in Strasbourg last night. The revision marks the introduction of CO 2 in the taxation of energy products and electricity and the end of the special status given to diesel fuel and unleaded petrol.

 

The proposal, presented by the European Commission in 2011, constitutes the response to the EU summit’s 2008 request to align the European Union’s energy and climate change objectives. Under the revision, taxation would be based not only on energy content but also on the CO 2 content of energy products, and would include a minimum level for CO 2. Member states will therefore have to make a clear distinction between the two components: taxation of CO 2 and taxation of the energy source.

The text also provides for abolishing the reductions granted for diesel fuel for professional use as well as the preferential price for unleaded petrol. More generally, it does away with the existing distinction between commercial and private use of energy products to produce heat and electricity. While maintaining a degree of flexibility, including the possibility for member states to levy more than one tax on energy consumption, the proposal nevertheless sets limits on optional reductions and exemptions from taxation in order to ensure a coherent CO 2 price signal outside the Union’s Emission Trading Scheme (ETS), and to abolish the possibility for member states to exempt agricultural activities from taxation. The text gives member states the right to offer a tax reduction for biofuels as from 2023.

In its report, adopted on 8 March, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) makes a number of amendments to the Commission’s text, recommending:

– a tax exemption on waste used as an alternative fuel, and more importantly

– an exemption from CO 2 taxation for direct and indirect consumption in industrial installations subject to the ETS. “A double burden in the form of double taxation and double regulation would lead to distortions of competition and must be ruled out,” argues Lulling.

The report also recommends the application of the principle of technological neutrality in order to give new technologies the opportunity to develop. It calls for maintaining the possibility for member states to apply lower taxation, down to zero, to agricultural activities.

Under the revision, taxation would be based not only on energy content but also on the CO 2 content of energy products, and would include a minimum level for CO 2