Germany sets mandates for the use of green hydrogen in transport starting from next year — with penalties for non-compliance
Source：hydrogeninsight
The German cabinet has approved a draft amendment to its existing transport greenhouse gas reduction quota (THQ) to drive the uptake of green hydrogen and its derivatives by 2030, as part of its transposition of the EU’s updated Renewable Energy Directive (RED III).
This includes minimum shares of renewable fuels of non-biological origin (RFNBOs) — ie, green hydrogen or derivatives such as green ammonia, methanol and e-fuels — that meet the EU’s strict definitions, in all transport fuel supplied to the market, starting from 0.1% from 2026.
The green hydrogen quota for fuel suppliers increases to 0.5% from 2028 and then 1.2% in 2030 — slightly higher than the EU mandate of 1% RFNBOs in transport fuels by that year, but lower than the 1.5% quota that had originally been drafted by the cabinet in the summer.
After that, the quota steadily rises to 1.5% from 2032, 2.5% from 2034, 4% from 2036, 5% from 2037, 6% from 2028, 7% from 2039, and finally 8% from 2040.
The amendment also approves the so-called “refinery route”, where oil companies can claim the use of green hydrogen instead of grey H2 during refining to meet their quotas.
If the quota is not met, fuel suppliers will be charged €120 ($140.43) per gigajoule of energy away from compliance. This is equivalent to around €14 per kilogram of H2— meaning that any green hydrogen supply under this price will still be a better deal for companies than facing the penalty.
The greenhouse gas emissions reduction quota for transport is now set to gradually increase from 10.6% in 2025 to 59% in 2040.
The amendment also includes fines based on the EU’s RefuelEU Aviation regulation, which requires 1.2% of aviation fuels to be made using green hydrogen by 2030.
RefuelEU Aviation required member states to set penalties worth twice the difference in cost between synthetic and conventional fuels, which Germany has set to €17,000 per tonne away from compliance.
“This amendment to the law makes refuelling more climate-friendly step by step,” said environment minister Carsten Schneider.
“But it will also create innovation and new value chains: For the first time, there is an obligation for oil companies to use green hydrogen from wind and solar power. This creates secure demand that will drive the expansion of the new hydrogen infrastructure.”
However, the draft bill does not include separate RFNBO quotas for aviation and maritime beyond existing EU rules.
While the former is already regulated by RefuelEU Aviation with a strict 1.2% synthetic fuel mandate by 2030, the EU-level FuelEU Maritime package only includes a binding mandate for RFNBO use after 2031, which could make green hydrogen uptake by German vessels more difficult.
The amendment also incrementally lowers the current multiplier on energy quantity claimed by electric vehicles for credits, which can be traded for oil companies to meet their THQ emissions reduction targets, down to a factor of 1 from 2035.
Meanwhile, green hydrogen and its derivatives will still have a multiplier of three times the energy content when accounting for emissions reduction up until 2037.
German environmental non-profit DUH has strongly criticised the measures, with its federal managing director Jürgen Resch describing the push for green hydrogen in road transport as “pure waste and energy policy madness”, while strongly condemning the allowance for low-carbon electrolytic H2 and the refinery route as a backdoor for fossil fuels.
“Reducing the incentives for e-mobility is exactly the wrong way to go and squanders the potential of the GHG quota as a budget-neutral funding instrument for e-mobility,” he said, calling on federal parliament to reject the cabinet’s draft legislation.
Meanwhile, industry group eFuel Alliance argued that the draft amendment will not be enough to get Germany to its target of 10GW installed electrolyser capacity by 2030, noting that the quotas have been lowered from a previous draft amendment.
“To achieve climate neutrality by 2045, more ambitious RFNBO quotas are needed,” said Ralf Diemer, CEO of the eFuel Alliance, calling for a target of at least 5% by 2030.