Dutch stimulus for H2 demand in refining to start 2026

The Dutch stimulus for renewable hydrogen demand in refineries, described as "crucial" by industry participants, will start from 2026, but some details of how the mechanism will function must still be determined, according to the country's government.

From January 2026, fuel suppliers will be able to substitute renewable hydrogen into their processes for making transport fuels, and count this towards their obligations to use hydrogen "in the land, inland shipping and aviation sectors", a spokesperson for the ministry of infrastructure told Argus.

"This is done through the trading of refining units to fuel suppliers," they said. Fuel companies which invest in hydrogen production could generate a surplus of units which they could sell. But the government plans to apply "a correction factor yet to be determined" to the refinery units, to prevent them becoming more valuable than the emission reduction units for directly using hydrogen or e-fuels in the transport sector, they added.

The EU has mandated transport fuel producers to supply a certain percentage of renewable hydrogen or e-fuels as part of the fuel mix, through its renewable energy directive (RED III) legislation. But the proposed mechanism, known as the "refinery route" in the Netherlands, offers a chance to comply with this in a way that still boosts demand but is logistically easier than supplying hydrogen directly to customers, at least while hydrogen infrastructure is still limited.

The mechanism is to be written into legislation via a parliamentary process starting from October, according to the government.

It would be a crucial measure to boost demand for hydrogen, Shell said last month. Growing demand for hydrogen should be the key focus for the sector this year, Paris-based watchdog IEA and hydrogen industry figures have said.

Implementing the "refinery unit" credit system should make investing in electrolysis plants more viable and should help level the playing field with hydrogen producers in Germany and Belgium whose governments plan to use the same mechanism. But the Netherlands still needs to go further by remedying high grid fees to restore the momentum to its renewable hydrogen sector, the Port of Rotterdam said last month.

By Aidan Lea