Regulatory Mapping of Future Fuels

Australia’s National Hydrogen Strategy (‘Strategy’) notes that for Australia to become a global leader in clean hydrogen by 2030 would require, amongst other things, an environment conducive to investment through better and more consistent regulation.

In popular discourse, a consistent and predictable regulatory environment is often overlooked as a key facilitator (or roadblock if not pursued) in progressing industry development.

The Strategy includes several nationally coordinated government actions around the themes of ‘responsive regulation’, ‘shared principles for nationally consistent regulation’, and ‘a coordinated approach to planning and regulatory approvals for hydrogen projects’.

In order to progress these actions, a fuller understanding of domestic regulatory frameworks and their existing considerations of hydrogen as a fuel source is necessary. Initial reviews were undertaken by two reports commissioned to inform development of the Strategy.

• Hydrogen Industry Legislation (Clayton Utz, 2019) – a preliminary legal review across jurisdictions identified about 730 pieces of legislation and 119 standards potentially relevant to hydrogen industry and supply chain development. Priority areas for further detailed legal review included the subset of these laws and standards identified as directly applicable to hydrogen’s production, transport to market, use as a fuel, use in gas networks, safety, project approvals, environmental protection and economic effects of the industry.
• Hydrogen in the Gas Distribution Networks (GPA Engineering, 2019) – a review of the relevant state safety and technical legislation in Queensland, South Australia, Tasmania, Victoria, and Western Australia highlighted no substantive barriers to addition of up to 10 per cent hydrogen (by volume) into the gas distribution networks; however, as gas distribution networks and downstream users are closely linked; in all states, further work was recommended to review implications to Acts, regulations and standards concerned with downstream appliances and gas installations. A companion report, Hydrogen Impacts on Downstream Installations and Appliances (GPA Engineering, 2019), reviewed the safety and technical impacts on end users of the addition of up to 10 per cent hydrogen (by volume) into natural gas distribution networks.

The Hydrogen Project Team was established in March 2020 to support implementation of the Strategy and is coordinating / leading key legislative reviews:

• Review of the legal framework – includes a review of state, territory and Commonwealth hydrogen regulations relevant to hydrogen safety and industry development, and will deliver recommendations for reform.
• Review supporting hydrogen use in Australian gas networks – includes a review of the National Gas Law (NGL) and other national energy legislation, regulations and rules as applied to hydrogen; economic analysis of hydrogen in gas networks; and options for a framework for setting and allowing updates of upper limits on the volume of hydrogen allowed to be blended in gas networks.

Building on previous reviews, in 2019, the Future Fuels Cooperative Research Centre (CRC) initiated a Regulatory Mapping of Future Fuels study that identifies existing Australian legislation (including Acts, regulations, statutory policy and referenced standards) that may impact the introduction of future fuels such as hydrogen or biogas into existing natural gas infrastructure.

The study reviewed relevant Acts and their associated regulations and standards across all aspects of the supply chain (extraction, manufacturing, storage, transmission, distribution and use) relevant to the introduction of future fuels into existing natural gas infrastructure.

The study summaries key current regulation across three areas – safety and technical regulation, economic regulation, and environment and land use planning regulation. In investigating the impacts of existing legislation, the study authors note that a conservative approach has been undertaken such that industry proponents, policymakers and legislators may be better able to understand and respond to potential regulatory barriers to the introduction of future fuels into the (traditional) natural gas supply chain.

Detailed results are recorded in a spreadsheet which forms an electronic attachment to the study. The database holds details of legislation by state and territory, as well as Commonwealth legislation and applicable standards. The database is designed to be readily updated as these regulations evolve.

To support development of future fuels in Australia, the Future Fuels CRC has made the full report – Regulatory Mapping of Future Fuels – and legislation database publicly available.

The Australian energy industry and regulators especially benefit from this study; it supports early identification of possible amendments to regulations that can accelerate project approval processes.

The principal author of this Features article is Peter Grubnic, HyResource Project Lead: peter.grubnic@futurefuelscrc.com.