Policy Separate, Law Separate... Hydrogen Investment Companies Embarrassed

Revised Bill Ultimately Fails to Pass National Assembly... Companies Hit Sudden Brake on Business Plans

[Asia Economy Reporter Changhwan Lee, Sejong=Reporter Haeyoung Kwon] The passage of the 'Hydrogen Act Amendment' to revitalize the hydrogen economy in the National Assembly has ultimately failed. The ruling and opposition parties could not narrow their differences over the scope of clean energy recognition during the December extraordinary session. With the failure to even pass the relevant standing committee, not only is the Moon Jae-in administration's hydrogen economy roadmap aiming to achieve the world's number one market share in hydrogen vehicles by 2030 disrupted, but red lights have also been lit for the future business plans of companies that invested trusting the government's hydrogen economy drive policy.

According to the government and the National Assembly on the 11th, the 'Act on the Promotion of Hydrogen Economy and Hydrogen Safety Management (Hydrogen Act) Amendment' did not pass the National Assembly's Industry, Trade, Energy, and Patent Subcommittee by the last day of the December extraordinary session.

A Democratic Party official said, "At the end of last year, the ruling party put a brake on the broad interpretation of clean hydrogen, but this time the opposition raised issues that the plan to produce hydrogen using nuclear power was not included," adding, "Even if the amendment passes after rescheduling the subcommittee in consultation with the opposition, it is uncertain when the plenary session will be held again, making the bill's passage uncertain."

Initially, both ruling and opposition parties were positive about passing the Hydrogen Act amendment. It was reported that members of the Industry, Trade, Energy, Small and Medium Venture Business Committee, the relevant standing committee, from both parties had agreed, raising expectations that it could pass the subcommittee hurdle. However, concerns that production cost reduction would be difficult and hydrogen economy revitalization would be far off if the amendment did not include the use of nuclear power for hydrogen production became a stumbling block.

Lee Juhwan, a member of the People Power Party, pointed out, "It would be ideal to develop and supply clean hydrogen cheaply and efficiently, and to go in that direction, nuclear power with low generation costs must be used to reduce blue hydrogen and limit the use of gray hydrogen," adding, "However, from the basic plan to the contents of this bill, the overall tone fundamentally excludes producing clean hydrogen using nuclear power."

With the failure of the Hydrogen Act amendment, the government's plan to dominate the global eco-friendly energy market through the hydrogen economy is also expected to face setbacks. The government had previously announced a vision to achieve the world's number one market share in hydrogen vehicles and fuel cell sectors by 2030 through the hydrogen economy roadmap.

The renewable energy supply system is also expected to encounter difficulties. The National Assembly Secretariat explained the background of the bill proposal in a related law review report, stating, "With the activation of the hydrogen economy, the proportion of new energy represented by hydrogen among renewable energy is increasing," and "the need to reform the Renewable Portfolio Standard (RPS) system is also growing."

Choi Yongho, a partner at Deloitte Consulting, said, "Many domestic companies are making large-scale investments to foster the hydrogen industry, but the institutional support is weak," adding, "If the amendment to the Hydrogen Act is further delayed in the National Assembly and the implementation of the system becomes uncertain, companies' investments in the hydrogen economy will inevitably stop, and the strategy to lead the hydrogen economy will face difficulties."

This content was produced with the assistance of AI translation services.