The dynamics of state-market relations in the EU’s energy transition: A case study on European hydrogen policy

Recent developments, such as the escalating climate crisis, the energy crisis triggered by Russia’s invasion of Ukraine, and economic turbulence, have led to an increased political commitment within the European Union (EU) to decarbonise its economy. The EU’s current energy policy, which is embedded in its energy transition project involving the integration of power generation, industry, heat supply, and transport sectors, and the associated interlinking of policy areas, is expected to have a significant impact on state-market relations and the sector-specific European system of interest mediation. The Commission, known for its openness to market actors in exchange for technical information (Bouwen 2004), is likely to rely heavily on input from relevant market actors for the successful implementation of its energy transition project. However, newly applied energy sources and carriers as well as new technologies have altered the landscape of stakeholders in the energy sector, and it is uncertain who the key players are. The EU’s active and publicly stated ambition to become a global leader in green technologies, together with significant funding opportunities such as Projects of Common Interest (PCIs), can be expected to influence both the composition of the actor set and the dynamics of the relationship between the Commission and stakeholders. For our analysis of the dynamics of state-market relations in the EU's energy transition, we focus on the energy carrier hydrogen. The EU and many EU member states have been particularly active in promoting the market ramp-up of hydrogen as an essential element of the energy transition project. We examine the relationship between the European Commission and stakeholders in the formulation of hydrogen policy and the development of a European hydrogen market. Our analysis is based on a completely new dataset that includes all publicly available European Commission stakeholder consultations on hydrogen, covering different types of consultation instruments and all participants in these consultations. These new and unique data allow us to identify the stakeholders active in the hydrogen sector at EU level and to explore the composition of the stakeholder population, differentiated by type of interest represented (market actors, business associations, NGOs, etc.) and, for market actors, by economic activity (NACE). In addition, we analyse the patterns of relations between the European Commission and market actors in the hydrogen sector based on the consultation instruments used and the topics discussed. This case study provides an in-depth analysis of state-market relations in the EU hydrogen sector, a key element of current EU energy policy. The analysis highlights possible tensions between the diverging interests of stakeholders and market actors (old and new companies, multinationals and start-ups, wind farm project developers and oil companies, etc.) and the necessary cooperation between the state (the European Commission) and the stakeholders for the successful implementation of the European energy transition. References: Bouwen, Pieter 2004: Exchanging Access Goods for Access, European Journal of Political Research 43(3): 337-369.