Green hydrogen from wastewater – legal hurdles in production

Hydrogen provides significantly more energy than gasoline or diesel. If it is produced using renewable energies, hydrogen can make a significant contribution to climate protection. Only recently, a major mineral oil company announced that it would start producing green hydrogen on a large scale. However, the production of hydrogen requires large quantities of more or less pure water. Water is scarce, but several billion cubic meters of water run through Germany’s sewage treatment plants every year, which could be put to good use. The use of pre-purified wastewater for the production of green hydrogen could reduce water consumption and promote the circular economy. From a legal perspective, the process is unusual and involves a number of legal hurdles. Our environmental law experts Dr. Sandro Köpper and Dr. Thies Wahnschaffe from the environmental law team led by partner Dr. Simon Meyer have analyzed the legal situation.

How can green hydrogen be produced from wastewater?

Dr. Sandro Köpper: Wastewater is a resource that is produced everywhere in Germany in the domestic, commercial and agricultural sectors. This is regularly fed into the respective public wastewater disposal companies (usually wastewater associations) via pipe systems. These in turn often use large sewage treatment plants run by private operators for the biological and chemical treatment of wastewater in order to fulfill their disposal obligations under wastewater legislation. Once the wastewater has been treated in these large sewage treatment plants, pre-cleaned water with a low pollutant content is produced. This pre-purified water can be used in an electrolysis process to sustainably produce hydrogen from some of the pre-purified water. However, the legal assessment of this method is complex and multi-layered. In this context, it is not only the ownership and disposal regulations under civil law that are important, which will not be discussed in detail here. Rather, various questions also arise regarding the classification of pre-purified water under public law in accordance with the relevant environmental regulations, in particular water and recycling management law.

Is the procedure permissible under water law?

Dr. Thies Wahnschaffe: A key question for the legal classification is whether the pre-purified water produced in the sewage treatment plant can still be classified as “wastewater”. Only then would it continue to be subject to the legal requirements for wastewater. This would have far-reaching consequences for the further use of the water in hydrogen production. According to § 56 S. 1 of the German Federal Water Act (WHG), legal entities under public law are obliged under state law to dispose of any wastewater produced. In this case, further use of the water or wastewater would therefore conflict with a public law disposal obligation.

How can this problem be solved legally?

Dr. Sandro Köpper: In our opinion, the pre-purified water can probably no longer be classified as “wastewater” within the meaning of Section 54 (1) WHG after wastewater treatment in the sewage treatment plant. Thus, hydrogen production does not conflict with the disposal obligation under water law. In our opinion, mechanical and biological purification of wastewater, as is regularly carried out in sewage treatment plants, is “treatment” in accordance with Section 54 (2) sentence 1 WHG, as it reduces the pollutant content and reduces the harmfulness of the wastewater. Wastewater can be disposed of not only through discharge, infiltration, sprinkling or trickling, but also explicitly through treatment. It is also not absolutely necessary that a discharge into surface water takes place between the treatment of the wastewater and the use of the treated wastewater for hydrogen production. This has already been confirmed by case law.

Is it a problem that the wastewater is removed from the natural water cycle?

Dr. Thies Wahnschaffe: Once the production of pre-purified water has been completed, water law does not impose any further requirements on the distribution of this pre-purified water. Industrial use of the pre-purified water is also not prohibited. It is true that this partially removes the pre-purified water from the natural water cycle. However, this is in line with the objective of public water supply, as this includes not only the provision of drinking and process water for the population, but also the provision of water as a means of production for industry and commerce. In addition, there is the positive effect that the use of pre-purified water for hydrogen production contributes to the conservation of resources, as this means that groundwater or long-distance water can be dispensed with in the interests of sustainability. In this respect, Section 50 of the Federal Water Act (WHG), which obliges public water supply companies to use water sparingly and carefully, does not stand in the way.

What happens if, in individual cases, it is not recognized that the wastewater disposal obligation is already fulfilled by the treatment?

Dr. Sandro Köpper: If the competent authority comes to the conclusion in an individual case that the wastewater disposal obligation has not been fulfilled by treating the wastewater in the sewage treatment plant, this does not necessarily prevent further use of the wastewater. There are civil law acquisition options for this. However, it should also be noted that hydrogen production itself may also constitute wastewater treatment requiring a permit. The requirements under Section 60 WHG would then have to be complied with in particular. Under certain circumstances, the manufacturer would need a permit. In addition, wastewater treatment must be carried out in accordance with the current state of the art.

What needs to be considered from a waste law perspective?

Dr. Thies Wahnschaffe: Once wastewater disposal has been completed, waste legislation generally applies. This follows from Section 2 (2) No. 9 of the Closed Substance Cycle Waste Management Act (KrWG). However, the question is whether the pre-purified water can be regarded as waste or a by-product at all. This appears doubtful. The fact that the pre-purified water is used for another purpose, namely the production of hydrogen, speaks against this. According to Section 3 (1) KrWG, waste is only substances or objects that the owner wishes to dispose of. The pre-purified water is also not a by-product of the manufacturing process of another product, but is the product itself. However, the exact classification under waste law would always have to be examined on a case-by-case basis.

What permits are required under immission control legislation for the production of hydrogen?

Dr. Sandro Köpper: For the construction and operation of electrolysers for the production of hydrogen, companies need a permit in accordance with the Federal Immission Control Act (BImSchG). It is pleasing that the recently amended 4th Ordinance on the Implementation of the Federal Immission Control Act (4th BImSchV) provides for a simplification of the approval process for hydrogen production. In future, a simplified approval procedure will apply to electrolysers with a daily production capacity of up to 50 tons of hydrogen. Electrolysers with a nominal electrical output of less than five megawatts are exempt from the licensing requirement. The changes are part of the national hydrogen strategy and the Hydrogen Acceleration Act, which facilitates the planning and approval of hydrogen infrastructure and reduces bureaucratic hurdles. Further adjustments could be made as part of the amendment to the Industrial Emissions Directive (IED) and its implementation.

What do you recommend to companies that want to produce green hydrogen from wastewater?

Dr. Thies Wahnschaffe: To ensure sustainable and legally compliant solutions, companies should actively seek dialogue with relevant partners. They should make clear written agreements, either by adapting existing contracts or through new agreements. It is particularly relevant that the pre-purified water is classified as a product, as this offers numerous legal advantages. This classification should be thoroughly reviewed and agreed with all relevant stakeholders, especially water and waste authorities and ministries. This helps to avoid uncertainties and identify legal risks at an early stage. Appropriate agreements and official findings enable companies to sell the pre-purified water to other companies. This not only creates new business opportunities, but also contributes to the sustainable use of resources.