Financing models and legal regulatory dynamics in the development of green hydrogen markets: A comparative analysis focused on Türkiye and European Union

Abstract

In order for green hydrogen to assume a strategic role in sustainable energy systems, not only technological advancements but also robust financial models and effective regulatory mechanisms are required. This study provides a comparative analysis of the financing strategies and legal regulatory frameworks implemented in the context of the development of green hydrogen markets in Türkiye and the European Union (EU). First, considering the capital-intensive nature of green hydrogen production, financial instruments such as Public-Private Partnerships (PPPs), green bonds, carbon pricing, and investment incentives are analyzed. Then, the legal framework related to the production, transportation, and utilization processes of hydrogen is evaluated, along with the roles of market regulatory institutions and the issue of standardization within the context of energy law. The legal and economic feasibility of Türkiye’s National Hydrogen Strategy Document, which is currently in draft form, is analyzed in comparison with the European Green Deal (EGD), the Important Projects of Common European Interest (IPCEI), and the EU Hydrogen Strategy. In addition, the potential legal and financial obligations that may arise from linking hydrogen to mechanisms such as the Carbon Border Adjustment Mechanism (CBAM) and emissions trading systems are discussed. Within this scope, the study emphasizes the necessity of integrated financial and legal strategies to establish a sustainable investment environment for the development of hydrogen markets, offering guiding recommendations for both public policymakers and private sector investors.

Keywords

• Hydrogen
• Financing
• Legal regulation
• Green transition

References

1. [1] Arif M, Cheung SC, Andrews J. A systematic approach for matching simulated and experimental polarization curves for a PEM fuel cell. International Journal of Hydrogen Energy 2020; 45(3): 2206-23.
2. [2] Walker J, Pekmezovic A, Walker G. Sustainable development goals: Harnessing business to achieve the SDGs through finance, technology and law reform: John Wiley & Sons; 2019.
3. [3] Turguttopbaş N. Sürdürülebilirlik, yeşil finans ve ilk türk yeşil tahvil ihraci. Finansal Araştırmalar ve Çalışmalar Dergisi 2020; 12(22): 267-83.
4. [4] Jones P, Comfort D. Sustainability bonds and green bonds in the retail sector. International Journal of Sales, Retailing Marketing Intelligence & Planning 2020; 9(1): 37-43.
5. [5] Kandır SY, Yakar S. Yeşil tahvil piyasalari: Türkiye’de yeşil tahvil piyasasinin geliştirilebilmesi için öneriler. Çukurova Üniversitesi Sosyal Bilimler Enstitüsü Dergisi 2017; 26(2): 159-75.
6. [6] Ozkan T. Yeşil tahvil piyasaları: Türkiye örneği. Pressacademia Procedia 2019; 10(1): 73-5.
7. [7] Taghizadeh-Hesary F, Li Y, Rasoulinezhad E, Mortha A, Long Y, Lan Y, Zhang Z, Li N, Zhao X, Wang Y. Green finance and the economic feasibility of hydrogen projects. International Journal of Hydrogen Energy 2022; 47(58): 24511-22.
8. [8] Apak S, Atay E, Tuncer G. Renewable hydrogen energy regulations, codes and standards: Challenges faced by an EU candidate country. International Journal of Hydrogen Energy 2012; 37(7): 5481-97.

9. [9] Erdogdu E. The carbon border adjustment mechanism: Opportunities and challenges for non‐EU countries. Wiley Interdisciplinary Reviews: Energy Environment Development and Sustainability 2025; 14(1): e70000.
10. [10] Shee Weng L. The EU's carbon border adjustment mechanism (CBAM): balancing climate action and global trade. The EU's Carbon Border Adjustment Mechanism : Balancing Climate Action Global Trade 2025.
11. [11] Zhang M, Yang X. The regulatory perspectives to china’s emerging hydrogen economy: Characteristics, challenges, and solutions. Sustainability 2022; 14(15): 9700.
12. [12] Lu Q, Farooq MU, Ma X, Iram R. Assessing the combining role of public-private investment as a green finance and renewable energy in carbon neutrality target. Renewable Energy 2022; 196: 1357-65.
13. [13] European Comission: Energy, Climate Change, Environment: European Hydrogen Bank. Available from: https://energy.ec.europa.eu/topics/eus-energy-system/hydrogen/european-hydrogen-bank_en
14. [14] Communication from the commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions. 16.03.2023. Available from: https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52023DC0156
15. [15] Türkiye hidrojen teknolojileri stratejisi ve yol haritası. 19.01.2023. Available from: https://enerji.gov.tr/Media/Dizin/SGB/tr/Kurumsal_Politikalar/HSP/ETKB_Hidrojen_Stratejik_Plan2023.pdf
16. [16] TÜBİTAK 2022-2023 öncelikli ar-ge ve yenilik konuları. Available from: https://tubitak.gov.tr/tr/duyuru/tubitak-2022-2023-oncelikli-ar-ge-ve-yenilik-konulari?utm_
17. [17] 2023 Borsa istanbul entegre faaliyet raporu. 2023. Available from: https://www.borsaistanbul.com/files/2023-entegre-faaliyet-raporu.pdf
18. [18] European investment bank group activity report. European Investment Bank; 2024 2024. Available from: https://www.eib.org/attachments/lucalli/20240269_eib_group_activity_report_2024_en.pdf
19. [19] A european green deal. European Commission 11.12.2019. Available from: https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:52019DC0640
20. [20] Important projects of common european interest (IPCEI): European Commission; 2020. Available from: https://competition-policy.ec.europa.eu/state-aid/ipcei_en
21. [21] Bilgiç G. Türkiye hidrojen enerjisi stratejilerinin ve geliştirilen politikaların araştırılması. Düzce Üniversitesi Teknik Bilimler Dergisi 2024; 2(1): 70-9.
22. [22] Important project of common european interest European Commission. Available from: https://ec.europa.eu/commission/presscorner/detail/en/ip_24_2851
23. [23] Türkiye ulusal hidrojen strateji belgesi. Enerji ve Tabii Kaynaklar Bakanlığı; 2023. Available from: https://enerji.gov.tr/Media/Dizin/SGB/tr/Kurumsal_Politikalar/HSP/ETKB_Hidrojen_Stratejik_Plan2023.pdf
24. [24] The European green bond standard: European Commission. Available from: https://finance.ec.europa.eu/sustainable-finance/tools-and-standards/european-green-bond-standard-supporting-transition_en?prefLang=mt
25. [25] Özel ihtisas komisyonu raporu. T.C. Cumhurbaşkanlığı Strateji ve Bütçe Başkanlığı; 2023. Available from: https://www.sbb.gov.tr/wp-content/uploads/2025/08/Finansal-Hizmetlerin-Gelistirilmesi-Ozel-Ihtisas-Komisyonu-Raporu_01082025.pdf
26. [26] Blyth W, Bunn D, Kettunen J, Wilson T. Policy interactions, risk and price formation in carbon markets. Energy Policy 2009; 37(12): 5192-207.
27. [27] Carbon border adjustment mechanism: European Commission. Available from: https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism_en
28. [28] Turhan E, Gündoğan AC. Price and prejudice: the politics of carbon market establishment in Turkey. Turkish Studies-Social Sciences 2019; 20(4): 512-40.
29. [29] Fleming R. The cambridge handbook of hydrogen and the law: Cambridge University Press; 2024.
30. [30] Dated 7 ekim 2021 and numbered 31621 official gazette. Cumhurbaşkanlığı İdari İşler Başkanlığı; 2021. Available from: https://www.resmigazete.gov.tr/eskiler/2021/10/20211007M1.pdf
31. [31] 7. united nations framework convention on climate change: United Nations. Available from: https://treaties.un.org/pages/ViewDetailsIII.aspx?src=TREATY&mtdsg_no=XXVII-7&chapter=27&Temp=mtdsg3&clang=_en
32. [32] Türkiye Cumhuriyeti güncellenmiş birinci ulusal katkı beyanı Türkiye Cumhuriyeti Hükümeti. Available from: https://www.iklim.gov.tr/db/turkce/haberler/files/Türkiye%20Cumhuriyeti%20Güncellenmiş%20Birinci%20Ulusal%20Katkı%20Beyanı(1).pdf
33. [33] Europe's definition of green hydrogen (RFNBO) adopted into EU law: Client Alert; 2023. Available from: https://www.kslaw.com/news-and-insights/europes-definition-of-green-hydrogen-rfnbo-adopted-into-eu-law
34. [34] Renewable fuels of non-biological origin in the European Union: European Commission. Available from: https://setis.ec.europa.eu/renewable-fuels-non-biological-origin-european-union_en