The European Commission (EC) has announced a significant step towards advancing the production of low-carbon hydrogen in Europe by introducing a comprehensive greenhouse gas emission methodology. This methodology, a pivotal component of the Hydrogen and Gas Market Directive, is designed to complement existing frameworks for renewable hydrogen and renewable fuels of non-biological origin (RFNBOs). By providing clear guidelines, the EU aims to enhance investment certainty and expedite the production of clean hydrogen across the continent. Aligned with the Clean Industrial Deal, the methodology underscores the importance of legal certainty and coherence as fundamental drivers for attracting investments and enabling producers to expand their operations. Notably, low-carbon hydrogen is expected to play a critical role in decarbonising sectors that currently face challenges with electrification, such as aviation, shipping, and specific industrial processes. To meet the criteria for low-carbon status, hydrogen and related fuels must achieve a minimum of 70% reduction in greenhouse gas emissions compared to unabated fossil fuels. The introduced methodology offers flexibility by accommodating the diverse energy mixes of EU member states, without stipulating a specific share of renewable energy for hydrogen produced from electricity. Moreover, it permits various production methods, including the utilization of natural gas with carbon capture, utilization, and storage (CCUS), as well as low-carbon electricity sources. Looking ahead, the EC is gearing up for a future public consultation on a draft methodology for power purchase agreements (PPAs) for nuclear energy, scheduled for 2026. This initiative aims to provide clarity on producing low-carbon hydrogen from nuclear sources. The recent adoption of the methodology will undergo scrutiny by the European Parliament and the Council for potential approval, without the option to amend the proposals. The Directive mandates the EC to finalize this methodology by August 5, 2025, following extensive consultations with stakeholders and member states. In a bid to further bolster renewable hydrogen production, the EC has allocated €992 million ($1.1 billion) in funding to support 15 projects in the European Economic Area. These projects are anticipated to generate 2.2 million tonnes of renewable hydrogen over the next decade, contributing significantly to emissions reduction and advancing sustainable energy practices in the region.