Renewable Energy Directive III (RED III)

– What You Need to Know of renewable targets and RFNBO implementation

The European Union is accelerating its energy transition to meet climate neutrality by 2050. As part of this shift, the Renewable Energy Directive III (RED III) was adopted in 2023 to reinforce the EU’s renewable energy targets and provide stronger market signals for investment in clean technologies. RED III builds on previous iterations by introducing sector-specific mandates, tightening rules for renewable fuel certification, and placing significant emphasis on Renewable Fuels of Non-Biological Origin (RFNBOs)—fuels produced using renewable electricity, such as green hydrogen and synthetic methane.

For innovative climate tech companies like BioShare, RED III creates both a framework and a market pull for scalable, cost-efficient solutions that convert biogenic and renewable electricity sources into high-quality synthetic fuels. BioShare’s proprietary gasification and fluidized bed technologies are designed to meet the stringent RED III criteria, enabling industrial and energy sector clients to comply with the directive while decarbonizing operations.

Below is a summary of the directive and the performance indicators that will define success for RFNBOs in the coming decades.

Key Highlights of RED III:

• 42.5% Renewable Energy Target by 2030, with a further aspirational target of 45%.
• Transport Sector Mandates:
  • At least 5.5% of all fuels in the transport sector must be advanced biofuels and RFNBOs by 2030.
  • Of this, 1% must be RFNBOs.
• Industry Sector Requirements:
  • From 2030, 42% of the hydrogen used in industry must be renewable, rising to 60% by 2035.

RFNBO Compliance – What Counts?

To qualify as RFNBO under RED III and its delegated acts, fuels must:

• Be produced using renewable electricity (tracked via hourly matching or a temporal correlation scheme).
• Meet the greenhouse gas emissions savings threshold of at least 70%.
• Be generated via electrolysis or from renewable carbon feedstocks, such as CO₂ captured from biogenic or direct air sources.
• Adhere to additionality, temporal, and geographical correlation rules for electricity sourcing (to ensure that hydrogen production contributes to grid decarbonization).

Key Performance Indicators (KPIs) for RFNBOs:

1. Carbon Intensity: Measured in gCO₂eq/MJ, must meet GHG savings thresholds.
2. Renewable Electricity Share: Ratio of renewable power used in production.
3. Hourly Matching Compliance: Especially post-2030, fuels must prove real-time renewable sourcing.
4. Capacity Factor: Efficiency and utilization rate of electrolysis systems.
5. Certification and Traceability: Proof through schemes like CertifHy and EU-recognized Guarantees of Origin (GO).

Strategic Relevance for BioShare

BioShare’s gasification and methanation platform, which can incorporate RFNBO-compliant green hydrogen or syngas from biogenic CO₂, is well-positioned to supply synthetic methane and other fuels aligned with RED III. Our process design supports real-time renewable integration, enabling downstream customers to meet RED III compliance targets while securing emissions reductions and revenue from high-value green gas.