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EU may include ammonia plant exception in new renewable energy targets

(Reuters) - EU countries hope to pass a deal on new renewable energy targets on Wednesday and are considering options including an exemption for certain ammonia plants, in an attempt to win over countries skeptical of the final law, diplomatic sources said.

The European Union is attempting to finalize a key pillar of its climate agenda. If passed by EU countries and lawmakers, the renewable energy law will enshrine a binding goal for the EU to get 42.5% of its energy from renewable sources by 2030.

Countries' approval of the law has been delayed for weeks, after late opposition by France and other countries seeking more favorable treatment of nuclear energy in the bill. Nuclear energy is low-carbon, but not renewable.

The group of states, many of them in Eastern Europe and with nuclear energy interests, have also raised concerns over the fate of ammonia produced from hydrogen under the rules.

Sweden, which holds the EU's rotating presidency and chairs negotiations among EU countries, has put the law back on the agenda for a meeting of EU countries' ambassadors on Wednesday - signaling confidence that it now has enough support to pass.

Diplomatic sources said positions of some countries were unclear. Slovakia was expected to drop their previous opposition and support the final version, which would provide a large enough majority for the law to pass.

"We can confirm that discussion is going on and there are some movements. Of course, it is in everybody's interest to push this through as we need the agreement. A landing zone might be to have a recital on ammonia, which would help us to move," a Slovakian official said.

The ammonia preamble to the law could provide a limited loophole for hydrogen derived from non-renewable sources in calculating countries' renewable fuel targets, a draft version showed.

"Some specific integrated ammonia production facilities may need major industrial rebuild for consuming increased shares of hydrogen produced from electrolysis," the draft said.

Hydrogen produced in these facilities could be excluded from the baseline used to calculate countries' targets to use renewable fuels, it said, adding that these ammonia production plants should have plans in place to reach carbon neutrality by 2035.

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