FRANKFURT: German utilities and gas transport lobbies said on Wednesday the government was hampering a rapid transition to using carbon-free hydrogen by proposing a phased-in approach for transporting the fuel to consumers.

Germany wants to scale up the use of "green" hydrogen - extracted from water via electrolysis powered by wind and solar energy, and phase out "grey" hydrogen - extracted mostly from natural gas - to get closer to carbon neutrality in the coming decades.

The government, trying to boost efforts to meet climate targets, last year approved a national hydrogen strategy to help to decarbonise the economy

On Wednesday, to prepare for the arrival of large volumes of green hydrogen, the cabinet approved a plan to provide for a switch of existing pipelines carrying grey hydrogen to green hydrogen, and to build entirely new pipelines for green hydrogen.

But the natural gas pipeline industry, which eventually needs to switch to hydrogen, wants an early merger of the two systems and criticised the government's approach for being to slow.

"The proposed regulations will not allow the speedy establishment of a sustainable hydrogen infrastructure," said Kerstin Andreae, chairwoman of the BDEW power and gas industry association.

The government's aim is to ensure that green hydrogen will initially flow directly to hard-to-electrify industries such as steelmaking and chemicals.

But the gas lobby wants the green hydrogen to flow via its existing natural gas grids immediately to ensure a more rapid shift to the new fuel, and also to benefit from grid usage fees.

"A dual-track regulation prevents a coordinated development of gas and hydrogen infrastructures and does not set a reliable framework for investors and market participants," Andreae said.

The industry wants to integrate the new alternative fuel into the existing infrastructure, which also includes gas storage caverns.

"The aim should be that a new network (for hydrogen) can evolve from out of the other one (natural gas)," said Thomas Goessmann, chairman of the FNB group of long distance gas shippers.