European Commission is set to open a series of tenders, with the first round offering 800 million euros in aid to community manufacturers. This initiative, part of the European Hydrogen Bank, aims to bolster the production of clean hydrogen, a crucial element in the EU’s ambitious climate targets.
European Commission President Ursula Von der Leyen made the announcement at the European Hydrogen Week, unveiling the commission’s strategy to support the burgeoning green hydrogen industry. The first tender, starting this week, allocates 800 million euros, with a second round of auctions set for spring 2024, totaling a substantial 3 billion euros.
The Hydrogen Bank is designed to bridge the gap between production costs and market prices for clean hydrogen manufacturers. The initial tender focuses on the “green bonus,” covering the additional costs of producing renewable hydrogen compared to market prices. Producers with the most economically efficient processes will secure the auction, fostering the growth of this promising industry.
The European Union envisions producing 10 million tons of hydrogen by 2030, constituting 14% of the bloc’s electricity consumption, with an equal amount imported. The Commission is actively forming alliances with countries like Egypt, Nigeria, Kenya, and Latin American states to further advance the green hydrogen agenda.
President Von der Leyen highlighted key projects, including a 10-gigawatt clean hydrogen and ammonia initiative in Brazil, in which the EU plans to invest 2 billion euros. The goal is to transport the products to Croatia and distribute them throughout Southeast Europe. The Commission aims not only to be a pioneer in green hydrogen but also a strategic partner.
By the end of the year, the European Commission plans to assess Member States’ plans for hydrogen implementation, providing a clear roadmap to 2030 for each EU country. This evaluation is crucial to ensure coordinated efforts in achieving hydrogen-related commitments.
Maros Sefcovic, the Vice-President responsible for the Green Pact, emphasizes the potential benefits of joint hydrogen purchases among EU member states. Drawing inspiration from collaborative gas purchases and the joint procurement of vaccines during the pandemic, Sefcovic advocates exploring the possibility of collective hydrogen procurement.
The second round of subsidy auctions under the European Hydrogen Bank is scheduled for spring 2024, reinforcing the commitment to propel the green hydrogen industry forward. These subsidies aim to level the playing field between renewable and fossil hydrogen, fostering a sustainable and competitive hydrogen market within the EU.