The European Commission is awarding nearly €720 million to seven renewable hydrogen projects in Europe, selected through the first competitive bidding process under the European Hydrogen Bank. The funds for this auction come from the revenues of the EU Emissions Trading System. The winning bidders will produce renewable hydrogen in Europe and will receive a subsidy to bridge the price difference between their production costs and the market price for hydrogen, which is currently driven by non-renewable producers. The European Hydrogen Bank is therefore contributing to the scale-up of cleaner fuels which will contribute to the decarbonisation of European industry. The renewable hydrogen they produce will be used in sectors such as steel, chemicals, maritime transport and fertilisers.
The 7 selected projects were the winners of an oversubscribed auction which attracted 132 bids in total. Together, the winning bidders plan to produce 1.58 million tonnes of renewable hydrogen over ten years, avoiding more than 10 million tonnes of CO2 emissions. The selected projects are located in 4 European countries. They submitted bids between €0.37 and €0.48 per kg of renewable hydrogen produced, and also met the other qualification requirements. The subsidy the 7 projects will receive ranges from €8 million to €245 million.
Next steps
The seven selected projects will now start preparing their individual grant agreements with the European Climate, Infrastructure and Environment Executive Agency (CINEA). These agreements are expected to be signed by November this year at the latest.
Selected projects must start producing renewable hydrogen within 5 years after signing the grant agreement. They will receive the awarded fixed premium subsidy for up to 10 years for certified and verified renewable hydrogen production.
The Commission plans to launch a second European Hydrogen Bank auction by the end of this year.
