The first auctions of the Hydrogen Bank, backed by €800 million of European funding, will take place in November. This was confirmed by the President of the European Commission, Ursula von der Leyen, during her participation in the Clean Transition Dialogue on Hydrogen. She explained that this auction system will reward the most innovative and competitive companies which can produce hydrogen at the lowest cost.
“We will fill the gap between your production cost and the price that the market is currently willing to pay. And this will create a virtuous circle – where the hydrogen market scales up, and consumer prices go down. Clean hydrogen can go mainstream. And this will create new jobs, new economies of scale, and new business opportunities here in European Commission,” von der Leyen said.
She highlighted the important steps taken by the EU to develop hydrogen on the continent, putting hydrogen at the heart of the European Green Deal. With NextGenerationEU and RepowerEU, investments are being made in hydrogen valleys, hydrogen trains and clean steel factories. 17 billion in state aid has been authorised for 80 hydrogen projects across the EU.
“We defined what can and cannot be considered renewable hydrogen. We have sped up permitting for renewables and grids. So the EU regulatory framework for hydrogen is almost complete. We will soon have a full set of clear rules in place, to support our emerging hydrogen market. We are the only continent where this is the case. It means clarity and predictability for your investments,” she added.
There are 67 GW of electrolysers' capacity in the pipeline. It is well above the target of 40 GW by 2030 put in the hydrogen strategy. But von der Leyen said that the installed capacity is still too low. So it need to build a bridge between ambition and reality.
The Commission President also put forward new ideas for the sector: “I have proposed in my State of the Union address that we replicate with clean hydrogen what we are currently doing with gas. We could pool demand, on a voluntary basis, with the goal to increase demand, make it more visible, and match it with future production of hydrogen.”
In her speech, von der Leyen explained that the EU is developing a global market for clean hydrogen, signing hydrogen partnerships with countries ranging from Egypt, Kenya and Namibia to Latin American countries. "They have immense potential: wind, solar or geothermal resources in abundance. They could produce clean energy, transform it into clean hydrogen and send it to the world. And this is crucial, both to create a net zero local economy, and to meet the growing demand for hydrogen here in Europe. Europe wants to be the world leader in hydrogen, not just as a pioneer, but as a partner," she said.
She pointed out that the EU has international agreements to create a global hydrogen market, with an overwhelming private sector response. Europe is now attracting more investment in clean hydrogen than the US and China combined. 38 clean steel factories are either operational or planned, all powered by hydrogen.