The European Commission has designated a staggering €720 million to bolster seven renewable hydrogen projects across Europe. These projects, meticulously selected through the inaugural competitive bidding process under the European Hydrogen Bank. Funding for this auction is sourced from the revenues of the EU Emissions Trading System.

Successful bidders will manufacture renewable hydrogen within Europe and benefit from a subsidy aimed at offsetting the cost disparity between their production expenses and the prevailing market rates, currently influenced by non-renewable producers. The renewable hydrogen generated will find application in various sectors including steel, chemicals, maritime transport, and fertilizers.

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 kilogram 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.

These are the selected projects:

In addition, through the new “Auctions-as-a-service” mechanism, €350 million in national funding has been made available by Germany for the highest ranked projects in Germany which did not qualify for EU-level support, but which do meet the eligibility criteria. The German authorities will select and communicate the winning projects. The “Auctions-as-a-service” scheme is open to all Member States, enabling them to benefit from the EU-level auction platform and award national funding to additional projects. The Commission invites other Member States to take advantage of this service for future auctions.

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 2024 at the latest.

Selected projects will have to start producing renewable hydrogen within a maximum of 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. It will draw on the lessons learned from this pilot auction and also further consult stakeholders before launching the next auction.