Outcome of the European hydrogen bank auction: Seven projects funded

The European Hydrogen Bank's recent pilot auction, which concluded on April 30, 2024, marked a significant step forward in Europe's commitment to renewable hydrogen. This initiative, supported by the Innovation Fund, aimed to bridge the gap between the cost of producing renewable hydrogen and the market price, thereby promoting large-scale hydrogen projects across Europe.

Overview of the Auction

The auction received 132 bids from 17 European countries, reflecting a strong interest from the industry. Ultimately, seven projects were awarded funding, totaling €720 million. These projects are expected to produce 1.58 million tonnes of renewable hydrogen over the next ten years, helping to avoid more than 10 million tonnes of CO2 emissions.

Funded Projects

The seven projects selected are spread across four countries:

1. Spain: Three projects

2. Portugal: Two projects

3. Norway: One project

4. Finland: One project

The awarded projects will receive a fixed premium per kilogram of hydrogen produced, with the premium ranging from €0.37 to €0.48 per kilogram of hydrogen. This is significantly below the ceiling price of €4.5, demonstrating the competitive nature of the bids.

Project Details

• Spain: The Spanish projects will focus on large-scale electrolysis facilities, leveraging the country's abundant renewable energy resources to produce green hydrogen at competitive costs.

• Portugal: Portugal's projects are similarly aimed at utilizing its renewable energy potential, with an emphasis on integrating hydrogen production into the existing energy infrastructure.

• Norway: The Norwegian project will exploit the country's extensive renewable energy capabilities, particularly hydropower, to produce hydrogen for both domestic use and export.

• Finland: The Finnish project will enhance the country's renewable energy portfolio by integrating hydrogen production with other renewable sources, aiming to create a sustainable and scalable hydrogen economy.
  

Background and Future Prospects

The European Hydrogen Bank was established to facilitate the EU's domestic production and imports of renewable hydrogen, aligning with the REPowerEU ambition for 2030. The pilot auction is part of a broader strategy to scale up renewable hydrogen production, essential for achieving the EU's climate neutrality goals by 2050.

Looking ahead, the European Commission plans to launch a second auction before the end of 2024, building on the lessons learned from this pilot phase. The high level of participation and the competitive pricing observed in the first auction indicate strong market interest and potential for further growth in the sector.

For more detailed information on the auction results and the funded projects, you can visit the European Commission's official announcement here.

By fostering innovation and competitiveness in the renewable hydrogen sector, the European Hydrogen Bank's initiatives are set to play a pivotal role in the EU's transition to a sustainable energy future.