The European Commission approved a EUR 1.3 billion German aid scheme to support renewable hydrogen production through the ‘Auctions-as-a-Service’ instrument’ of the European Hydrogen Bank.
The aid – as Brussels explains in a note – will be awarded through a competitive bidding process overseen by the European Climate, Infrastructure and Environment Executive Agency (CINEA) and will be used to support the construction of 1 GW of electrolysis capacity, through which up to 10 million tonnes of renewable hydrogen can be produced over the 10-year programme, avoiding the emission of a total of 55 million tonnes of CO2.
The scheme will provide support to companies wishing to build new electrolysers to feed renewable hydrogen into the Danish Hydrogen Backbone 1 pipeline, infrastructure classified as Project of Common Interest, and deliver it to buyers connected to the core network German hydrogen pipelines. The aid will support not only renewable hydrogen production, but also cross-border infrastructure connecting production areas in the North Sea with industrial buyers.
Under the scheme, aid will take the form of a direct subsidy per kilogram of renewable hydrogen (classified as RFNBO according to RED III parameters) produced. Incentives will be granted for a maximum duration of ten years.
