The European Commission has selected nine hydrogen production projects for funding under the third auction of the European Hydrogen Bank, committing more than €1 billion to accelerate the region’s clean energy transition.
The projects, spread across seven countries in the European Economic Area, are expected to deliver nearly 1.1 gigawatts of electrolyser capacity and produce over 1.3 million tonnes of hydrogen in their first 10 years. This is projected to reduce greenhouse gas emissions by around 9 million tonnes of carbon dioxide equivalent.
The selected projects will receive about €1.09 billion from the Innovation Fund, which is financed through the EU Emissions Trading System. The hydrogen produced will mainly be used in sectors such as transport and chemicals, helping cut emissions in industries that are difficult to decarbonise, Hydrogen Central reported.
Under the scheme, projects will receive financial support to bridge the gap between production costs and market prices. Once agreements are signed, developers will be granted a fixed subsidy ranging from €0.44 to €3.49 per kilogram of certified hydrogen produced, for up to 10 years.
The funding was allocated through a competitive bidding process, with projects ranked based on the level of support they requested. Only those meeting eligibility and quality standards were selected until the available budget was fully used.
In addition to EU funding, Germany and Spain are contributing a further €1.7 billion through a joint mechanism that allows member states to support projects within their own borders. Germany has pledged up to €1.3 billion, while Spain will provide up to €440 million.
Next Steps
The European Climate, Infrastructure and Environment Executive Agency will now begin preparing grant agreements with the selected projects. These agreements are expected to be finalised in the last quarter of 2026.
Projects will need to secure financing within two and a half years of signing and become operational within five years. Authorities will monitor progress to ensure funds are used as planned.
Strong Interest in Hydrogen Investment
The latest auction attracted strong interest, with 58 bids from 11 countries—more than six times the available budget. The initiative aims to expand domestic hydrogen production and support low-carbon technologies, including for sectors such as shipping and aviation.
With a total budget of around €40 billion for the period 2020–2030, the Innovation Fund has already supported about 260 projects across Europe. The hydrogen auction system is designed to direct funding efficiently and help scale up clean energy solutions, supporting the EU’s long-term goal of climate neutrality.
