The European Commission has selected nine hydrogen production projects across seven countries under the third auction of the European Hydrogen Bank (EHB), allocating approximately €1.09 billion in funding through the Innovation Fund to accelerate Europe’s clean hydrogen transition and industrial decarbonisation.
The selected projects, located across the European Economic Area (EEA), are expected to deliver nearly 1.1 GW of electrolyser capacity and produce more than 1.3 million tonnes of renewable and low-carbon hydrogen over their first decade of operation. The projects are projected to avoid approximately 9 million tonnes of CO2 equivalent emissions during the same period.
The funding, sourced from the EU Emissions Trading System (ETS), is aimed at supporting hydrogen deployment in energy-intensive industries including transport, chemicals, maritime, and aviation sectors. The initiative is also expected to strengthen Europe’s industrial competitiveness, energy security, and clean energy leadership.
Under the auction mechanism, selected projects will receive fixed subsidies ranging from €0.44/kg to €3.49/kg of certified hydrogen produced over a maximum period of 10 years. The support is designed to bridge the gap between production costs and prevailing market prices, thereby incentivising large-scale clean hydrogen production.
Among the selected projects under the Renewable Fuels of Non-Biological Origin (RFNBO) General category are projects in Greece, Spain, Denmark, and Austria. Denmark-based projects dominated the category in terms of production scale, including the 300 MWe NJK project by MorGen, expected to produce 445,000 tonnes of hydrogen over 10 years, and the 100 MWe ALBA project by Hy2gen Nordic AS.
Under the RFNBO Low Carbon category, Finland’s Cloudberry project by Vetyalfa Oy secured the lowest bid price at €0.44/kg and is expected to deliver 500 MWe of electrolyser capacity with more than 508,000 tonnes of hydrogen production over a decade. Germany’s Lotse project was also selected under this category.
In the dedicated Maritime-Aviation category, two Norwegian projects — Gen2-LH2 by Gen2 Energy AS and RogalandH2 by GREEN H AS — were selected to support hydrogen supply for hard-to-abate transport sectors.
The European Commission stated that the auction process was based on competitive bidding, with projects ranked according to the subsidy required per kilogramme of hydrogen produced. Funding was allocated in ascending order of bid price until the available budget was exhausted.
Additionally, Spain and Germany are participating through the ‘Auctions-as-a-Service’ mechanism, contributing a combined €1.7 billion in national funding to support additional hydrogen projects within their territories. Germany has committed up to €1.3 billion for RFNBO hydrogen production, while Spain will provide up to €440 million.
Projects placed on the Innovation Fund reserve list and falling within participating Member States’ funding allocations may be transferred to national authorities for grant agreement preparation. According to the Commission, this mechanism may support three projects in Spain and three in Denmark.
The European Climate, Infrastructure and Environment Executive Agency (CINEA) will now begin preparations for grant agreements with the selected projects, which are expected to be signed in the fourth quarter of 2026.
Selected developers will be required to achieve financial close within two and a half years of signing the agreements and commence operations within five years. The projects will also provide completion guarantees to the Commission as part of the funding conditions.
The third European Hydrogen Bank auction closed on 19 February 2026 and attracted 58 bids from 11 countries, with applications exceeding the available €1.3 billion budget by more than six times.
The Innovation Fund, financed through the EU ETS, has an estimated budget of €40 billion for the 2020–2030 period and supports the deployment of innovative net-zero technologies across Europe.
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