Four of Seven Dutch Green Hydrogen Projects Cancelled

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The Netherlands awarded €783.5 million in subsidies to seven green hydrogen projects in 2022. Together they were supposed to deliver 1,150 MW of electrolysis capacity. Four years later, four projects representing 550 MW have been cancelled, and none of the original seven is operating. The November 2 parliamentary answers also confirm that the government cannot say when electrolytic hydrogen will become commercially viable without dedicated subsidies. Another €780 million is reserved for a future subsidy round anyway.

The TFIE Strategy Briefing follows what happened to the Dutch projects, what the government’s own cost and demand revisions imply, and which industrial activities could prosper without the hydrogen market originally forecast.

The €783.5 million was awarded, not spent. Roughly €150 million had been disbursed under the programme when the parliamentary answers were published. That distinction matters, especially when assessing potential losses to taxpayers. It does not make the project record look good. The Dutch state has spent four years supporting a group of plants that has so far delivered no operating capacity, while almost half the planned megawatts have been withdrawn.

The price assumptions were difficult to defend from the start. Officials say the original subsidy decisions reflected expectations that renewable hydrogen would cost around €2/kg by 2030 and become competitive with fossil-derived hydrogen within a decade. Making a kilogram by electrolysis typically requires about 50–55 kWh of electricity. Even at €50/MWh, a very cheap assumption for dependable electricity supplied to a European industrial facility, that power costs €2.50–€2.75 per kilogram before capital recovery, maintenance, water treatment, compression or delivery. Buying electricity only during the cheapest hours lowers the energy bill but leaves the electrolyser idle for longer, increasing the capital cost per kilogram produced. Eurostat’s latest industrial electricity data show how low the €50/MWh assumption is relative to ordinary non-household electricity prices, although large electrolysers would negotiate different contracts.

There are established industrial uses for hydrogen, particularly in chemicals and refining. The Dutch policy went considerably further, assuming domestic electrolysis could grow into a competitive source of energy for processes where direct electricity would often be cheaper. The cancellations have arrived alongside retreat from those anticipated markets, not as an isolated string of engineering setbacks. Lower-than-expected demand and expensive production are undermining the case for both the plants and the infrastructure intended to connect them.

The government’s September energy planning already gives hydrogen much less work in building heat and electricity generation. It also projects substantially less industrial hydrogen demand than earlier plans. Nevertheless, the proposed response includes more production subsidies, obligations for some industrial customers to buy renewable hydrogen, and measures to support a national pipeline network. Those choices keep public policy committed to volumes that commercial buyers have not shown they can afford.

The network has its own deteriorating economics. The Netherlands Court of Audit found that estimated investment had risen from €1.5 billion to €3.8 billion. Gasunie/Hynetwork Services estimated startup losses of up to €2.5 billion against a €750 million grant. These are forecasts, not bills already paid. But a pipeline system designed for a large future hydrogen market becomes harder to finance when that market contracts. Higher tariffs would make hydrogen less attractive to the customers it needs. Additional subsidies shift the burden elsewhere. The Court of Audit laid out the problem in December 2025.

Dutch chemical manufacturing, steel processing and port industries do not need to disappear as hydrogen expectations shrink. Some energy-intensive feedstocks can be produced where clean electricity is cheaper and imported for further manufacturing in the Netherlands. Industrial heat pumps and direct electric processes avoid producing and transporting hydrogen in the first place. Smaller refineries will also need less hydrogen as petroleum demand declines. These changes have different consequences for particular companies and workers, but they offer a more credible starting point for an industrial strategy than a hydrogen-volume target.

The government now faces another subsidy round with evidence it did not have in 2022: cancelled projects, higher costs, much smaller demand expectations and a pipeline investment whose customers are uncertain. It should evaluate the industrial products being made, the cost of the available decarbonization routes and the amount of hydrogen that those routes actually require before funding another large tranche of production capacity. Otherwise the next awards risk preserving yesterday’s forecasts at tomorrow’s expense.

My full TFIE Strategy Briefing analysis examines the project record, subsidy assumptions, pipeline exposure and alternatives for Dutch industrial production. It includes the implications for ammonia, steel and refining that are beyond the scope of this CleanTechnica article.