The European Commission has allocated €1.09 billion in support through the third auction of the European Hydrogen Bank, with nine projects selected in seven countries. The tender round was significantly oversubscribed with 58 bids from 11 countries. It awarded fixed hydrogen production incentives ranging from €0.44 ($0.51)/kg to €3.49/kg.
The European Commission allocated 1.1 GW of electrolysis capacity during the third hydrogen auction it launched in December.
The tender, conducted by the European Hydrogen Bank, has selected nine projects across seven countries and earmarked €1.09 billion ($1.28 billion) in EU funding.
“The auction rewards successful projects with a subsidy to help cover the price difference between production costs and the market price. The aim is to stimulate the production and use of clean hydrogen,” the EC said in a statement. “Upon signing their grant agreements, the nine selected projects will receive a fixed premium of €0.57 to €3.49 per kilogram of certified and verified hydrogen produced, for a period of up to 10 years.”
A diverse portfolio of projects was selected in the categories of general renewable fuels of non-biological origin (RFNBO), low-carbon fuels and maritime aviation.
In the general RFNBO category, five projects were selected in Greece, Spain, Denmark and Austria. The Greek AN-1-B and the Spanish T2X projects will provide small-scale production of renewable hydrogen at bid prices below €0.65/kg. Denmark has secured two of the largest projects in this category: NJK, led by MorGen, with a capacity of 300 MW and an expected production of 445,000 tons of hydrogen, and Alba from Hy2gen Nordic AS with 100 MW and an expected production of more than 144,000 tons. The Austrian Hy4IND project will support industrial decarbonization through a 5 MW electrolysis plant.
In the low-carbon category, Finland’s Cloudberry project emerged as the largest project selected in the auction, combining a capacity of 500 MW with an expected production of more than 508,000 tonnes of hydrogen over ten years. She offered the lowest bid of €0.44/kg. The German Lotse project will contribute another 120 MW and more than 140,000 tons of hydrogen production capacity.
In the maritime aviation category, two Norwegian projects, named Gen2-LH2 and RogalandH2 respectively, have been selected to support the decarbonization of hard-to-decarbonize transport sectors. Notably, these two projects offered the highest bid prices in the auctioned portfolio, at €3.48/kg and €3.49/kg respectively. Together they will deploy approximately 24 MW of electrolyser capacity over the next ten years and produce almost 36,000 tons of renewable hydrogen.
The auction received 58 bids from 11 countries, meaning demand was more than six times higher than the available budget of €1.3 billion.
The European Hydrogen Bank’s first auction started in November 2023 with a ceiling price of €4.50/kg of renewable hydrogen produced. 132 bids were received for 8.5 GW of electrolysis capacity, exceeding the available budget. The EC has awarded almost €720 million to seven projects in Finland, Norway, Portugal and Spain. They submitted bids between €0.37/kg and €0.48/kg and plan to produce 1.58 million tonnes of renewable hydrogen in ten years.
The second auction started in December 2024. Subsequently, 15 sustainable hydrogen production projects were selected for public financing across the European Economic Area (EEA) and €992 million in grants were awarded. The selected projects achieved feed-in premium rates ranging from €0.20/kg to €1.88/kg – levels judged by some observers to be very low, casting doubt on the viability of the projects.
This content is copyrighted and may not be reused. If you would like to collaborate with us and reuse some of our content, please contact: editors@pv-magazine.com.
