The European Commission announced a monumental step towards energy independence and decarbonization, awarding nearly €1 billion in public funding to 15 pioneering renewable hydrogen production projects. This significant investment, totaling €992 million, was announced on May 20 across the European Economic Area (EEA)

These 15 selected projects, spanning five European countries, are projected to yield an impressive 2.2 million tonnes of renewable hydrogen over the next decade. This output is anticipated to prevent over 15 million tonnes of CO2 emissions, with the green hydrogen earmarked for critical sectors such as transportation, the chemical industry, and the production of methanol and ammonia.

The funding, allocated through the second European Hydrogen Bank (EHB) auction, is designed to bridge the price disparity between the production costs of renewable hydrogen and its market price.

The European Hydrogen Bank auctions are instrumental in scaling up renewable hydrogen production, directly supporting the EU’s ambitious goal of producing 10 million tonnes of domestic renewable hydrogen by 2030, as outlined in the REPowerEU plan. This move is expected to significantly reduce Europe's reliance on fossil fuels, enhance energy security, create green jobs, and propel the decarbonization of European industries.

Among the successful bids, 12 projects will receive fixed premium support ranging from €0.20 to €0.60 per kilogram of renewable hydrogen. Notably, for the first time, the auction included a dedicated budget for hydrogen producers with off-takers in the maritime sector. This initiative resulted in three bids securing €96.7 million in grants, with subsidies ranging from €0.45 to €1.88 per kilogram to account for higher production costs in this specialized sector. Individual subsidies for the 15 projects vary widely, from €8 million to €246 million over a period of up to ten years.

The selected projects are now preparing their grant agreements with the European Climate, Infrastructure and Environment Executive Agency (CINEA), with signatures anticipated by September/October 2025. These projects are mandated to achieve financial close within two and a half years of signing and commence renewable hydrogen production within five years. They will receive their fixed premium subsidy for up to ten years upon certified and verified renewable hydrogen production.

Looking ahead, the European Commission has already announced plans for a third European Hydrogen Bank auction by the end of 2025, backed by an impressive budget of up to €1 billion.