EU Unlocks €5.2 Billion Public Funding for Green Hydrogen

The European Commission announced on Wednesday that it has approved a public funding of €5.2 billion by 13 member states to boost the supply of green and low carbon hydrogen. The state aid is expected to unlock €7 billion in private funding for a total of 35 projects involving 29 companies to support the research, deployment and construction of hydrogen infrastructure, referred to as IPCEI Hy2Use, the commission said.

The commission said IPCEI Hy2Use would support the construction of “large-scale electrolysers and transport infrastructure, for the production, storage and transport of renewable and low-carbon hydrogen.”

The initiative will focus on developing “innovative and more sustainable technologies for the integration of hydrogen into the industrial processes of multiple sectors” including glass, cement and steel.

“The IPCEI is expected to boost the supply of renewable and low-carbon hydrogen, thereby reducing dependency on the supply of natural gas,” the commission added.

Hydrogen has a diverse range of uses and applications, particularly regarding industries. The International Energy Agency (IEA) describes the fuel as a “versatile energy carrier”.

It can be produced in a number of ways. One method includes electrolysis, with an electric current splitting water into oxygen and hydrogen.

If the electricity used in this process comes from a renewable source such as wind or solar then some call it “green” or “renewable” hydrogen. Today, the vast majority of hydrogen generation is based on fossil fuels.

The Commission’s Executive Vice President Vestager said the investments approved under Hy2Use would enable an estimated 3.5 GW of electrolysis capacity, which would result in an output of approximately 340,000 tons of renewable and low-carbon hydrogen per year.

The European Commission has previously said it wants 40 GW of renewable hydrogen electrolyzers to be installed in the EU by 2030.

European Commission President von der Leyen last week expressed support for hydrogen during her State of the Union address.

Von der Leyen argued that hydrogen could be a game changer for Europe if they will be able to move their hydrogen market from niche to scale. She also pointed out the EU’s 2030 target to produce 10 million tons of green hydrogen annually.

“To achieve this, we must create a market maker for hydrogen, in order to bridge the investment gap and connect future supply and demand,” she added.

In order to achieve that, von der Leyen also announced the creation of a European Hydrogen Bank. It is hoped to be able to invest €3 billion to support the future market for hydrogen.

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