EU approves €900m German scheme to support green hydrogen production

Investments will be made in the production of renewable hydrogen in non-EU countries, which will then be imported and sold in the EU

Big Zero Report 2022

The European Commission has approved a €900 million (£751m) German scheme to support investments in the production of renewable hydrogen in non-EU countries.

Under the ‘H2Global’ scheme, the generated hydrogen will be imported and sold in the EU, with the aim of meeting demand for green hydrogen that is expected to significantly increase over the coming years.

Since almost no greenhouse gas is emitted in the production of renewable hydrogen, large reductions in greenhouse gas emissions can occur, when it displaces a fossil-based chemical.

The scheme, which will run for 10 years, will be managed and implemented by an entity named HINT.CO, which will conclude long term purchase contracts on the supply side and short term resale contracts on the demand side.

The lowest bid price for hydrogen production and the highest selling price for hydrogen consumption will be awarded contracts through competitive tenders.

The producers of renewable hydrogen and hydrogen derivatives such as green ammonia, green methanol and e-kerosene wishing to participate in the auctions will have to strictly comply with the sustainability criteria for renewable hydrogen and hydrogen derivatives production.

Executive Vice President Margrethe Vestager, in charge of competition policy said: “This €900 million German scheme will support projects leading to substantial reductions in greenhouse emissions, in line the EU’s environmental and climate objectives set out in the Green Deal. It will contribute to addressing the increasing demand for renewable hydrogen in the Union, by supporting the development of this important energy source in areas of the world where it is currently not exploited with a view to importing it and selling it in the EU.

“The design of the scheme will enable only the most cost effective projects to be supported, reducing costs for taxpayers and minimising possible distortions of competition.”

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