Spain & Netherlands Promise Green Hydrogen Bonanza

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Spain and the Netherlands are promising billions of euros in support for the ramping up of green hydrogen projects following approval of state-financing schemes by the European Commission (EC).

The EC has approved Spain's 1.2 billion-euro (US$1.3 billion) plan to invest in renewable hydrogen projects with an installed capacity of at least 100 megawatts (MW). The Dutch government is promising 998 million euros (US$1.08 billion) as part of its goal to construct at least 200 MW of electrolysis capacity and will be open to projects with a capacity of at least 0.5 MW. The aid will be awarded through a competitive bidding process later this year. In both cases the EC said the schemes contribute to the development of renewable hydrogen in line with the objectives of the EU Hydrogen Strategy and the European Green Deal. They will also contribute to the objectives of the REPowerEU Plan to "reduce dependence on Russian fossil fuels and accelerate the green transition." The European Union (EU) wants to install at least 6 gigawatts (GW) of renewable hydrogen electrolysers by 2024, and at least 40 GW by 2030.

Spain has a 2030 target of 11 GW of electrolyser capacity for green hydrogen production, which is the highest in Europe, followed by Germany with a target of 10 GW. It is hoping to leverage its strong solar power resources to become Europe's leading source for green hydrogen. The Spanish scheme may encompass (i) the production of renewable hydrogen-derived fuels, (ii) renewable hydrogen storage and (iii) the production of renewable electricity. To be eligible, applicants should have secured agreements with off-takers to cover at least 60% of the renewable hydrogen or renewable hydrogen-derived fuel expected to be produced. After a competitive bidding process, the aid will take the form of direct grants covering the investment costs of the projects supported. Industrial Info is tracking more than 200 hydrogen-related projects in Spain worth almost US$20 billion in investment. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can click here for the reports.

"This 1.2 billion-euro scheme will enable Spain to accelerate the deployment of renewable hydrogen capacities, in line with the EU Hydrogen Strategy and the European Green Deal," said Margrethe Vestager, the Commission's executive vice president in charge of competition policy. "The scheme will also help Spain reduce its dependence on imported fossil fuels, while minimizing any potential distortions to competition."

The Netherlands is aiming for 500 MW of electrolyser capacity in 2025, up to 4 GW of green hydrogen in 2030 and double that amount by 2032. The proposed aid will take the form of a direct grant combining an upfront investment grant up to 80% of the investment costs and a variable premium over a period of five to 10 years. Beneficiaries will have to prove compliance with EU criteria for the production of renewable fuels of non-biological origin (RFNBOs). Industrial Info is tracking more than 90 hydrogen-related projects in the Netherlands worth over US$14 billion in investment. Subscribers can click here for the report.

Vestager commented: "Developing renewable hydrogen production is a key aspect of the EU's climate-neutrality goal. This Dutch scheme will help scaling up the production of renewable hydrogen in the Netherlands by providing support to electrolysers projects of all sizes, while ensuring that any potential competition distortions are kept to the minimum."

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