Germany is becoming the first Member State to participate in the EU’s Auctions-as-a-Service scheme under the European Hydrogen Bank.
Through participating in the European Hydrogen Bank, Germany is set to make €350m available from its national budget for hydrogen production in the country. This investment is on top of the €800m already foreseen for European projects from the EU Innovation Fund.
The additional funding will help to attract more renewable hydrogen projects. Other Member States are welcomed by the Commission to take advantage of the service for future auctions.
Opening of the European Hydrogen Bank
On 23 November 2023, the European Commission opened the first EU-wide auction under the Innovation Fund to support renewable hydrogen production. The opening of the European Hydrogen Bank supports the objectives of the REPowerEU Plan, the Green Deal Industrial Plan, and the renewable hydrogen targets established in the Renewable Energy Directive.
The Bank will cover the difference between the cost of producing renewable hydrogen in the EU and the price that the market is willing to pay. The exact amount of the funding will be determined from a competitive bidding process.
The auction winner will be the renewable hydrogen producers who require the lowest amount of support in terms of euros per kilo of hydrogen produced.
Securing EU funding for renewable projects
The European Hydrogen Bank Auctions-as-a-Service scheme allows Member States to finance additional projects participating in the auction after the allocation of the Innovation Fund’s budget. This finance lets Member States identify and support competitive projects on their territory that have not secured EU funding without a separate national auction process. Participation from Member States is on a voluntary basis.
In upcoming bids, project developers must express their interest in using the Auctions-as-a-Service scheme to be eligible for selection. Support offered by Member States through this service will be regarded as State aid. Member States must notify their support to the Commission but will benefit from a streamlined State aid approval process, as the auctions are designed at EU level.
