European Commission has approved a €1.3 billion ($1.5 billion) German state aid programme aimed at accelerating renewable hydrogen production under the European Hydrogen Bank’s “Auctions-as-a-Service” initiative.
The scheme, approved under European Union state aid regulations, is expected to support the development of large-scale green hydrogen infrastructure and contribute to the bloc’s industrial decarbonisation goals.
According to the European Commission, the initiative aligns with the objectives of the EU’s Clean Industrial Deal, the REPowerEU Plan aimed at reducing dependence on Russian fossil fuels, and the broader EU Hydrogen Strategy.
The programme is expected to support the installation of up to 1,000 megawatts of electrolyser capacity and facilitate the production of approximately 10 million tonnes of renewable hydrogen.
Officials estimate the initiative could help avoid nearly 55 million tonnes of carbon dioxide emissions over time.
The financial support will be allocated through a competitive bidding mechanism overseen by the European Climate, Infrastructure and Environment Executive Agency (CINEA).
Under the scheme, companies planning to build new electrolysers connected to the Danish Hydrogen Backbone pipeline network will be eligible for support. The infrastructure is designed to transport renewable hydrogen from North Sea production hubs to industrial buyers connected to the German Hydrogen Core Network.
The European Commission said the initiative will strengthen cross-border clean energy infrastructure while supporting the expansion of renewable hydrogen supply chains across Europe.
Financial assistance will be provided in the form of direct grants based on each kilogram of renewable hydrogen produced, with support available for a maximum period of ten years.
Beneficiaries will also be required to comply with EU standards governing renewable fuels of non-biological origin (RFNBOs).
The European Hydrogen Bank was established to accelerate renewable hydrogen production and imports across Europe by helping close investment gaps and linking future hydrogen supply with industrial demand.
The initiative forms part of the EU’s broader target to achieve 20 million tonnes of renewable hydrogen consumption by 2030 while advancing long-term climate neutrality objectives.
The hydrogen auction programme is financed through revenues generated under the EU Emissions Trading System and managed through the bloc’s Innovation Fund framework.
Industry analysts say the approval reflects Europe’s increasing focus on clean hydrogen as a strategic component of industrial decarbonisation, energy security and sustainable manufacturing transformation.
