EU rolls out hydrogen mechanism to support market uptake

July 4, 2025, by Aida Čučuk

The European Commission has launched the Hydrogen Mechanism under the European Union (EU) Energy and Raw Materials Platform, aimed at supporting the market development of renewable and low-carbon hydrogen and its derivatives, including ammonia, methanol, and electro-based sustainable aviation fuel (e-SAF).

Illustration purposes only; Courtesy of the European Commission

It is understood that the online platform will host different mechanisms covering hydrogen, raw materials, natural gas, and biomethane, with the possibility to cover other products in the future. The first of these to enter into operation is the Hydrogen Mechanism, which is now open for stakeholder registration and subscription. The first round of matching demand and supply is reportedly planned for September 2025.

Dan Jørgensen, Commissioner for Energy and Housing, stated: “With the Hydrogen Mechanism launched today, we empower the European industry to seize competitive opportunities while advancing towards greater security of supply and decarbonisation. This is only the beginning of our work under the EU Energy and Raw Materials Platform, which shows that Europe is not just adapting to the future, it is actively shaping it.”

To note, hydrogen is expected to play a “key role” in decarbonizing hard-to-abate industries and is considered “essential” to the EU’s goals of climate neutrality by 2050 and its independence from Russian fossil fuels by the end of 2027.

As informed, the regulation on the internal markets for renewable gas, natural gas, and hydrogen mandates the European Commission to set up and operate a mechanism under the European Hydrogen Bank to support the market development of hydrogen for a limited duration until the end of 2029.

This Hydrogen Mechanism is intended to match and aggregate demand and supply, help identify infrastructure development needs, and facilitate access to information on financial solutions.

In other news, in 2025, the EU unveiled the Clean Industrial Deal, a business plan outlining concrete actions to turn decarbonization into “a driver of growth” for European industries by supporting renewable energy sources, and the European Commission announced it will allocate over €250 million in grants from the Connecting Europe Facility (CEF) to 21 hydrogen infrastructure development studies.

It is also worth mentioning that the Commission reached a Common Understanding with the UK that outlines a renewed agenda for cooperation, with a focus on new energy technologies such as hydrogen. Furthermore, it signed agreements with the European Investment Bank (EIB), KfW Development Bank (KfW), Corporación de Fomento de la Producción (CORFO), and the Chilean Ministry of Energy to support Chile’s renewable hydrogen industry.