European Hydrogen Bank linked with Germany’s H2Global scheme to support hydrogen ramp-up
The European Hydrogen Bank, an initiative by the European Commission to facilitate both renewable hydrogen production within the EU and imports, has been linked with Germany’s H2Global support scheme to enhance global hydrogen ramp-up.
European Commissioner for Energy Kadri Simson and German Federal Minister for Economic Affairs Robert Habeck agreed to link the new European Hydrogen Bank with H2Global during their bilateral meeting in Lower Saxony, Germany, on 31 May.
As explained, this approach means that H2Global will be open to all Member States interested in running their own hydrogen tenders. The initiative will also jointly develop a European auction targeting international hydrogen imports.
After assigning an €800 million budget for the first pilot auction of the domestic European Hydrogen Bank, to be launched before the end of the year, this agreement is said to set in motion the Bank’s external pillar for the much-needed imports of renewable hydrogen from outside the EU.
Commissioner Simson commented on the agreement: “Hydrogen is key for the full decarbonisation of our energy system, alongside energy efficiency, renewables, and electrification. EU’s renewable hydrogen policy has developed rapidly in recent years, and the RePowerEU Plan has given it a definite boost. I am glad to see that Germany is the first mover in setting up an international auction. We are ready to build on this experience and develop the first European auction with the European Hydrogen Bank, open to all EU countries.”
Minister Habeck said: “Germany is set to invest more than €5 billion towards international hydrogen purchases in the forthcoming years. The first auctions are already taking place. This encouraging model is open to international partners. I therefore strongly welcome the idea of joining forces and making H2Global an integral part of the European Hydrogen Bank.”
In response to Russia’s invasion of Ukraine, on 18 May 2022, the European Commission published the REPowerEU package which included the market ramp-up of hydrogen as one of its central elements. By 2030, the European Commission aims for the EU to produce 10 million tonnes of renewable hydrogen and to import another 10 million tonnes of renewable hydrogen from third countries. So far, the EU has saved almost 20% of its gas consumption, doubled the additional deployment of renewables, and replaced 80% of Russian pipeline gas, the Commission said.
H2Global is promoting a timely and effective technology and the market ramp-up of green hydrogen and hydrogen derivatives. The German Federal Ministry for Economic Affairs and Climate Action is already providing €900 million in funding for the first ‘funding window’ of this auction-based instrument and is currently preparing further auctions, as is the Federal Ministry for Digital and Transport.
The implementation and further development of H2Global are being carried out by the non-profit H2Global Foundation, whose subsidiary HINT.CO GmbH (Hintco) uses the funding provided to compensate for the difference between supply and demand prices.
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The decision to link the European Hydrogen Bank with H2Global was welcomed by Hydrogen Europe, the European association representing the interest of the hydrogen industry and its stakeholders.
“We definitely need this step forward in order to remain credible with the implementation of the EU Hydrogen Strategy,” said Jorgo Chatzimarkakis, CEO of Hydrogen Europe. “We will need more renewable hydrogen than we can produce inside the EU in the required timeframe, particularly for the hardest to abate sectors. And we also need it at a competitive price.”
Daniel Fraile, Chief Policy Officer at Hydrogen Europe, added that “We need speed, determination and a strong EU policy to kick-start the European hydrogen industry. Otherwise, we will fall behind and the competitive and abundant renewable hydrogen will flow to other industrial regions. Let’s hope that the new body can start its operation quickly and set the first auction in the next months.”