EU Backs Hydrogen Projects
The European Commission has selected nine hydrogen production projects across Europe for more than €1 billion in funding under the third auction of the European Hydrogen Bank, aiming to accelerate the region’s clean energy transition and strengthen industrial competitiveness.
The selected projects, located across seven countries in the European Economic Area, are expected to deliver nearly 1.1 GW of electrolyser capacity and produce more than 1.3 million tonnes of hydrogen during their first decade of operation. The projects are also projected to avoid approximately 9 million tonnes of CO₂-equivalent emissions.
Funding totaling around €1.09 billion will be provided through the EU Innovation Fund, financed by revenues from the EU Emissions Trading System (ETS). The support mechanism is designed to bridge the gap between hydrogen production costs and market prices through fixed subsidies paid per kilogram of certified hydrogen produced over a period of up to 10 years.
Subsidy levels awarded under the auction range from €0.44/kg to €3.49/kg depending on project category and market segment.
Among the largest projects selected is the Cloudberry project in Finland, coordinated by Vetyalfa Oy, which plans to deploy 500 MW of electrolyser capacity and produce more than 508,000 tonnes of hydrogen over 10 years. In Denmark, MorGen secured funding for the NJK project with 300 MW of planned capacity.
Other funded projects include initiatives in Greece, Spain, Austria, Germany, and Norway, including dedicated hydrogen supply projects targeting the maritime and aviation sectors.
The European Commission said the auction was heavily oversubscribed, attracting 58 bids from 11 countries and exceeding the available €1.3 billion budget by more than six times. Projects were ranked according to the level of subsidy requested per kilogram of hydrogen produced, with funding awarded to the most cost-competitive proposals.
In addition to EU-level funding, Germany and Spain are contributing a further €1.7 billion through the “Auctions-as-a-Service” mechanism, allowing member states to support additional domestic projects using the same EU auction platform. Germany committed up to €1.3 billion for renewable hydrogen production, while Spain allocated up to €440 million.
The selected projects are expected to support decarbonization efforts in energy-intensive industries including transport, chemicals, and heavy industry, while strengthening Europe’s hydrogen supply chain and reducing dependence on imported fossil fuels.
Grant agreements are expected to be finalised by the end of 2026. Projects will then have two and a half years to reach financial close and up to five years to begin operations.
