(Brussels Belgium) - The European Commission has approved France's application to promote the production of renewable and low-carbon hydrogen. This will support the development of electrolysis capacity with a cumulative output of one gigawatt.
First tender for 200 MW
The subsidies will be granted through three rounds of tenders. The first tender has an estimated budget of €797 million for 200 megawatts. Hydrogen produced under this scheme will be sold exclusively for direct industrial use, in order to limit its use to cases where there is no economically viable electrification alternative.
The aid will be granted in the form of a fixed premium. The contracts will be concluded for a period of 15 years. Aid recipients must demonstrate that they meet the EU criteria for the production of renewable non-biological fuels and low-carbon fuels (RFNBO). The support will help offset the additional costs incurred for the renewable electricity required for production, compared to cheaper fossil hydrogen.
The aid has an "incentive effect" because the production of renewable and low-CO2 hydrogen is still more expensive than the production of fossil hydrogen, and the aid recipients would not carry out the projects without public funding, according to the Commission's decision. France aims to build up an electrolysis capacity of 4,5 gigawatts by 2030, increasing to eight gigawatts by 2025. This is expected to save up to 1.100 kilotons of CO2 annually.
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EU approves funding for electrolyzers in France. © European Commission
