EU Commission: Green light for multi-billion hydrogen financing – Economy

EU Commission: Green light for multi-billion hydrogen financing – Economy

Germany and other EU countries can support the development and expansion of the European hydrogen industry for up to 5.4 billion euros. Photo: Bernd Weißbrod/dpa

The climate and energy crisis shows that Europe urgently needs to move away from fossil fuels. There is great hope that hydrogen can also replace coal, oil or natural gas in the future.

Brussels – In the fight against climate change, Germany and other EU countries can support the European hydrogen industry with up to 5.4 billion euros. The EU’s competition authority has given the green light to multibillion-dollar subsidies to support the energy transition, according to news from the EU Commission on Friday. The authorities think that the funding should stimulate additional private investment of around nine billion euros.

According to the Federal Ministry of Economy and Finance, the funding that has now been approved is the first of several waves. There are four first projects from Germany. “More projects from Germany are still in the approval process,” said the ministries. Friday’s decision is about technology. A wave of industrialization is expected in the autumn. In addition, regional mobility and infrastructure projects are being planned.

Many major projects have already been selected

In Germany, according to the Ministry of Economic Affairs, the federal government has already selected 62 large projects for the project. These will be funded by more than eight billion euros in state and federal funds. As a result, the federal government expects an investment of 33 billion euros in Germany alone. The eight billion planned by the federal government is related to all waves, including those that have not yet been approved by the federal government.

“Hydrogen has enormous potential for the future. It is important for the diversification of energy sources and ecological change,” said EU Competition Commissioner Margrethe Vestager. Internal Market Commissioner Thierry Breton stressed that the plan could lead to EU companies becoming leaders in the hydrogen sector.

Funding bylaws

Because hydrogen production is considered an important project of common European interest, a so-called “Key Project of Common European Interest” (IPCEI) has been launched at the EU level. Therefore, less strict rules apply when companies are supported by government money. There is a similar project to establish a production facility for battery cells for electric vehicles in Europe. According to the EU Commission, 20,000 jobs will be created directly by the hydrogen IPCEI.

Above all, green hydrogen – i.e. hydrogen that is produced with renewable energy – is a beacon of hope for the energy transition. In principle, hydrogen can be used as a fuel base, replacing coal, oil and natural gas in industry and transportation, for example. However, its production uses a lot of energy and is currently still more expensive compared to fossil fuels.