- The European Commission has approved, under EU State aid rules, a €3 billion German-Dutch scheme to support the production of renewable fuels of non-biological origin (RFNBOs), including renewable hydrogen, throughout the world.
- These RFNBOs will be imported and sold in the EU, contributing to the objectives of the EU Hydrogen Strategy, the European Green Deal, as well as of the REPowerEU Plan to reduce dependence on Russian fossil fuels and accelerate the green transition.
Germany and the Netherlands notified the Commission of their intention to introduce a €3 billion scheme to cost-efficiently support RFNBO production. Germany will contribute to the scheme with €2.7 billion and the Netherlands will contribute with €300 million.
The scheme will support the construction of at least 1.875 GW of electrolysis capacity throughout the globe. The aid will be awarded through a competitive bidding process planned to be concluded in 2025. The tenders, organised on a multi-regional basis, will be open to projects with an electrolyser capacity of at least 5 MW.
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The scheme is based on a double auction system, which brings together RFNBO producers, most of which will be in non-EU countries, and RFNBO buyers in Germany and the Netherlands. The companies offering to sell RFNBOs at the lowest price, and to buy RFNBOs at the highest price, will each be awarded a contract for the sale or purchase of the RFNBOs produced under the scheme, with State resources filling the funding gap between the two prices.
Beneficiaries will have to prove compliance with EU criteria for the production of RFNBOs, as set out in the delegated acts on renewable hydrogen.
The scheme will contribute to meeting Germany’s and the Netherlands’ demand for RFNBOs from 2030 onwards. It will also support the EU’s ambition for renewable hydrogen technologies to be deployed on a large scale from 2030 onwards. Germany and the Netherlands expect that the scheme will lead to up to 5.73 million tonnes of CO2 equivalent being avoided, which will contribute to Germany’s, the Netherlands’, and the EU’s climate targets.
Author: Bryan Groenendaal
