EXCLUSIVE | Second EU hydrogen auction worth €2.2bn set to be delayed to autumn 2024
Spring deemed too early for next European Hydrogen Bank bidding round, sources tell Hydrogen Insight
The second €2.2bn ($2.4bn) auction of green hydrogen subsidies under the EU’s European Hydrogen Bank is set to be delayed by months in order to gather information from the first round, Hydrogen Insight has learned.
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Sign up nowThe next bidding round is now scheduled to take place this autumn, rather than in the spring as initially announced, although no final decision has been taken by the European Commission (EC), well-placed sources have told Hydrogen Insight on the understanding that their identities would not be publicly revealed.
EC president Ursula von der Leyen initially stated last November that the €2.2bn competition would open in the spring — which would have fallen a matter of weeks after the 8 February closure of the €800m pilot auction, and potentially before the winners of that round are announced.
Sources say that the delay until the autumn will give the EC time to consult with pilot auction participants in order to understand what went well and what could be improved.
This could result in some frustration among prospective European renewable H2 producers, who have in the past argued that the EU has been taking too long to get subsidy programmes and regulatory frameworks off the ground, delaying the construction of green hydrogen projects.
But given the time it will take to gather and assess feedback, an autumn 2024 launch for the second bidding round looks both “realistic” and “reasonable”, one of the sources told Hydrogen Insight.
The EC declined to comment on the timeline of the auction, with a spokesperson telling Hydrogen Insight: “The Commission intends to launch a second round of auctions in 2024. However, there are no other details at this stage.”
Winners from the first bidding round are due to be announced in April/May of this year, according to the EC, with grant contracts signed by November 2024.
The €800m pilot was vastly oversubscribed, with 132 developers applying for more than 8GW of capacity — enough to meet 10% of the EU’s target of reaching 10 million tonnes of annual production by 2030 — however, only a fraction of this capacity is expected to be successful.
The €2.2bn auction is likely to be similarly popular, with producers bidding for fixed premiums of up to €4.50 per kilogram of green hydrogen produced, with the aim of closing the price gap between fossil-fuel-derived hydrogen and H2 made from renewable energy.
Bids are being assessed on price, as well as a range of other criteria, with the lowest per-kg bids prioritised and ranked until the auction budget is exhausted.
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