How will the EU’s roll-out of Germany’s H2Global hydrogen import scheme work in practice?
Two options to expand to European neighbours are on the table, according to Hintco CEO
Hydrogen: hype, hope and the hard truths around its role in the energy transition
The first option, dubbed the “Team Europe approach” by Hintco CEO Timo Bollerhey, would see member states setting up their own dedicated auction windows, run either by Hintco or by a subsidiary set up in that country.
The second option would see Hintco directly backed with funds from the EC, although this would require a so-called “pillar assessment” to allow it to manage EU funds. This would also require the EC to set the auction rules.
The Commission is due to run an auction within the EU this December, awarding a fixed premium of up to €4 ($4.32) per kilogram to cover the cost gap between grey and green hydrogen production.
However, he added that the Team Europe approach would allow member states to run auctions for domestic production and offtake.
(Copyright)H2Global’s double-sided auction mechanism
Hintco auctions ten-year purchase agreements for hydrogen or its derivatives from suppliers, who competitively bid to offer the lowest possible price.
H2 buyers then bid for sales agreements from the state intermediary company, with the difference in buy and sell prices covered by government funding.
The first three H2Global auctions for imports of green ammonia, methanol and e-SAF respectively are currently evaluating bids, with deliveries from winners expected by the end of 2024.