The European Commission has approved a EUR 400 million state aid program to support Spain's renewable hydrogen production. The program will be implemented under the European Hydrogen Bank's “Auction as a Service” instrument.
According to the Commission, the support program covers the installation of up to 345 megawatts of electrolyzer capacity and the production of up to 221,000 tons of renewable hydrogen. This will prevent the emission of around one million tons of carbon emissions.
The support will be distributed through a competitive bidding process, which will be finalized in the first quarter of 2025. The process will be managed by the European Executive Agency for Climate, Infrastructure and Environment (CINEA), and companies planning to invest in new electrolyzers in Spain can apply for the grant.
The support to be provided under the program will be in the form of a direct grant for each kilogram of renewable hydrogen produced and will be valid for a maximum of 10 years. Companies benefiting from the support will have to certify that their production complies with the EU criteria for non-biological renewable fuels.
The European Commission stated that the program will accelerate the decarbonization of the industrial, transport and energy sectors, while contributing to the climate goals of the EU Green Deal and the REPowerEU Plan. It also emphasized that support will only be granted to projects that pass a transparent, non-discriminatory and competitive selection process.
The Commission approved the program under EU state aid rules, noting that the subsidies are designed not to distort competition in the sector and that the environmental benefits far outweigh any potential negative impacts.
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