In a landmark decision, the European Commission has approved a $1.09 billion Dutch initiative to support renewable hydrogen production, aligning with the EU Hydrogen Strategy and the European Green Deal. This measure is also a pivotal component of the REPowerEU Plan, which aims to reduce reliance on Russian fossil fuels and accelerate Europe’s green transition.
The Dutch government announced its $1.09 billion scheme to bolster electrolysis capacity and renewable hydrogen production. The initiative will support the construction of at least 200 MW of electrolysis capacity, with the aid awarded through a competitive bidding process set to conclude in 2024. Projects with a minimum capacity of 0.5 MW are eligible to participate. “This initiative is crucial for advancing our renewable hydrogen capabilities and achieving our ambitious climate goals,” said Frans Timmermans, Executive Vice-President for the European Green Deal.
The financial assistance will be structured as a direct grant, combining an upfront investment covering up to 80% of the costs and a variable premium over 5 to 10 years. Beneficiaries must comply with EU criteria for renewable fuels of non-biological origin (RFNBOs), ensuring stringent environmental standards are met.
The Netherlands aims to reach 500 MW of electrolyzer capacity by 2025 and 3-4 GW by 2030. This scheme also supports the EU’s goals to install at least 6 GW of renewable hydrogen electrolyzers by 2024 and 40 GW by 2030. The Dutch government expects this initiative to reduce CO2 emissions by approximately 55 kilotons annually until 2030, significantly contributing to climate targets. "The Dutch scheme exemplifies how targeted public support can drive the green transition and foster sustainable innovation,” said Margrethe Vestager, Executive Vice-President of the European Commission.
The Commission’s assessment, conducted under EU State aid rules and the 2022 Guidelines on State Aid for Climate, Environmental Protection, and Energy (CEEAG), determined that:
This scheme follows a Dutch initiative approved in July 2023, focusing on small-scale electrolyzers (up to 50 MW). The 2022 CEEAG provides a flexible framework for assessing environmental and energy aid measures, aligning with the European Green Deal’s objectives.
The Renewable Energy Directive of 2018 set stringent criteria for RFNBOs like renewable hydrogen to ensure minimal environmental impact. The revised 2023 directive raises the renewable energy share target in the EU’s gross energy consumption to 42.5% by 2030. It introduces a new goal of 42% renewable hydrogen in total industrial hydrogen use by 2030 and 60% by 2035.
The 2020 EU Hydrogen Strategy set ambitious targets for clean hydrogen production and use, complemented by the European Clean Hydrogen Alliance, uniting various stakeholders. The 2019 European Green Deal Communication established net-zero greenhouse gas emissions by 2050, now enshrined in European Climate Law, which includes a target to reduce net greenhouse gas emissions by at least 55% by 2030.
