European Commission okays €1.2 billion Spanish renewable hydrogen scheme

July 29, 2024, by Aida Čučuk

The European Commission has approved a €1.2 billion Spanish scheme to support investments in renewable hydrogen production to foster the transition to a net-zero economy.

Courtesy of the European Commission; Photo by Mauro Bottaro

The scheme, approved under the State Aid Temporary Crisis and Transition Framework (TCTF), will be fully funded through the Recovery and Resilience Facility (RRF) following the Commission’s positive assessment of Spain’s Recovery and Resilience Plan and its adoption by the Council.

It will support investments in the production of renewable hydrogen with an installed capacity of at least 100 MW. Investments may encompass the production of renewable hydrogen-derived fuels, renewable hydrogen storage and the production of renewable electricity.

The Commission said that to be eligible under the measure, applicants should have secured agreements with off-takers to cover at least 60% of the renewable hydrogen or renewable hydrogen-derived fuel expected to be produced.

Under the scheme, the aid will take the form of direct grants covering the investment costs of the projects supported, and the amount for each beneficiary will be determined on the basis of a competitive bidding process. The aid will be granted before December 31, 2025.

Margrethe Vestager, Executive Vice-President in charge of competition policy, stated: “This €1.2 billion scheme will enable Spain to accelerate the deployment of renewable hydrogen capacities, in line with the EU Hydrogen Strategy and the European Green Deal. The scheme will also help Spain reduce its dependence on imported fossil fuels, while minimising any potential distortions to competition.”

To remind, in 2024, the European Commission also approved two German schemes: an estimated €3 billion scheme to support the construction of the Hydrogen Core Network (HCN) and a €350 million scheme to support the production of renewable hydrogen. Furthermore, it approved a €900 million French scheme to support companies investing in the use of biomass and renewable hydrogen in energy and fuel production.

As for 2023, the Commission approved a €246 million Dutch scheme to support the production of renewable hydrogen and the construction of at least 60 MW electrolysis capacity, a €450 million Italian scheme to support the production of renewable hydrogen, as well as a €170 million Danish scheme to support the production of renewable hydrogen through Power-to-X (PtX) technologies.