The European Commission‘s pilot European Hydrogen Bank auction has received 132 bids from projects across 17 European nations, which far exceeds the available €800 million  (~$865 million) budget.

Collectively, the bids propose an electrolyzer capacity of 8.5 GW. This capacity is expected to generate 8.8 million tons of renewable hydrogen over a decade, covering nearly 10% of the European Union’s 2030 target for domestic renewable hydrogen production under the REPowerEU plan.

The tender for the projects was floated last November.

The auction allows renewable hydrogen producers to seek financial aid in the form of a fixed premium for each kilogram of hydrogen produced. The initiative aims to narrow the cost gap between renewable and fossil hydrogen production, making green hydrogen more economically viable.

“The applications are in, and the enthusiastic market response to the pilot auction shows the European hydrogen industry is ready to scale up. Renewable hydrogen is an important solution in Europe’s endeavor to reach climate neutrality by 2050,” said Kurt Vandenberghe, Director-General for Climate Action.

The European Executive Agency for Climate, Infrastructure, and Environment is reviewing the bids for compliance and eligibility. Following this, bids will be evaluated and ranked by price, with applicants set to be notified of the outcomes in April or May 2024.

Successful projects will then proceed to sign grant agreements by November 2024, committing them to commence renewable hydrogen production within five years. These projects will be eligible to receive the fixed premium subsidy for a decade, contingent on verified production of renewable hydrogen.

As the evaluation progresses, the European Commission plans to gather feedback from this pilot auction to refine the terms for a second auction round, which is likely to be launched later this year.

Last June, the European Commission proposed a detailed new framework for green hydrogen producers within the EU and from other countries exporting to the region to ensure it is produced using renewable electricity.

According to Deloitte’s 2023 Global Green Hydrogen Outlook, the green hydrogen market is expected to expand to 170 million tons of hydrogen by 2030 and reach 600 MT by 2050.