The Dutch Government is set to launch a €998 million ($1.01 billion) green hydrogen subsidy auction from October 15 through the end of the month. This auction, which has received approval from the European Commission for state aid, aims to support the development of at least 200MW of electrolysis capacity in the Netherlands.
The auction will allocate up to 50% of the total budget to individual projects, with applicants ranked on a euro-per-megawatt basis. To qualify, projects must have a minimum size of 0.5MW. The Dutch Government will provide direct grants covering 80% of the upfront investment costs, along with a variable premium over a five to ten-year period.
Applicants will also need to demonstrate compliance with the EU's criteria for producing renewable fuels of non-biological origin (RFNBOs), as outlined in the delegated acts for renewable hydrogen.
Margrethe Vestager, European Commission Executive Vice-President, commented on the auction in July 2024, stating, "This €998 million Dutch scheme will help scale up the production of renewable hydrogen in the Netherlands by providing support to electrolyser projects of all sizes, while ensuring that any potential competition distortion is kept to a minimum."
Despite the growing demand for low-carbon hydrogen, recent data from ICIS Hydrogen Foresight revealed that no Dutch hydrogen projects have advanced beyond the final investment decision (FID). As of April 2024, production capacity was projected to increase to approximately 17GW by 2040, with 74% expected to be operational by 2035.
Source: h2-view