EC clears EUR 1bn Dutch state aid for green hydrogen

The European Commission (EC) today gave the green light for a EUR 998 million (USD 1.08bn) Dutch scheme to support the production of renewable hydrogen as well as EUR 80 million state aid to be granted to the Djewels demonstration project for an innovative green hydrogen production technology.

The funding under the support programme aims to facilitate the development of a minimum of 200 MW of electrolysis capacity in the Netherlands as part of the country's plan to have 500 MW of electrolysers installed in 2025. Financial support will be allocated via an auction set to be completed in 2024. Projects eligible for the tender must have a capacity of at least 0.5 MW.

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Following a review, the Commission found that the "scheme is necessary and appropriate to facilitate the production of renewable hydrogen" and has an incentive effect.

The support will be provided as a direct grant, consisting of an upfront investment grant covering up to 80% of the investment costs, along with a variable premium over a period of five to 10 years. Recipients must demonstrate adherence to EU standards for the production of renewable fuels of non-biological origin (RFNBOs).

In addition, the Commission cleared a measure to support a demonstration project of a subsidiary of hydrogen company HyCC B.V. for a period of three years. The project, described as the first of its kind in the EU, seeks to prove the viability of generating renewable hydrogen using an alkaline electrolyser equipped with high current density electrodes, capable of producing high-pressure hydrogen while maintaining a compact size. The electrolyser will have a capacity of 20 MW and will be owned and operated by HyCC's subsidiary Djewels B.V.

The aid distributed as a direct grant will cover the expected funding gap of the project. Construction work on the electrolyser is set to begin in 2024 while commissioning is planned for 2027.