The Second Hydrogen Auction Opens 3 December 2024

€1.2 billion available for European Renewable Hydrogen Projects

The second EU Innovation Fund Hydrogen Auction opens on 3 December 2024. With €1.2 billion available for European renewable Hydrogen projects, it will drive innovation in hydrogen production and boost resilience and sustainability (Renewable Fuel of Non-Biological Origin RFNBO).

Successful bidders will receive a fixed premium in €/kg for a maximum period of 10 years, closing the gap between production costs and market prices.

Key Updates for the Second Hydrogen Auction

🌍 Resilience and Security of Supply: Projects must contribute to a diversified supply chain and avoid building dependency on a single third country → Up to 25% (in MWe) of electrolysers incl. components can be sourced from China.
🥽 Compliance with standards: Electrolysers must comply with ISO 22734:2019, a recycling strategy must be reported, and projects must present a cybersecurity plan now of Entry into Operation (EiO).
📄Higher Maturity Levels: A feasibility study is required to contribute to assessing the maturity of the project → a template will be provided by CINEA.
🏭 Design rights & obligations: Projects must reach Financial Close within 2.5 years and Entry into Operation (EiO) within 5 years, now is a “tie-breaking rule” → recall that the average timing for the EiO of awarded projects in the last auction was 3 years.
⚓ Maritime Sector Focus: A dedicated €200 million budget is available specifically for projects that supply the maritime sector.
💰Updated maximum project size: €250 million for the general topic and €200 million for the maritime topic → only one maritime project might be funded
📉 Revised Price Ceiling: A new price ceiling of 4 €/kg has been introduced. However, “Next best projects” would have lied below 1 €/kg if €1.2Bn (hashtag#EHB) had been available → it is recommended to push under 0.8 €/kg
✅ Completion Guarantee: A completion guarantee covering 8% of the grant amount is required à a template will be provided by CINEA.