EU approves €400 million to support hydrogen production in Spain

The scheme will contribute to the objectives of the Clean Industrial Deal to accelerate the decarbonisation of EU industry while strengthening its competitiveness, of the REPowerEU Plan to reduce dependence on fossil fuels and accelerate the green transition, as well as the EU Hydrogen Strategy.

The scheme

Spain notified the Commission of its intention to introduce a scheme to support the production of renewable hydrogen through the ‘Auctions-as-a-Service’ tool within the European Hydrogen Bank. The approved scheme will support construction of up to 345 MW of installed electrolyser capacity, and the production of up to 221 000 t of renewable hydrogen in Spain. This is estimated to result in the avoidance of the equivalent of up to 1 million t of CO₂. The scheme will help Spain achieve its national objective to install 12 GW of electrolyser capacity by 2030, as well as the targets for the share of renewable fuels of non-biological origin (RFNBOs) consumed in transport and in industry that are set in the Renewable Energy Directive.

The aid will be awarded through a competitive bidding process that concluded in 1Q25. The bidding process will be supervised by the European Climate, Infrastructure, and Environment Executive Agency (CINEA) which will receive, assess, and rank bids for projects in all Member States. The support provided under the schemes will be open to companies planning to construct new electrolysers in Spain.

Under the scheme, the aid will take the form of a direct grant per kg of renewable hydrogen produced. The aid will be granted for a maximum duration of 10 years. Beneficiaries will have to prove compliance with EU criteria for the production of RFNBOs. This includes contributing to the deployment or financing of the additional renewable electricity which is needed to produce the hydrogen supported under the scheme.

The Commission's assessment

The Commission assessed the scheme under EU State aid rules, in particular Article 107(3)(c) of the Treaty on the Functioning of the EU, which enables Member States to support the development of certain economic activities under certain conditions, and the 2022 Guidelines on State aid for climate, environmental protection, and energy (CEEAG).

In particular, the Commission found that:

• The scheme is necessary and appropriate to facilitate the production of renewable hydrogen and thus the decarbonisation of the industrial, transport, and/or energy sectors.
• The scheme has an incentive effect, as the beneficiaries would not carry out the relevant investments without the public support.
• Spain put in place sufficient safeguards to ensure that the scheme has a limited impact on competition and trade within the EU. In particular, the beneficiaries will be selected following an open, transparent, and non-discriminatory bidding process and the aid will be kept to the minimum necessary to undertake the projects.
• The aid will bring about positive effects, in particular on the environment, in line with the European Green Deal, that outweigh any possible negative effects in terms of distortions to competition.

On this basis, the Commission approved the Spanish scheme under EU State aid rules.

Read the article online at: https://www.globalhydrogenreview.com/hydrogen/16042025/eu-approves-400-million-to-support-hydrogen-production-in-spain/