EU reduces ‘Made in Europe’ electrolyser ambition to 40% but demands 100GW green hydrogen capacity by 2030


Hydrogen Insight

European Commission urges EU manufacturers to scale up to make it happen, as it also drops key financing provision


European electrolyser manufacturers were urged to scale up their production capacity today (Thursday), as the European Commission (EC) published its new proposals to mandate that around 40% of all installed electrolyser capacity in the bloc is "Made in Europe" — a reduction from the 50% target revealed in a leaked draft proposal last week.


EU manufacturing capacity of “strategic net-zero technologies” ­— of which electrolysers are one — will need to “approach or reach” 40% of Europe’s total annual deployments needs, the EC said in its proposed Net Zero Industry Act, published this afternoon.


The Act is widely believed to be an attempt to stave off the commercial threat to Europe's clean technology manufacturers from their Chinese competitors.


For electrolysers, the overall deployment target is 100GW by 2030, the draft act said.


This would leave European electrolyser manufacturers needing to scale up enough to produce around 40GW capacity over the seven years to 2030.


It is not yet clear how such a target could be enforced — or where the cash to incentivise electrolyser manufacturers would come from.


Last week’s leaked draft proposal also indicated that all EU member states would have to allocate a certain percentage of national revenues from the EU’s Emissions Trading Scheme (ETS) towards local green-tech manufacturing such as electrolyser production.


However in the final proposal this target is left out. Instead, the EC proposes that member states “may use a share” of the ETS revenues for the local clean-tech manufacturing.


The EU also published its draft Critical Raw Materials Act, which sets out proposals to mine, process and recycle strategically important materials, including platinum group metals (PGMs) essential for the production of some fuel cells and electrolysers. The Act also makes provisions to set up a club of "like minded" nations with which the EU can trade critical raw materials.


Meanwhile, the EU also fleshed out its plans to finance domestic and international hydrogen production via the €3bn (£3.17bn) European Hydrogen Bank (EHB), first announced by the EC’s executive vice president Frans Timmermans last year.


The EC has already announced plans to launch a €800m pilot auction in the autumn that will allow domestic green hydrogen producers to bid for a ten-year “fixed premium” — essentially a top-up subsidy in €/kg — on the H2 they produce.


The final workshop on the design for the auction with stakeholders including member states, banks, academics, utilities and producers is now due in May, with the rules expected to be published in the summer.


The pilot will provide key data for the sizing of future auctions it said.


But crucially, the EU is also preparing to allow member states to use the auctions to channel their own subsidy programmes to green hydrogen producers, subject to the EU’s state aid rules, in a process the EC has dubbed “auctions-as-a-service”.


This will avoid duplication of work,and save money, the EU’s communication on the Hydrogen Bank, said.


On the international front, the EU has essentially delayed making any firms decisions or commitments until they end of the year, when it says it will have come up with a proposed funding mechanism. It is, however considering a similar fixed premium model to that designed to support domestic producers, with the possibility of expanding this further to the “double-auction” model favoured by Germany’s H2 Global subsidy scheme. 


Source:Hydrogen Insight


Hot News

FuelCellChina Interviews