Brussels / Hamburg, October 9, 2023 – The last week of September was an important stepping stone towards the development of a global hydrogen market, and for bringing Europe's hydrogen strategy to life. Around 400 representatives of the private sector from across Europe gathered in-person and virtually at the European Hydrogen Bank Workshop, hosted by the European Commission in Brussels. Participants, representing the EU Commission, H2Global, European Investment Bank (EIB), industry associations, renewable hydrogen producers, end-users, and transmission and distribution operators. discussed the need for joint European auctions for the import of renewable hydrogen to the EU and how best to implement them.
The EU is set to shape the global hydrogen market. It aims to import 10 million tonnes of renewable hydrogen by 2030, equivalent to 40 percent of the world’s global market at that time, according to the International Energy Agency. This is in part driven by a rapidly expanding European renewable hydrogen demand, expected to double between 2030 and 2040; domestic production constraints within Europe; and the expectation of growing volumes of hydrogen produced for export purposes between 2030 and 2040.
The renewable hydrogen market is still in its infancy. For it to deliver the large volumes required by the EU, at competitive prices that can benefit Europe’s industry and energy security, will require innovative approaches as the one developed and implemented by H2Global.
On May 31, EU Commissioner, Kadri Simson, and Germany’s Minister of Economic Affairs and Climate Action, Robert Habeck, invited EU Member States to consider using the H2Global instrument to develop joint auctions for the import of renewable hydrogen under the European Hydrogen Bank.
As a next step, an EU Member States workshop took place on 26 September in Brussels with the participation of 17 Member States, the Commission, H2Global and the EIB. The interest in developing a joint hydrogen import auction was clear by many Member States. Some Member States advocated for the adoption of the H2Global mechanism for any potential joint hydrogen import auctions, for speed, efficiency and to benefit from the lessons learnt. Others indicated a preference to focus on domestic production either to meet own needs or to export within the EU market. These diverse views warrant a flexible approach, allowing Member States to participate as needed, while ensuring coordination across the EU.
On September 28, in her opening remarks, at the European Hydrogen Bank Workshop, EU Energy Commissioner Kadri Simson shared with the private sector participants the idea of promoting renewable hydrogen imports to Europe by pooling resources under a TeamEurope approach using the H2Global mechanism under the European Hydrogen Bank. She encouraged participants to provide feedback on auction design, allocation, and criteria. Commissioner Simson emphasized, “The H2Global instrument allows us to pool Member States’ resources to organise joint European auctions, but it is at the same time flexible enough to accommodate any specific requests from Member States.”
As Markus Exenberger, Executive Director, H2Global Foundation, underscored at the September 28 event “H2Global has invested over two years preparing its ongoing auctions, working with national governments and the EU Commission, developing a blueprint that will allow for quick rollout of new auctions using the H2Global mechanism”. Timo Bollerhey, CEO, Hintco, added that “bringing multiple Member States together using the H2Global mechanism for joint renewable import auctions will help increase scale, attract potentially more bidders, and more competitive prices, all of which will speed up the hydrogen market development in Europe and globally”.
Private sector representatives participating at the September 28 Workshop expressed strong commitment and keen interest in advancing Europe's renewable hydrogen international auctions. They recognized H2Global’s mechanism’s potential as a practical and immediately applicable solution to promoting renewable hydrogen imports to Europe, which are needed to meet the industry’s demand and diversify supply.
The workshop represented a step forward in Europe's journey toward a future powered by renewable hydrogen. It demonstrates the region's dedication to environmental sustainability, achieving energy independence, industrial competitiveness, and assuming a leading role in the global hydrogen sector.
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H2Global consists of the H2Global Foundation and its Hydrogen Intermediary Company Hintco GmbH.
The H2Global Foundation is a non-profit European organization, founded in 2021 and based in Hamburg, Germany. 61 leading worldwide private sector companies are donors of the foundation. H2Global accelerates the emergence of markets for clean hydrogen and other zero and low emissions technologies in Europe and globally. H2Global’s mechanism offers long-term offtake agreements with fixed prices and volumes that provide investment security and bankability. H2Global’s mechanism also helps enhance competitiveness by compensating the difference between supply and demand prices. This combined with the double auction conducted by Hintco minimizes the cost of difference to be compensated through grants from governments/philanthropy and acts as a catalyst for private investment by providing price signals on the supply and demand side. Currently, approximately 6.1 billion Euros of funding have been provided or earmarked for H2Global-run auctions.