EU awards $4bn to clean hydrogen and other decarbonisation projects

THE European Union has selected 41 projects to award €3.6bn ($4bn) in a bid to kickstart clean energy and technology projects that will help overall decarbonisation targets, with more than half of the projects involving clean hydrogen that could prove to be key for shipping’s decarbonisation targets.

The selected projects will receive funding from the EU’s Emissions Trading System’s revenues through the Innovation Fund, according to a press release.

French utility Engie’s subsidiary GDF has won a grant for its H2Sines project that aims to produce clean hydrogen in Portugal and export to the Dutch port of Rotterdam. It comprises of constructing a 400MW electrolyser, a large-scale liquefaction plant as well as export and storage facilities in Portugal’s Sines and Rotterdam. GDF plans to use an innovative vessel propulsion system using hydrogen boil-off gas to fuel polymer electrolyte membrane fuel cells.

Spanish utility Iberdrola’s project Green Meiga was also among the winners for its plans to produce up to 100,000 tonnes of green methanol annually in Galicia by building a 150MW electrolyser.

Germany-based energy giant Uniper’s 100MW electrolyser project at Rotterdam also won a grant, planning to produce up to 10,000 tonnes of green hydrogen per year.

There were several other winner projects that aim to produce renewable hydrogen-derived green methanol and green ammonia, including Greek oil refiner Motor Oil’s Iris and Fortescue Future Industries’ Holmaneset.

The EU adopted new legislation earlier this year to include shipping in the Emissions Trading System from 2024, with a three-year phase-in period where companies will buy allowances for 40% of emissions in 2024, then gradually increasing to 75% in 2025 and 100% in 2026. Companies will buy allowances for 100% of emissions for voyages within the European Union and the European Economic Area and 50% of emissions for voyages into or out of the European Union and the European Economic Area.

The bloc has been intensifying efforts to ensure domestic clean hydrogen production, as hefty subsidy packages in the US could drive more green investments across the Atlantic. Bernd Lange, head of the European Parliament’s trade committee, recently called for a tax on hydrogen produced in the US, according to media reports.