EU gives Belgium and 12 other members go-ahead for billion-dollar aid to hydrogen projects
Belgium and 12 other EU member states have been given the green light by the European Commission to pump up to 5,2 billion euros of state aid into innovative hydrogen projects. "State aid has a role to play in unlocking, attracting and leveraging large amounts of private investments. These investments would never happen otherwise", said Competition commissioner Margrethe Vestager.
Thirteen EU countries backed the Hy2Use project. They asked the Commission to allow public funding for a total of 35 sub-projects, in which 29 companies (including SMEs and start-ups) will participate. For our country, these include Engie Belgium, which is partaking in two projects, Fluxys and Wallonia-based TECforLime. It is estimated that the public support of up to 5,2 billion euros will attract 7 billion euros worth of private investments.
"The value chain for hydrogen in Europe is in its infancy. This makes it risky for companies and member states to invest on their own in such an innovative market"
The state aid should enable the construction of infrastructure to provide for the production, storage and transport of renewable and low-carbon hydrogen. In addition, it will support the development of innovative and sustainable technologies to integrate hydrogen into industries. In particular, this concerns processes in sectors that are relatively difficult to decarbonise or decarbonise, such as the steel, cement and glass sectors. The whole project is intended to encourage the supply of renewable and low-carbon hydrogen, leading to lower dependence on natural gas.
"The value chain for hydrogen in Europe is in its infancy. This makes it risky for companies and member states to invest on their own in such an innovative market", explained European commissioner Vestager, adding that "state aid has to play a role to unlock, attract and leverage large amounts of private investments. These investments would otherwise never happen."
The Hy2Use project could provide "breakthrough innovation and positive spillovers" to benefit the entire European economy.
Commission President Ursula von der Leyen pointed out that hydrogen could further reduce Europe's dependence on Russian gas and that the Hy2Use project could provide "breakthrough innovation and positive spillovers" to benefit the entire European economy. According to Internal Market commissioner Thierry Breton, the opportunity could arise to produce steel, cement and chemicals carbon-free and replace large quantities of fossil fuels.
As for the exact amount of public support participating companies will receive, the Commission cannot provide exact numbers yet. By 2036, the entire project should be completed.
In July, the Commission already approved another hydrogen project, also co-submitted by Belgium, which focuses on the mobility sector.
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