- Benbros Energy withdraws from the EU Hydrogen Bank auction, forfeiting €100 million in green hydrogen subsidies.
- Six companies will invest €694 million in funding to develop 1.4 GW of electrolysers, producing 1.5 million metric tons of green hydrogen over ten years.
- EU plans a new auction in December with stricter rules on using Chinese-made electrolyser equipment to boost local supply chains.
Spain’s Benbros Energy has withdrawn from the European Union’s (EU) Hydrogen Bank auction, forfeiting a significant subsidy for green hydrogen production. The European Commission (EC) confirmed that the company initially secured funding at 38 euro cents per kilogram of hydrogen but had not finalized the grant agreement.
Benbros’ exit leaves six other companies to continue with EU support for developing 1.4 gigawatts (GW) of electrolyzers. These projects will produce up to 1.5 million metric tons of green hydrogen over the next ten years. The EU Hydrogen Bank, backed by the EU Innovation Fund, aims to bridge the gap between the production cost of green hydrogen and the price off-takers are willing to pay.
The six companies still moving forward include a Finnish initiative receiving 37 euro cents per kilogram, two Portuguese projects at 39 and 48 euro cents per kilogram, two Spanish projects at 48 euro cents per kilogram, and a Norwegian project at the same rate. These projects will draw 694 million euros from the 800 million euro budget.
Benbros Energy, a solar company, declined to comment on its decision. The EC stated that Benbros forfeited around 100 million euros, which will now be allocated in future auctions. EC Policy Officer Johanna Schiele noted that the forfeited amount was insufficient to fund the next project on the reserve list.
Platts, an S&P Global Commodity Insights division, assessed the cost of green hydrogen production via alkaline electrolysis in Spain on October 8 at 6.48 euros per kilogram. This figure highlights the current challenge of making green hydrogen cost-competitive.
The EC plans to introduce new rules for its next auction, set for December, including restrictions on Chinese-made electrolyser equipment. This change aims to strengthen local supply chains and ensure compliance with EU regulations.
The EU’s first hydrogen auction attracted 132 bids from 17 countries, representing a total electrolyzer capacity of 8.5 GW. This high level of participation reflects growing interest in green hydrogen as a crucial energy source for the EU’s clean energy transition.
Benbros Energy’s withdrawal highlights the financial and logistical challenges in scaling green hydrogen technologies. Despite the setback, the remaining projects are progressing, keeping green hydrogen at the forefront of EU energy policy.
As the winners advance their projects, they remain vital to Europe’s plans to cut carbon emissions and support the transition to sustainable energy. These projects will play a critical role in the future of green hydrogen production and its integration into the EU’s energy landscape.