The European Commission has given its approval for a significant €1.2 billion initiative by Spain to boost investments in renewable hydrogen production, aligning with the objectives to transition towards a net-zero economy. This financial endorsement falls under the State aid Temporary Crisis and Transition Framework (TCTF), initially adopted on March 9, 2023, and subsequently amended twice.
Spain’s comprehensive plan aims to catalyze the development of hydrogen clusters or valleys, essential for the country’s ambitious net-zero transition. This scheme is to be fully financed through the Recovery and Resilience Facility (RRF), following the European Commission’s favorable evaluation of Spain’s Recovery and Resilience Plan and its subsequent approval by the Council.
The supported projects will focus on establishing renewable hydrogen production facilities with a minimum capacity of 100 MW. These projects may include the production of renewable hydrogen-derived fuels, renewable hydrogen storage solutions, and renewable electricity generation. Eligibility for funding requires that applicants secure off-taker agreements for at least 60% of the anticipated renewable hydrogen or hydrogen-derived fuel production.
Financial support will be provided in the form of direct grants, covering the investment costs of the approved projects. The amount of aid for each recipient will be determined through a competitive bidding process that is open, transparent, and non-discriminatory.
The Commission has validated that the Spanish initiative complies with the TCTF conditions. It emphasizes that the aid will be allocated based on a pre-defined scheme and budget, ensuring a competitive and fair process. All support under this scheme is scheduled to be awarded by December 31, 2025.
The approval of this measure is part of a broader EU strategy under the TCTF, which supports sectors pivotal to achieving a net-zero economy in line with the European Green Deal Industrial Plan. This strategy allows for enhanced investment in renewable energy, the decarbonization of industrial processes, and significant support for key technologies and materials essential for the green transition, valid until the end of 2025.
This funding initiative is a crucial step for Spain and the EU in accelerating the deployment of renewable energy solutions and reducing reliance on imported fossil fuels, thus fostering a sustainable and resilient energy landscape.
