The document titled “Innovation Fund IF26 Hydrogen Auction: Draft Terms and Conditions” is currently undergoing consultation with stakeholders. The final auction design is scheduled to be published thereafter.
The budget is allocated between RFNBO and low-carbon hydrogen
The funding will take the form of a performance-based fixed subsidy. Projects will be evaluated based on their bid price. The subsidy will be calculated based on the requested subsidy amount, production volumes, and installed electrolysis capacity.
Approximately 350 million euros of the planned budget are earmarked for the promotion of renewable fuels of non-biological origin (RFNBO) . An additional 150 million euros are to be allocated to the production of RFNBO hydrogen and electrolytic low-carbon hydrogen .
Regulatory requirements include the supply chain and cybersecurity
As with the second and third auctions of the European Hydrogen Bank, eligibility requirements would be in place to ensure compliance with regulations governing renewable and low-carbon hydrogen. In addition, according to the draft, resilience criteria would apply to electrolyzer supply chains. For example, at least 75 percent of the electrolyzers would have to come from countries other than China.
In addition, applicants would be required to demonstrate compliance with cybersecurity regulations, state aid rules, and trade regulations. Furthermore, proof of compliance with the EU Taxonomy’s “Do No Significant Harm” (DNSH) principle would be required .
The purpose of this principle is to confirm that projects meet the DNSH’s technical screening criteria for hydrogen production throughout the entire implementation phase. To this end, applicants would be required to submit a self-declaration of compliance during the evaluation phase . In addition, a statement explaining how the project will meet the relevant environmental requirements would be required. At a later stage, upon completion of implementation, a DNSH compliance report is to be submitted.
Review: Three auctions held since 2023
The first auction of the European Hydrogen Bank began in November 2023. As part of this auction, 720 million euros in funding were awarded to seven projects in Finland, Norway, Portugal, and Spain. Bids ranged from 0.37 to 0.48 euros per kilogram of hydrogen.
The second auction, which began in December 2024, allocated 992 million euros to 15 projects. The selected projects received feed-in premiums ranging from 0.20 to 1.88 euros per kilogram.
The third auction concluded in May 2026: This time, 58 bids were received from eleven countries. Nine projects in seven countries received a total of 1.09 billion euros, with premiums ranging from 0.44 to 3.49 euros per kilogram.
