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European Hydrogen Bank publishes terms and conditions of renewable H2 pilot auction

Grants, Credits & Incentives Alert

The Innovation Fund pilot auction for hydrogen production is a key element of the European Hydrogen Bank, which establishes EU financing instruments and a coordination platform to cost-effectively secure domestic and international renewable hydrogen volumes in the EU.

On 30 August 2023, the European Commission announced that the pilot auction under the Innovation Fund is intended to open on 23 November 2023 and published the terms and conditions for the auction. A EUR 800 million budget will be available for bidders (project developers) in the auction.

Key terms and conditions

Admissibility, eligibility, and quality criteria

  • New electrolyser capacity of a minimum of 5 MWe (megawatt electrical) to be installed;
  • Green power, meeting strict CO2 emissions guidelines, but no requirement to install new renewable power;
  • Projects must have a very strong technical, financial, and operational capacity;
  • Projects must be linked with production located in the European Economic Area, which in practice means the EU member states, Iceland, or Norway;
  • The auctioned good is renewable fuel of non-biological origin (RFNBO) hydrogen;
  • A ceiling price for the bids of EUR 4.5 per kilogram of hydrogen produced;
  • Latest entry into operation five years after signature of the grant agreement; and
  • Completion guarantee required.

Project ranking

Qualifying proposals will have to meet the following criteria and will then be ranked from the lowest to the highest bid price :

  • Renewable electricity sourcing strategy;
  • Hydrogen off-take and price hedging strategy;
  • Electrolyser procurement strategy;
  • Environmental permits;
  • Grid connection permits;
  • Completion guarantee; and
  • Technical, financial, and operational maturity.

Funds will be awarded in that order until the available budget is exhausted.


Payments will only be made in the case of verified and certified RFNBO hydrogen production, and are scheduled every six months from the start of operations.

Next steps

If participation in the pilot auction is high, annual renewable hydrogen or hydrogen derivatives auction rounds with increased budgets will be held. A total budget of EUR 3 billion is foreseen.

How can we assist?

If you are looking for opportunities to fund your project, Deloitte Belgium’s experienced Gi³ team can provide:

  • Compliance assessment of projects against auction requirements;
  • Assistance with levelised cost calculation/analysis of H2 and strategic options for bidding price points; and
  • Full support in project outlining, detailed viability analysis, and drafting the application.

Do not hesitate to reach out to the contacts below for further information.