The drive for global decarbonisation has highlighted green hydrogen's potential as a versatile energy carrier. However, high production costs currently hinder market adoption and project viability, especially given the substantial upfront investment required before hydrogen becomes usable. This investment is only justifiable if hydrogen's cost can rival alternatives like natural gas, with guaranteed, plentiful supply—conditions not yet met. Therefore, incentives are crucial for launching this energy source, both by lowering immediate customer costs and boosting global production.

The expectation is that increased global hydrogen production will drive cost efficiencies. Many countries are actively incentivizing production and use to grow the hydrogen economy and ultimately achieve these efficiencies. The UK, for example, has implemented the "Hydrogen Allocation Round," a funding mechanism with two rounds completed, aiming to support approximately 1GW of hydrogen production capacity.

Germany's Federal Ministry for Economic Affairs and Climate Action (BMWK) has developed H2Global, a programme designed to foster global hydrogen economy growth.

H2Global's core involves shipping substantial quantities of pure hydrogen and hydrogen carriers (ammonia and methanol, easier to store and transport than pure hydrogen). Germany and the Netherlands will offer subsidized long-term offtake contracts, ensuring economic viability for producers worldwide.

While H2Global may not immediately increase hydrogen availability within participating countries, it ultimately contributes to their hydrogen economies. Large-scale production fosters technological advancements, expertise, and job creation. Scaling hydrogen production also stimulates growth in renewable energy sectors like wind and offshore energy, which power hydrogen production.

Understanding the H2Global mechanism

At its core, H2Global employs a ‘double auction’ model:

• Long-term procurement: Hintco, a subsidiary of the H2Global Foundation, enters into 10-year contracts with producers of renewable fuels of non-biological origin (RFNBOs), such as green ammonia and methanol.
• Short-term resale: These products are then resold through one-year contracts to buyers in Germany and the Netherlands at competitive prices.
• Public funding: The difference between the purchase and resale prices is subsidised by public funds, ensuring market stability and encouraging investment.

This structure not only mitigates financial risks for producers and consumers but also fosters a reliable market environment conducive to long-term investments.

H2Global addresses a critical bottleneck in the green hydrogen value chain: the absence of a mature, price-stable market. By providing long-term purchase agreements and offsetting price differentials, the initiative reduces investment risks and accelerates the deployment of hydrogen technologies.

Section auction round

The BMWK provided €900 million for the first round of tenders.

The second auction round was launched in February 2025, and will provide at least €2.5 billion, with contributions from the German and, to a lesser extent, by the Dutch governments.

It encompasses five lots—four regional and one global. The geographical reach and eligible products are as detailed below:

Suppliers are free to decide on their most suitable mode of transport. Projects from the regional lots need to deliver to the designated hub in Germany, while those from the global lot need to deliver to both Germany and the Netherlands. All lots require suppliers to begin delivery no later than five years after contract award.

The role of private investment

Although publicly funded, H2Global is fundamentally designed to unlock large-scale private investment:

• De-risking capital: By guaranteeing long-term offtake agreements with publicly funded price support, the scheme offers developers the revenue certainty needed to proceed with billion-euro investments in electrolysers, renewable power, and transport infrastructure.
• Infrastructure scale-up: Projects financed under H2Global often require additional private capital to build hydrogen conversion facilities, storage, shipping infrastructure, and delivery pipelines to Europe.
• Efficiency and innovation: The competitive nature of the tenders encourages private players to bring forward efficient, cost-competitive, and scalable projects—driving innovation and early mover advantage.
• Private sector off-takers: On the demand side, many of the short-term resale contracts will be awarded to private industrial consumers—from shipping and fertiliser companies to steel and chemicals—enabling them to decarbonise at scale.

In this way, H2Global functions as a strategic public-private bridge, directing public funds to lower market barriers and activate substantial private investment flows.

Navigating the H2Global application process

Understanding the application process is crucial for entities interested in participating in H2Global tenders. The process consists of the following steps:

Environmental and social safeguards are integral—projects must meet EU sustainability, emissions, and supply chain standards, and include the full logistics pathway to EU delivery points.

View from the investor market

Large-scale, commercial infrastructure projects, regardless of public support, ultimately rely on support from the private sector. It is worth considering what investors are looking for in backing these projects.

While H2Global has a truly worldwide reach, Deloitte’s recent survey of the UK investor landscape ('How to Finance the UK Energy Transition: A View from Investors (2025)', https://www.deloitte.com/uk/en/Industries/energy/perspectives/financing-the-uk-energy-transition.html ) might offer a complementary view on what is needed to secure investment.

In the survey, investors shared that:

1. 89% require a desirable return-on-investment ratio,
2. 57% look for a desirable investment size,
3. 49% want a clear visibility of risk, and
4. 49% predictable cashflows.

Initiatives such as H2Global appeal to each of these factors, making large infrastructure projects fundamentally more investable.

Final remarks

H2Global represents a transformative step toward scaling the global hydrogen economy. Its combination of public subsidy and private market participation creates a replicable model for other nations, including the UK, to bridge the commercialisation gap in green technologies.

For more information and updates on H2Global, visit the H2Global Foundation and Hintco’s tenders page. (https://www.hintco.eu/funding-tenders)