Germany launches first auction for green ammonia imports
Image by Robert Bosch GmbH. All Rights Reserved.
The German government has kicked off the first auction targeting green ammonia imports from countries outside the EU, allocating a EUR-360-million (USD 378.68m) budget for the operation.
This award process is part of the H2Global initiative which is meant to promote the production of green hydrogen and its derivatives on an industrial scale in non-EU and EFTA countries.
The Federal Ministry for Economic Affairs and Climate Action (BMWK) last December approved a budget of EUR 900 million to back investments in the production of green hydrogen that will be then imported into the EU.
As part of H2Global, the state-owned Hintco company will conclude long-term purchase agreements on behalf of the government to offtake green ammonia, green methanol and sustainable aviation fuel (SAF) at the lowest possible prices by means of an auction. In this way, investment and planning security will be ensured for producers. Hintco will also conclude short-term sales agreements with customers at the highest possible price to cater to demand across Europe.
The funding provided by BMWK will compensate for the loss resulting from the difference between the purchase price, expected to be higher, and the sale price.
Bids in the current lot of the auction are due by February 7, 2023. The winners will sign a ten-year contract with Hintco for the supply of green ammonia, with first deliveries to Germany and Europe planned for the end of 2024.
Two more lots of the auction, targeting green methanol and SAF imports, will be launched soon.
As part of the 2023 budget, Germany will provide a further EUR 3.5 billion for new auctions with terms up to 2036 as it seeks to establish H2Global as a European instrument for the ramp-up of the green hydrogen market.
Anna is a DACH expert when it comes to covering business news and spotting trends. She has also built a deep understanding of Middle Eastern markets and has helped expand Renewables Now's reach into this hot region.