Renewable

December 30 (Renewables Now) - Germany's Ministry of Economic Affairs and Climate Action has given the green light to a EUR-900-million (USD 1.01bn) project to back investments in the production of green hydrogen in countries outside the EU that will be then imported into the union.

The H2Global initiative is designed to work as an auction-based mechanism to promote the production of green hydrogen and its derivatives, such as ammonia, methanol, and sustainable aviation fuel on an industrial scale in non-EU countries.

The scheme will help ramp up the hydrogen economy on an international level and build long-term value and supply chains as Germany will need to import green hydrogen, said economy minister Robert Habeck.

The state aid was unconditionally approved by the European Commission (EC) earlier in December and the first off-take contracts are expected to be signed in 2022 with deliveries to Germany and Europe planned to start in 2024.

As part of the H2Global project, Germany will buy green hydrogen or its derivatives in countries outside the EU at the lowest possible price through 10-year contracts. The fuel will be then sold to companies in the union through short-term contracts at the highest possible price. The state aid will compensate for the loss resulting from the difference between supply and demand prices for ten years.

(EUR 1 = USD 1.130)