EU partnership to fund commercial green hydrogen projects from 2022

• Up to €820m to be unlocked to large-scale low-carbon projects
• Investments available between 2022-2026
• Investment portfolio may expand to other low-carbon innovations

LONDON (ICIS)–Green hydrogen will be among the four recipient sectors of a new investment of up to €820m between 2022-2026 under a new partnership between the European Commission and Breakthrough Energy Catalyst, the EU body announced on Wednesday.

Breakthrough Energy Catalyst is a financing vehicle under the umbrella of the Bill and Melinda Gates Foundation.

Investments are intended at fostering the creation of EU-based large-scale low-carbon technologies with the aim to reduce upfront capital expenditures, therefore paving the way for a faster energy transition.

Along with green hydrogen, other innovations are also expected to benefit from the funds.

These include:

– Sustainable aviation fuels
– Direct air capture
– Long-duration energy storage

The exact distribution of funds for each technology is yet to be indicated.
Furthermore, there are chances for the portfolio to be expanded in the future, driving investments into other high-potential technologies, such as low-carbon steel and cement, as stated by the commission.

BACKGROUND

While a previous partnership between Breakthrough Energy Catalyst and the commission took already place back in 2019, the resources allocated in the new fund would be around eight times more than the initial partnership, in line with enhanced climate ambitions.

Looking at the EU side, most of the capital will be flowing from the Horizon Program, the main EU research and innovation fund, as its third pillar consists in launching breakthrough and scalable technologies.

The rest will come via the Innovation Fund, the bloc’s funding programme specifically designed to support the deployment of low-carbon projects.

Capital raised by Breakthrough Energy Catalyst will be mainly of private and philanthropic origin.

The partnership will be implemented by the European Investment Bank and other financial bodies under the InvestEU programme framework, the latter providing an EU budget guarantee to support investment and access to finance.

NEXT STEPS

EU member states can become implementing partners via the InvestEU framework.

Interested countries will have until 30 June 2021 to reply to a call for expression of interest.

Further clarifications on the funding programme are to be expected ahead of the upcoming COP-26 conference in Glasgow in November.