European Commission approves €134m to support German BASF in production of renewable hydrogen

LONDON(ICIS)–The European Commission has approved state aid to the German chemical company BASF in the production of renewable (low carbon) hydrogen via the EU Hydrogen Strategy and the European Green Deal targets, the commission said in a press release 3 October.

Under EU State Aid rules, a support package of €134mn to BASF “in the production of renewable hydrogen, with the aims of decarbonising its chemical production processes and of promoting hydrogen use in the transport sector.”

The decision follows previous approvals back in July and September of the IPCEI Hy2Tech and IPCEI Hy2Use policies respectively, with BASF’s project having been selected by Germany.

BASF’s low carbon hydrogen that the company produces will be mainly to replace fossil-based hydrogen in the company’s chemical production process, with excess low carbon hydrogen produced to be delivered for emerging hydrogen mobility applications such as hydrogen-powered trucks and buses.

The support, which will take the form of a direct grant, will go into the Ludwigshafen site, which is due to have an annual production capacity of 54MW and produce 5,000 tonnes/year of hydrogen and 40,000 tonnes/year of oxygen, which is expected to be operational in 2025 and be operational for a 15-year period.

The EC said that “the measure facilitates the development of an economic activity, in particular the production of renewable hydrogen. At the same time, it supports the objectives of key EU policy initiatives such as the European Green Deal, the EU Hydrogen Strategy and the REPowerEU Plan.”