Spain’s ambition to become a key producer of green hydrogen has received a significant boost with the approval of €1.2 billion in state aid from the European Commission. This funding will support the development of renewable hydrogen production plants with a capacity of 100 megawatts or more, creating hydrogen valleys across the country.
Green hydrogen is produced using renewable electricity to split water into oxygen and hydrogen, which can be used as an energy carrier or to produce synthetic liquid fuels with a near-zero carbon footprint. The Spanish government plans to disburse the state aid through a competitive bidding system by the end of 2025, with funds coming from the EU recovery fund established in response to the Covid-19 pandemic.
The European Commission has allowed this deviation from its usual prohibition of national support for domestic industries in order to further key EU policy goals, such as the transition to a net-zero economy. Spain’s target of 11 gigawatts of electrolyser capacity for green hydrogen production by 2030 is the highest in Europe, with Germany following closely behind.
The endorsement of the Spanish support scheme by the EU has been welcomed by the trade association Hydrogen Europe, which sees Spain and the Iberian peninsula as emerging giants in the hydrogen economy. The potential appointment of Spanish Vice Prime Minister Teresa Ribera as a European commissioner for climate or energy further highlights the country’s commitment to green hydrogen production and its transition away from fossil fuels.
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