Successful first round of activities of the EU Hydrogen Mechanism to support market development, providing value added to the industry

The European Commission has successfully closed the first round of activities of the Hydrogen Mechanism operated under the EU Energy and Raw Materials Platform. Market participants currently developing hydrogen projects (on both supply and demand side) responded with high engagement, showing great appetite for this new initiative and the development of the hydrogen market.

During this first round, the Hydrogen Mechanism gave future producers of hydrogen a transparent and easy way to test demand for their specific projects and find potential offtakers, without the administrative burden of running individual processes. Suppliers responded in force: supply opportunities from 265 different projects were registered, covering renewable and low-carbon hydrogen and derivatives.

These were then presented to European offtakers, offering them the market intelligence they need to support their procurement processes and assess whether and how to enter the nascent hydrogen market. The response from the offtakers was significant: 45 offtake projects were registered, and expressions of interest were submitted for 87% of the supply opportunities.

With the matching phase complete, it is for the participants themselves to take the next step and engage directly with one another outside of the Hydrogen Mechanism to explore future collaborations.

Building on these encouraging results, the Commission is now reflecting on the next steps for the Hydrogen Mechanism, including how to support infrastructure development.

Results - Key highlights

• 265 supply opportunities were presented to offtakers
  • 87% of the suppliers have received an interest from at least 1 potential offtaker
  • 50% of the suppliers have received interests from at least 3 potential offtakers
• For derivatives, supply opportunities were connected to
  • 47 projects for renewable or low-carbon ammonia
  • 37 projects for renewable or low-carbon methanol
  • 14 projects for renewable or low-carbon e-SAF
  • 18 projects for renewable or low-carbon e-Methane
• 54% of the opportunities provided a price indication
• On the supply-side
  • Participants from 33 countries, including 16 EU countries
  • Collectively, they offered to bring their supplies to 20 EU countries
• On the demand-side
  • Offtakers requested deliveries in 10 EU countries (Belgium, Czechia, Finland, France, Germany, Hungary, Italy, Netherlands, Poland, Spain)

Background

The EU Energy and Raw Materials Platform supports European companies in securing energy products and raw materials, reinforcing competitiveness, decarbonisation, and security of supply. As a key pillar of this initiative, the Hydrogen Mechanism addresses major barriers to hydrogen market development, including

• uncertainty of demand and supply
• lack of infrastructures
• Funding challenges

By bringing together buyers and sellers in a transparent and competitive environment, the Hydrogen Mechanism stimulates market forces, enabling participants to identify and engage with potential commercial partners.

Related links

• EU Energy and Raw Materials Platform - Hydrogen Mechanism
• EU Energy and Raw Materials Platform - Energy - European Commission