Associate Partner
European Graduate Administrative Manager
Strong Competition Again – An Assessment of the Results of the Second Hydrogen Auction Under the Innovation Fund
After the first auction round already demonstrated significant interest in funding renewable hydrogen production projects, the second round confirms this picture – with even stronger competition, high participation, and once again substantial underbidding of the maximum permissible price.
The Innovation Fund is one of the world’s largest funding instruments for low-carbon and innovative technologies. It is financed from revenues of the EU Emissions Trading System (EU ETS) and is expected to provide approximately €40 billion1 between 2020 and 2030, depending on the carbon price.
How the Hydrogen Auction Works
To specifically promote the market ramp-up of renewable hydrogen, the European Commission has introduced an auction mechanism within the Innovation Fund. This instrument is part of the “domestic leg” of the European Hydrogen Bank. The European Hydrogen Bank acts as a coordination and financing platform to ensure Europe’s supply of cost-effective, renewable hydrogen.
The auction mechanism follows a “pay-as-bid” model with a fixed premium. Project developers submit bids stating the level of funding they require per kilogram of renewable hydrogen produced – precisely the amount that closes the gap between actual production costs and the price achievable on the market. The projects with the lowest bids receive funding until the allocated budget is exhausted.
Results of the Second Auction Round
On February 20, 2025, the second auction round (IF24 Auction) was completed. A total of €1.2 billion in funding was available, including for the first time a dedicated budget of €200 million for projects with off-takers in the maritime sector2.
By the deadline, 61 bids were received from eleven countries, eight of which were for the maritime sector. Applicants requested a total of approximately €4.88 billion, underscoring the growing interest and increasing competition in the hydrogen sector.
On May 20, 2025, the European Commission published the results: 15 projects from five countries were selected for funding and will receive a total of €992 million.
| Project Name | Coordinator | Country | Bid Volume (kt H2 / 10 years) | Electrolysis Capacity (MW) | Expected GHG Reduction (kt CO2e / 10 years) | Bid Price (EUR / kg) |
| no off-taker restrictions | ||||||
| VILLAMARTI N H2 | GALENA RENOVABLES 6, S.L. | Spain | 126 | 252 | 895 | 0,20 |
| PUERTO SERRANO H2 | GALENA RENOVABLES 7, S.L. | Spain | 49 | 98 | 337 | 0,25 |
| Kristinestad PtX | Koppö Energia Oy | Finland | 258 | 200 | 1.763 | 0,33 |
| SolWinHy Cadiz | Viridi RE GmbH | Spain | 63 | 80 | 431 | 0,40 |
| H2LZ | IGNIS HIDROGENO ALFA | Spain | 26 | 20 | 179 | 0,41 |
| AGS | ARMONIA GREEN SEVILLA | Spain | 238 | 198 | 1.631 | 0,41 |
| AGG280 | ARMONIA GREEN GALICIA, S.L. | Spain | 238 | 198 | 1.629 | 0,42 |
| H2CRI | GREEN DEVCO ENERGY 6, S.L.U. | Spain | 30 | 30 | 204 | 0,44 |
| KASKADE | Meridiam SAS | Germany | 354 | 367,5 | 2.424 | 0,45 |
| H2-Hub Lubmin | H2-Hub Lubmin GmbH | Germany | 238 | 210 | 1.628 | 0,47 |
| TORDESILLASH2 | Elawan Energy | Spain | 17 | 15 | 115 | 0,48 |
| Zeevonk Electrolyser | Zeevonk Electrolyser | Netherlands | 411 | 560 | 2.812 | 0,60 |
| Off-takers in the Maritime Sector | ||||||
| RjukanH2 | NORWEGIAN HYDROGEN AS | Norway | 29 | 18,75 | 201 | 0,45 |
| Gen2-LH2 | Gen2 Energy AS | Norway | 104 | 82,21 | 714 | 0,59 |
| HammerfestH2 | GREEN H AS | Norway | 12 | 7,5 | 80 | 1,88 |
Table 1: Results of second auction round, Source: IF24 Auction – European Commission
All funded projects must reach Financial Close within 2.5 years of contract signing and begin hydrogen production no later than five years thereafter. In addition, they receive their fixed premium only after the hydrogen has been certified and verified as “RFNBO hydrogen” (renewable fuel of non-biological origin – RFNBO).
Comparison and Assessment of Results from First and Second Auction Rounds (excluding projects with maritime sector off-takers)
| IF23 Auction | IF24 Auction | |
| Maximum Permissible Price | €4.5/kg | €4/kg |
| Average Award Value | €0.44/kg | €0.41/kg |
| Highest Award Value | €0.48/kg | €0.6/kg |
| Lowest Award Value | €0.37/kg | €0.2/kg |
Table 2: Comparison of the first two auction rounds (excluding projects with maritime sector off-takers, as separate funds were available for these), Source: European Hydrogen Bank auction provides €720 million and IF24 Auction – European Commission
Compared to the first auction round , a highly competitive environment continues to be evident. Although the maximum permissible price was reduced from €4.50/kg to €4.00/kg, the average award value at €0.41/kg was once again significantly lower. The lowest bid price was even just €0.20/kg. As in the first round, the high concentration of awarded projects in Spain is also notable.
The results of both auctions thus demonstrate that renewable hydrogen can already be produced today at prices close to competitive market rates in certain regions of the European Economic Area, provided access to affordable renewable energy is secured, clear regulatory frameworks exist, and guaranteed off-take is in place.
Upcoming New Auction Round in 2025
As announced in the Clean Industrial Deal, there will be another auction round for renewable hydrogen by the end of 2025, with a funding volume of up to €1 billion (Source: Competitive bidding – European Commission). We will keep you informed.
We are happy to support you with regulatory and economic questions relating to hydrogen.
Are you interested in public funding? We will show you the way and accompany you from project concept to proof of use.
Sources and notes:
1 Based on an assumed price of €75 per tonne of CO2.
2 An off-taker is considered active in the maritime sector if it uses the hydrogen produced under the project, or a corresponding derivative, to conduct or utilize bunkering activities in ports within the EU/EEA. Bunkering includes the supply of energy sources for ship propulsion or onboard power supply.
Competitive bidding – European Commission
Calls for proposals – European Commission
What is the Innovation Fund? – European Commission
IF24 Auction – European Commission
Press corner | European Commission
First Hydrogen Auction Under the Innovation Fund Starts on November 23, 2023 | RÖDL
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