H2Global prepares for second auction round

A key challenge facing the burgeoning renewable hydrogen and ammonia industry is the lack of a “marketplace where supply meets demand.” H2Global, via its Contract-for-Difference mechanism, is making strides towards solving that challenge.

H2Global’s double-auction approach aims to empower the most price-competitive suppliers to produce hydrogen and derivatives, which will then be sold at the highest possible price possible through demand-side auctions. H2Global will bridge the price gap (production costs vs. purchase price) through its endowment. Following a successful pilot auction in July last year which was won by Egypt-based project Fertiglobe, H2Global has announced that its second round of auctions has now received approval – and guaranteed funding – under EU State aid rules.

EU approves €3 billion H2Global auction round

Thanks to a combined commitment of €2.5 billion from Germany’s Ministry for Economic Affairs and Climate Action and the Netherlands , H2Global’s second auction round has a total budget of up to €3 billion available for non-European producers of hydrogen and its derivatives.

Seeking a diversified source of hydrogen imports, this auction round will cover a broader geographical range than round one, with a portion of the funding distributed through regional auctions in North America, South America, Australia, Asia and Africa. The regional auctions will be “product-open,” allowing bidding for a variety of hydrogen derivatives.

The remaining portion of the funding will be distributed through a global auction (handled in Germany and the Netherlands), and will be “vector-open,” targeting molecular hydrogen exclusively. The dual approach aims to achieve both product diversity and targeted procurement.

Further details on the timeline, eligibility, and application for this auction round will be published in the first half of this year. Interested parties can register here for updates.

The second round of H2Global auctions, along with Germany’s joint commitments with the Netherlands, marks a transformative moment in building a thriving hydrogen economy. These contributions underscore the necessity of a global approach to addressing climate change and accelerating the energy transition. By fostering international partnerships and leveraging combined investments, we are setting the stage for robust supply chains and scalable hydrogen solutions that will pave the path towards the creation of green markets.

Timo Bollerhey, Hintco CEO and H2Global Co-founder, in his organisation’s official press release, 27 Dec 2024

Funding locked in for Germany’s H2Global tenders with Canada & Australia

As part of this broader regional approach, Germany’s Ministry for Economic Affairs and Climate Action has guaranteed up to €588 million for bilateral H2Global tenders with Canada and Australia for the production of hydrogen and hydrogen derivatives. This follows declarations of intent signed in 2024 by the three countries. Germany’s allocation will be complemented by Australia and Canada, leading to a total tender value of up to €1.2 billion. As part of the agreement, production will be based in the co-financing partner country, further strengthening the diversification of the global production of clean hydrogen and derivatives.

The tender processes, eligibility, and timelines will be published following EU state aid approval for each of the bilateral tenders. Interested parties are invited to register here for updates.

The initial announcement in September last year stated that the Germany – Australia joint auction would involve a €200 million contribution to the auction for each partner, with the initial auction scheduled for this year. In the Germany-Canada bilateral partnership, the Canadian government committed to allocating CAD$300 million, to be matched by the German government.

At a time of increasing uncertainty, Germany’s firm commitment to its bilateral tenders with Canada and Australia is encouraging, showcasing how governments can together leverage innovative instruments such as H2Global to tackle climate change.

Timo Bollerhey, Hintco CEO and H2Global co-founder, in his organisation’s official press release, Dec 2024

Tokyo Metropolitan Government launches hydrogen auction pilot

Building on the cooperation agreement signed in early 2024 with H2Global, the Tokyo Metropolitan Government (TMG) has launched a pilot double-sided hydrogen auction, inspired by the H2Global Contracts-for-Difference mechanism.

The two parties have engaged in mutually beneficial knowledge sharing in which TMG has learned about H2Global’s mechanism and shared information about its hydrogen trading platform. With a shared ambition to address price gaps in the hydrogen and hydrogen derivatives market, the two parties are in conversation to potentially extend their collaboration beyond knowledge exchange.

It’s fantastic to see the double auction mechanism piloted in a domestic context tailored to Japan’s needs. As we close out the year, I hope to see many more auctions inspired by the H2Global mechanism. This endorsement will drive impact and provide insights critical to scaling hydrogen markets.

Markus Exenberger, Executive Director of H2Global, in his organisation’s official press release, Dec 2024

MoU for India-Europe partnership in scaling renewable hydrogen

Lastly, H2Global Foundation and the Solar Energy Corporation of India (SECI) signed an MoU at the European Hydrogen Week in Brussels late last year. The parties have a shared vision to foster international trade corridors for renewable hydrogen and its derivatives, strengthen global collaboration, and position renewable hydrogen as a key component of a clean energy future. The two parties plan to engage in knowledge exchange on market-based mechanisms, and potentially a funding round based on production of hydrogen derivatives in India.