Hydrogen will play an important role in the EU’s transition to climate neutrality by 2050 and in its objective to become independent from Russian fossil fuels before 2030.
The EU’s 2030 targets for the consumption of renewable hydrogen in industry and transport will ensure that there is demand. However, on the supply side, only a small number of hydrogen projects have reached final investment decisions and not many producers and consumers have managed to conclude transactions. This is despite significant interest from both producers and consumers to connect.
For this reason, the EU intends to facilitate market development in advance of 2030, including by developing a pilot mechanism dedicated to the hydrogen market. The pilot mechanism will rely on an IT Platform, which is currently in development, following a call for tender to select a service provider to design and develop such a platform, which closed on 12 August 2024.
Connecting buyers and suppliers – well before 2030
The pilot hydrogen mechanism will help scale-up EU hydrogen production and market development by increasing supply and demand transparency and helping buyers and suppliers connect. It will operate under the European Hydrogen Bank.
The pilot mechanism may cover renewable and low carbon hydrogen, and derivatives. It can also enable EU buyers to connect with hydrogen supplies from outside Europe.
While it will build upon the successes of the AggregateEU platform for EU-wide gas demand pooling and joint purchases, the pilot mechanism is tailored to the hydrogen market and fully distinct in operation, governance, and user experience.
The mechanism will rely on an IT platform, ensuring a quick and easy interface while protecting the confidentiality of data collected.
Timeline
- 6 December 2024
Signing of the procurement contract
- mid-2025
The pilot mechanism platform will be launched
How will it work?
The pilot mechanism's objectives are to help suppliers and buyers connect, inform infrastructure development by identifying market needs and enhance available information on financial support.
It will engage directly with hydrogen stakeholders and perform a range of services, such as the
- collection and assessment of hydrogen demand from potential buyers and offers from suppliers
- deployment of specific matchmaking features
The pilot mechanism will also make pertinent non-commercially sensitive insights visible to the public in order to enhance market transparency and support investments; and ensure synergies with other EU initiatives and support schemes to take advantage of available data and insights.
Potential user cases
The pilot mechanism is an opportunity for potential buyers to
- find suppliers
- give visibility to their current and future hydrogen needs
- give visibility to their willingness to transition away from fossil fuels
- find cooperation opportunities
It will allow suppliers to
- find buyers
- find the project partners needed to apply for domestic auctions under the European Hydrogen Bank
- connect with financial institutions
Related links
- European Hydrogen Bank
- Press release: New pilot mechanism to boost the hydrogen market (3 June 2024)
EU Energy Platform and AggregateEU