A New Industrial Revolution: How Europe's Hydrogen Auction is leading a Green Future

Olivia Inniss
Nov 20
3 min read

Updated: Nov 21

Author: Olivia Inniss

The European Union (EU) has officially taken a bold step toward a greener future. Committed to “reduce greenhouse gas emissions… and reach a net-zero emissions by 2050,” the EU held its first renewable hydrogen auction on November 23^rd2023. This initiative addresses the destruction caused by fossil fuels, responsible for approximately 75% of greenhouse gas emissions and 90% of carbon dioxide emissions. While our planet suffers, we are in dire need of change.

To help drive this transition, the auction secured over €694.5 million from the EU’s Innovation Fund for six projects across Spain, Portugal, Finland, and Norway. The auction promises to make renewable hydrogen economically viable.

Hydrogen- An Old Idea with New Potential

Hydrogen has always been a promising player in the realm of clean energy. When it is produced from renewable sources like wind and solar, it transforms into a clean, zero-emission fuel that could break the world’s dependence on fossil fuels.

So, why has it taken so long for hydrogen to become mainstream? The answer lies in its cost. Producing hydrogen, particularly in sectors like steel and heavy transport, has previously been more expensive than fossil fuels. The process is far from simple— it requires splitting water into hydrogen and oxygen using an electrolysis process powered by renewable energy sources. It is a powerful solution that will cut emissions in sectors that are difficult to decarbonise.

Crucially, the EU’s hydrogen auction addresses the key issue that has stalled the energy market. By offering financial support to companies that can produce hydrogen, the auction bridges the gap between production costs and market demand, unlocking hydrogen’s full potential.

Europe’s Hydrogen Revolution in Numbers

While several countries have experimented with the gas, Europe’s production efforts have set it apart. These projects are expected to produce 1.52 million tonnes of green hydrogen, preventing more than 10 million tonnes of carbon dioxide emissions—equivalent to taking about 2 million cars off the road for an entire year. This large-scale production will help drive down costs, making hydrogen more accessible.

Powerful Voices

European leaders have voiced their support. Frans Timmermans, The European Green Deal's Executive Vice-President, has been one of the most vocal advocates, emphasising “Hydrogen is crucial to achieving our climate goals.” He stresses that “we are making renewable hydrogen a reality, and Europe a leader in the green energy revolution.” These transformative words signal Europe’s ambitious commitment to leading the global energy transition.

How are businesses responding? Well-known companies, including Deloitte, Shell, and Siemens Energy, are undertaking this initiative. Industry leaders have expressed both optimism and caution about this shift. Kelly Cole, General Manager for Electric Power at Finning UK & Ireland notes "The primary hurdle lies in creating low-carbon energy solutions that are not only environmentally friendly but also financially sound." Other Industry leaders like Paul Willacy, managing director of Compact Syngas Solutions, are more confident. He believes the auction has eradicated the financial risks and will encourage investments in further projects. In fact, he wants to scale up “…securing further investment to fully commercialise on these processes.”

The Future: Europe Leads, the World Follows

This is just the beginning of Europe’s hydrogen revolution. With a second auction scheduled for December 3^rd 2024, the EU will inject another €1.2 billion into renewable hydrogen projects. Far from done, with new strategies on the horizon, Europe is setting the stage for a sustainable energy future.

But this hydrogen revolution is not confined to Europe alone. Other nations are taking note, and the race to capitalise on hydrogen’s potential is global. If we look at the UK’s Hydrogen Strategy and recent investments, it is clear Britain is set to be a prominent player in hydrogen production, committing to generating 10GW of low-carbon hydrogen by 2030.

A Call to Action

While Europe has ignited this hydrogen revolution, global action is needed. It is time to prioritise the environment before life on Mars becomes more than a backup plan! Although Europe currently leads, this transformation needs global momentum. Will the rest of the world seize this opportunity? The stakes could not be higher.