Europe’s IPCEI Project to Get €5.2 Billion Funding to Develop Hydrogen Value Chain

The IPCEI Hy2Use will see 29 companies participate in 35 projects

September 23, 2022


The European Commission has approved the second phase of the Important Project of Common European Interest (IPCEI) to support research, innovation, and the first industrial deployment of the hydrogen technology value chain in Europe.

Thirteen member states, including Austria, Belgium, Denmark, Finland, France, Greece, and Italy, have prepared a project, ‘IPCEI Hy2Use’ and will provide €5.2 billion (~$5.12 billion) in public funding, which is expected to unlock an additional €7 billion (~$7 billion) in private investments.

IPCEI Hy2Use will observe 29 companies with activities in one or more member states, including small and medium enterprises (SMEs) and startups, participating in 35 projects.

The direct participants will cooperate through numerous planned collaborations and with over 160 external partners, such as universities, research organizations, and SMEs across Europe.

The second phase of the IPCEI project will cover a wide part of the hydrogen (H2) value chain in two ways, firstly by supporting the construction of H2-related infrastructure, notably large-scale electrolyzers and transport infrastructure.

Secondly, Hy2Use will aid the development of innovative and more sustainable technologies for integrating H2 into the industrial processes of various sectors, including steel, glass, and cement, that are challenging to decarbonize.

IPCEI Hy2Use complements the first IPCEI on the hydrogen value chain— the IPCEI Hy2Tech, which the Commission approved in July this year.

While Hy2Tech focuses on end-users in the mobility sector, Hy2Use focuses on hydrogen-related infrastructure projects and hydrogen applications in the industrial sector.

The Commission said Hy2Use supports the objectives of key EU policy initiatives such as the REPowerEU Plan, European Green Deal, and EU Hydrogen Strategy. All 25 projects under the second phase of IPCEI aim to develop technologies and infrastructure that extend beyond what the EU market offers.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said, “The hydrogen value chain in Europe is in its infancy. This makes it risky for companies and the Member States to invest alone in such an innovative market. The investments approved under the Hy2Use IPCEI will allow building new electrolysis capacity of approximately 3.5 GigaWatt resulting in an output of approximately 340,000 tons of renewable and low-carbon hydrogen per year that will help decarbonising some of the most polluting sectors in Europe.”

If large projects covered under the IPCEI generate extra net revenues, the companies will return part of the aid to the respective member state.

The EU is investing €1.8 billion (~$1.804 billion) in 17 large-scale innovative clean energy projects worldwide. The projects will bring breakthrough technologies in energy-intensive industries, hydrogen, renewable energy, carbon capture, and storage infrastructure, and manufacturing key components for energy storage and renewables.