Germany launches second auction worth €2.5 billion for green hydrogen imports
Clean Energy Wire
The German government has started its largest green hydrogen import auction yet. For the first time, one portion of the tender worth 2.5 billion euros in total will be funded jointly by Germany and the Netherlands, said the company Hintco, a subsidiary of the business-led H2Global Foundation, which manages the contracts for the government. Pending final budget approvals, the total amount of the auction could rise to 3 billion euros, Hintco added.
H2 Global concludes long-term purchase agreements for green hydrogen and its derivatives, such as ammonia and methanol, to give hydrogen producers planning and investment security. On the other side, it concludes sales contracts in Europe. H2 Global buys the products at the lowest possible prices and then sells them on to the highest bidder. As this is expected to result in a loss of money, the government will cover the difference with subsidies.
Producers from Africa, Asia, North America, South America and Oceania can apply for funding to supply Germany with hydrogen and its derivatives.
“For the first time, this latest H2Global auction is backed by funding from two governments, proving that global cooperation in clean energy is not only possible but essential,” said Markus Exenberger, co-founder of H2Global.
In 2022, Hintco launched its first tender of 900 million euros, from which producers could apply to supply ammonia, methanol or synthetic sustainable aviation fuel (e-SAF), reported newsletter Tagesspiegel Background. As there were no bids for e-SAFs, these were not included in the second tender. As a result of the first auction, a project in Egypt was awarded with a contract for at least 259,000 tonnes of green ammonia.
Green hydrogen is set to play a crucial role in the decarbonisation of many hard-to-abate sectors, such as steelmaking and the chemical industry. Importing from regions with better potential for renewable electricity production, such as Africa, is therefore going to be key for a reliable supply.
