The European Commission approved on Mar. 23 a French State aid scheme to support the production of renewable and low-carbon hydrogen, in line with the EU Hydrogen Strategy and Clean Industrial Deal.
This approval is significant as it supports France’s efforts to reduce industrial greenhouse gas emissions and contributes to broader EU goals such as decreasing dependence on Russian fossil fuels and accelerating the clean energy transition.
According to the Commission, France will introduce a program supporting up to 1 gigawatt of new hydrogen electrolysis capacity through competitive tenders. The first tender round will cover 200 megawatts with an estimated budget of €797 million. The produced hydrogen will be sold exclusively for direct industrial use, focusing on sectors where electrification is not economically viable. Aid will be granted as a fixed premium over a period of fifteen years, with beneficiaries required to comply with EU criteria for renewable fuels of non-biological origin (RFNBO) and low-carbon fuels.
The scheme aims to help France reach its target of 4.5 gigawatts of electrolyser capacity by 2030 and up to eight gigawatts by 2035. Officials expect this could avoid up to 1,100 kilotons of carbon dioxide emissions annually, helping France meet its climate commitments within the European Union.
The Commission assessed the plan under Article 107(3)(c) of the Treaty on the Functioning of the European Union (TFEU) and according to its Guidelines on State aid for climate, environment protection, and energy (CEEAG). It found that “the scheme is necessary and appropriate” for facilitating decarbonisation in industry while ensuring safeguards against undue competition distortion through open bidding processes.
Further information about this decision will be published under case number SA.101951 in the State aid register once confidentiality matters are resolved.