BAKU, Azerbaijan, June 4. The European Commission is advancing the development of the European hydrogen market by launching a pilot mechanism under the recently adopted decarbonized gases and hydrogen package, Trend reports.
According to the commission, this initiative aims to accelerate investments by providing a clearer picture of the market situation for both off-takers and suppliers and by facilitating connections between them. Set to operate for five years, this mechanism will be a part of the European Hydrogen Bank.
The hydrogen pilot mechanism will collect, process, and provide access to information on the demand and supply of renewable and low-carbon hydrogen and its derivatives, enabling European off-takers to connect with both European and international suppliers. It will gather market data on hydrogen flows and prices. A procurement process has begun to find a service provider to develop an IT platform for the pilot mechanism, with a contract expected to be signed by the end of this year, allowing operations to begin by mid-2025.
Across Europe, the first large-scale electrolyzers are already under construction, and the initial off-take agreements have been signed. Enhancing demand visibility between suppliers and consumers will help accelerate final investment decisions and secure off-take agreements. Hydrogen will play a crucial role in achieving our Green Deal targets, phasing out Russian fossil fuels, and supporting the decarbonization and competitiveness of European industry.
The pilot hydrogen mechanism is part of the commission's broader efforts to establish a European Multiproduct Platform for the joint purchase of strategic commodities, which may eventually include strategic raw materials.
Meanwhile, the commission has established the European Hydrogen Bank to boost investments in hydrogen projects and facilitate the development of a complete hydrogen value chain in Europe. The first domestic auction was a success, attracting 132 proposals, with seven projects selected to receive nearly 720 million euros in financial support from the Innovation Fund. The commission plans to launch a second domestic auction by the end of this year and is collaborating with member states to develop potential international auctions.