Europe's First Hydrogen Auction Results and the North-South Renewable Energy Divide
Key Ideas
- The EU's first European Hydrogen Bank subsidy auction had surprisingly low clearing prices, ranging from €0.37–0.48/kg of hydrogen produced.
- Winning bids were far below the auction's upper limit of €4.50/kg, indicating possible strategic bidding for a first-mover advantage.
- Five winning bids were from Spain and Portugal, while two were from Scandinavia, highlighting the competitive green hydrogen production potential in these regions.
Recent auctions in Europe have highlighted the north-south divide in renewables, but the focus shifted towards the results of the EU's first European Hydrogen Bank subsidy auction. The clearing prices at the auction were unexpectedly low, with winning bids ranging from €0.37–0.48/kg of hydrogen produced, significantly lower than the set upper limit of €4.50/kg. This low pricing raised speculation about strategic bidding by projects willing to accept financial losses in exchange for establishing dominance in the market. The geographical distribution of the winning bids, primarily from Spain, Portugal, and Scandinavia, underlined the potential for competitive green hydrogen production in these regions post-subsidy. This outcome indicates a promising future for renewable energy, particularly wind and solar, in the Middle East and North Africa, overshadowing the current north-south divide in Europe.