Government to launch €70M programme to support hydrogen production

Portugal’s government will launch a new programme to support the production of hydrogen and renewable gases, with an allocation of 70 million euros, under REPowerEU, the ministry of the environment said on Wednesday, without setting a date.

In a statement summarising what has been done in the area of renewable gases, the ministry of the environment and climate action noted that “a new programme will be launched under REPowerEU, with an allocation of 70 million euros”, although it did not give a date for the launch.

REPowerEU is a European Commission proposal to end Russian fossil fuel dependence before 2030 in response to Russia’s invasion of Ukraine in 2022.

The office of the minister Duarte Cordeiro also highlighted the investment support of 185 million euros from the Recovery and Resilience Programme, dedicated to supporting the production of hydrogen and renewable gases, of which 102 million were allocated in the first round, for a total of 229 million investment, in 25 new projects representing an installed capacity of 106 megawatts (MW).

The second programme – with an allocation of €83 million and whose applications ended on Monday – had a total of 49 applications, of which 39 concern green hydrogen projects, nine biomethane projects and one project provides for the production of both renewable gases.

“In total, the applications submitted are expected to add 443 MW of production capacity, corresponding to a requested funding amount of €353 million for a total investment of €906 million,” said the environment ministry.

In the revision of the Energy and Climate Plan 2030 (PNEC 2030), Portugal presented a renewed ambition in energy and climate policy until 2030, namely in the field of renewable hydrogen, leading to the revision of the National Hydrogen Strategy, to more than double the planned capacity of electrolysers by 2030, from 2.5 Gigawatts (GW) to 5.5 GW.

The government intends to launch by the end of the year the auction for the centralised purchase of biomethane and renewable hydrogen, for injection into the national gas grid auction, having ended the public consultation period on Monday.

The idea is to auction 150 Gigawatt hours per year (GWh/year) of biomethane and 120 GWh/year of renewable hydrogen, which corresponds to about 0.4% of annual natural gas consumption in Portugal.

The contract period will be 10 years and the maximum bid prices are 62 euros per Megawatt-hour (MWh) for biomethane and 127 euros per MWh for renewable hydrogen.