Dutch government allocates €7.5bn for hydrogen market growth

LONDON (ICIS)–The Dutch government has allocated additional funding for the development of renewable hydrogen in its latest climate budget, as announced on 26 April.

The government will allocate a total of around €7.5bn for the development of renewable hydrogen in the country, of which the bulk of the funding is dedicated to supporting hydrogen production capacity for domestic production. However, some funding has been granted via the H2Global programme, an international import scheme that secures 10-year contracts for the purchase of hydrogen internationally, for resale in the domestic market.

The bulk of the funding (€4.9bn) will be allocated to onshore electrolysis projects that have a capacity of between 500MW and 1,000MW and enter operation from 2025.

A total of €1.4bn will be made available for both capital and operational investments (CAPEX and OPEX respectively) for onshore electrolysers with a 500MW capacity, while €300m has been allocated to aid the import of renewable hydrogen into the country through H2Global.

Smaller onshore electrolysers with a capacity of 50MW have been allocated €50m, offshore electrolysers with capacities of below 100MW have been allocated €380m, and hydrogen infrastructure has been allocated €300m.

In June 2022, the Dutch government also allocated €750m for the development of the Dutch hydrogen network. Further, the budget also included support for €6.7bn for carbon capture and storage (CCS) technology.

The inclusion of CCS funding reflects the fact that key industrial areas in the Netherlands aim to utilise low-carbon hydrogen via natural gas reforming with CCS, balancing electrolysis-based production from water and electricity.

The Netherlands will use a combination of domestic production of renewable hydrogen and the importation of ammonia from other global regions via the seaborne market to meet hydrogen demand.