Nicosia: The European Commission has approved a £780 million scheme proposed by the Netherlands to support the production of renewable hydrogen under EU State aid rules. The initiative aligns with the objectives outlined in the Clean Industrial Deal. According to Cyprus News Agency, the scheme, approved under the Clean Industrial Deal State Aid Framework (CISAF) adopted on June 25, 2025, will be implemented through a competitive bidding process expected to conclude by the first quarter of 2027.
The support will be provided as a direct grant, comprising an upfront investment grant covering up to 80% of the investment costs, along with a variable premium over a period of five to ten years. Beneficiaries are required to comply with EU criteria for producing renewable fuels of non-biological origin (RFNBOs), as detailed in the delegated acts on renewable hydrogen.
The Netherlands anticipates constructing approximately 400 megawatts of electrolysis capacity through this scheme. It is expected to stimulate the production of up to 40 kilotonnes of renewable hydrogen annually, leading to an estimated reduction of 324 kilotonnes in CO2 emissions each year. This initiative follows two prior Dutch schemes approved by the Commission in July 2023 and July 2024, which also focused on expanding electrolysis capacity in the country.
The Commission evaluated the scheme based on EU State aid rules, particularly Article 107(3)(c) of the Treaty on the Functioning of the European Union, and the Clean Industrial Deal State Aid Framework. The Commission determined that the scheme is necessary and suitable for facilitating renewable hydrogen production. It also found that the scheme has an incentive effect, limited impact on competition and trade within the EU, and brings positive effects that align with the Clean Industrial Deal objectives, outweighing any potential negative effects related to competition distortions. Consequently, the Dutch scheme received approval under EU State aid rules.
Further details on the CISAF are accessible online. A non-confidential version of the decision will be made available under case number SA.122432 in the State aid register on the Commission's competition website once any confidentiality issues are resolved.