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Package for the future – Hydrogen Strategy

Source: IEA/IRENA Renewables Policies Database
Last updated: 15 October 2021

The German recovery plan intends to expand the role of hydrogen to decrease national dependence to coal.      


EUR 7 billion of public investments have been ear-marked in the budget for Green Hydrogen, including the following milestones:


- Germany plans to build a production capacity of 5 GW by 2030. Additional 5 GW will be built by 2035-2040.   

- Hydrogen production will be done through tenders for electrolysis services, subsidies for building new plants, and new pilot programmes.   

- Green hydrogen production will be exempt from the EEG levy.  

- Hydrogen will be promoted in the industrial sector in order to reduce the use of fossil fuels in industrial processes (ex: to produce climate-friendly steel).  

- Germany will also promote the direct use of green hydrogen in aircraft engines, and encourages the development of concepts for hybrid electric flying (combination of hydrogen / fuel cells / battery technology).      


The Hydrogen Strategy also includes EUR 2 billion for international partnerships. It will thus establish foreign trade partnerships with countries with more favourable production conditions for green hydrogen, to build large production plants with German technologies. 31 potential partner countries (mainly located in West and South Africa) are concerned. A share of the hydrogen produced will then be exported to Germany. It will encourage partner economies to be less dependent on fossil fuels, while helping Germany meet its hydrogen demand.


The Minister for the Environment, Nature Conservation and Nuclear Safety delivered a statement of intent on September 2021 on funding of 55 million EUR for hydrogen-based steel production. The ArcelorMittal H2H project with its total investment of more than 110 million euros will implement a low-carbon, hydrogen-based steel production process on an industrial scale. To this end, the company will build a hydrogen-powered DRI plant at the existing site in Hamburg.


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