The European Commission has approved Italy’s €6 billion (£5.21m) state aid to support the production of renewable hydrogen.
The aid will take the form of two-way contracts for difference, under which a strike price for hydrogen will be determined through a bidding process.
If the price of an alternative fuel that would be used by the hydrogen consumers falls below that strike price, Italy will pay hydrogen producers the difference. If the price of the counterfactual fuel exceeds the strike price, the beneficiaries will pay the difference to the Italian state.
The scheme will support the production of 200,000 tons of renewable hydrogen per year for the transport and industrial sectors.
Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition said: “This scheme will support the production of renewable hydrogen in Italy for sectors where it can contribute the most to reducing emissions. The scheme will contribute to the clean, just and competitive transition.”
The scheme will run until 31st December 2029.
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