Researchers at WU Vienna University found that EU hydrogen support could become substantially more cost-effective if policymakers prioritise installations most likely to mobilise nearby demand.
In a model based on the EU’s flagship green hydrogen programme, this approach improved policy cost-effectiveness by up to 15% and in an ideal scenario, 41%.
The EU is working for green hydrogen to supply around 10% of final energy demand by 2050, yet current policies mean that green hydrogen is almost solely supported through initiatives with no focus on demand.
The researchers state that the EU could leverage ‘spillover effects’, in which areas are more likely to adopt green hydrogen when one facility does, even without policy support. This could come from shared infrastructure, specialised supply chains and knowledge exchange between installations – none of which require extensive investment and instead, rely on natural pickup.
The paper’s lead author, Christian Rumpelnik, a researcher at the WU Vienna Institute for Data, Energy and Sustainability (IDEaS), said: “Much of the EU’s existing green hydrogen policy support focuses on scaling supply rather than demand. A hydrogen economy depends on supply, infrastructure and demand developing together. Our results suggest that policymakers should look not only at which projects require the lowest subsidy but also at where support can help unlock demand around them.”
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