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EU Commission Approves €450 Million Italian Scheme to Support the Production of Renewable Hydrogen

EU Commission Approves €450 Million Italian Scheme to Support the Production of Renewable Hydrogen

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The European Commission has approved a €450 million Italian scheme to support the production of renewable hydrogen with the aim to foster the transition to a net-zero economy, in line with the Green Deal Industrial Plan. The scheme was approved under the State aid Temporary Crisis and Transition Framework, adopted by the Commission on 9 March 2023 to support measures in sectors which are key to accelerate the green transition and reduce fuel dependencies. The new Framework amends and prolongs in part the Temporary Crisis Framework, adopted on 23 March 2022 to enable Member States to support the economy in the context of the current geopolitical crisis, already amended on 20 July 2022 and on 28 October 2022.

The Italian measure

Italy notified to the Commission, under the Temporary Crisis and Transition Framework, a €450 million scheme to support investments in the integrated production of renewable hydrogen and renewable electricity in brownfield industrial areas to foster the transition to a net-zero economy.

See related article: EU Commission Offers €100 Million for Innovative Small-Scale Clean Tech Projects

The measure, financed under the Recovery and Resilience Facility (‘RRF’), will be open to companies of all sizes active in Italy with the exception of credit and other financial institutions. Under the scheme, the projects will be selected through an open competitive bidding process.

The public support will take the form of direct grants covering investment costs, with a maximum amount of aid per project of €20 million.

The Commission found that the Italian scheme is in line with the conditions set out in the Temporary Crisis and Transition Framework. In particular, (i) the aid will be granted on the basis of a scheme with an estimated volume and budget; (ii) the aid amount will be determined through an open, clear, transparent and non-discriminatory competitive bidding process; and (iii) the aid will be granted before 31 December 2025. The Commission concluded that the Italian scheme is necessary, appropriate and proportionate to accelerate the green transition and facilitate the development of certain economic activities, which are of importance for the implementation of the REPower EU Plan and the Green Deal Industrial Plan, in line with Article 107(3)(c) TFEU and the conditions set out in the Temporary Crisis and Transition Framework.

On this basis, the Commission approved the aid measure under EU State aid rules.

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