EU to tighten hydrogen subsidy rules after China concerns
By Kate Abnett
EINDHOVEN, The Netherlands, Sept 2 (Reuters) -The European Commission is working on tighter rules to ensure EU funding for hydrogen projects benefits European companies, after local industries raised concerns over cheap Chinese imports, the EU's head of climate change policy said on Monday.
The EU will this month launch its next round of funding for green hydrogen projects, as Brussels attempts to kick-start a local industry to produce the fuel.
Meanwhile, the EU is hardening its stance on other green technologies from China, imposing tariffs on electric vehicles which it says benefit from excessive subsidies.
European manufacturers of electrolysers, machines that use electricity to split water to produce hydrogen, have warned Brussels they cannot compete with cheaper Chinese producers.
They want the EU to protect them by adding criteria that would favour local firms to its Hydrogen Bank funding scheme, something climate commissioner Wopke Hoekstra said the bloc's executive was now working on.
"I will ensure that the next auction will be different. We will have explicit criteria to build European electrolyser supply chains," Hoekstra said in a speech at the Eindhoven University of Technology in the Netherlands.
"If European cybersecurity and safety cannot be guaranteed, if the data of our people and our companies cannot be guaranteed, companies cannot get support," Hoekstra said, adding that while Europe a good presence in electrolyser manufacturing, China is oversupplying the market at lower prices.
Hoekstra did not specify whether the rules would ban projects using foreign equipment from receiving the EU subsidies. An EU official told Reuters the criteria are still being finalised.
The EU awarded 720 million euros to seven EU hydrogen projects in April. At the time, industry sources told Reuters the low-priced bids from some successful projects indicated that they would be using cheaper Chinese equipment.
The Commission has not disclosed if this is the case.
A Commission document, seen by Reuters, showed around a quarter of the projects that bid for the funding planned to source their electrolysers from outside the EU. Nearly another quarter planned to use a mix of EU and non-EU made equipment.
Hoekstra said the EU was not aiming to cut ties with China, but would take action where it deemed competition to be unfair.
"Europe needs to counteract Chinese subsidies for electric cars that would otherwise overtake our European brands."
Reporting by Kate Abnett; Editing by Alexander Smith
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