Publication - Green Hydrogen Auctions: A Guide to Design

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Title

Green Hydrogen Auctions: A Guide to Design

Publisher

IRENA

Author

IRNEA

Published in

October 2024

Abstract

The benefits of green hydrogen go beyond reducing greenhouse gas emissions. Green hydrogen can enable green industrialisation, energy independence, increased participation in global trade and markets, and job creation. Driven by these potential benefits, policy makers are increasingly pursuing ambitious plans to support the development of green hydrogen in their jurisdictions. As of May 2024, 52 countries had a hydrogen strategy or roadmap in place, 52% of which are emerging and developing economies.

Competitive public procurement is emerging as a tool to promote green hydrogen production and use. Auctions, like all tariff-based support schemes, offer long-term revenue certainty, allow for long-term budgetary planning and enable progress in the technology learning curve.

The competitive nature of auctions can enable true price discovery, revealing feasible remuneration for producers and costs to consumers, and minimising the overall cost of public support. Auctions also provide a clear pipeline of future projects, and provide transparency in project selection and the level of support they receive. They can ensure timely delivery of what is promised in bids, and can be designed to achieve broader policy objectives for green hydrogen deployment or to address specific barriers.

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• Hydrogen

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