Europe grants France €4 billion in state aid to support renewable energy sources and industry | Decarbonization

Companies are encouraged to adapt their industrial processes

Companies are encouraged to adapt their industrial processes

The European Commission has approved €4 billion in state aid for France to decarbonize its industry and support its transition to a Net Zero economy.

Margrethe Vestager, executive vice-president in charge of competition policy, said this would be an incentive for companies to adapt their industrial processes by using less polluting and less energy-consuming equipment, contributing to meeting the EU’s climate goals.

Under the temporary crisis and transition framework, Member States may establish investment programs in all renewable energy sources, including renewable hydrogen, biogas and biomethane.

They can also use investments to phase out fossil fuels through electrification, energy efficiency and the transition to renewable and electricity-based hydrogen, and support the decarbonization of industrial processes through the transition to hydrogen-based fuels.

Funding is also available for electrolysers and carbon capture and storage (CCUS), as well as for the production of key components and the recycling of related critical raw materials.

According to the IEA, France has a very low-carbon energy mix thanks to a large nuclear fleet, the second largest after the United States.

As an early leader in setting an ambitious energy transition, France adopted a net zero emissions target for 2050 in its 2019 Energy and Climate Act and aims to reduce greenhouse gas emissions by 55% by 2030.

The national low-emission strategy with five-year carbon budgets and a multi-year energy investment plan pursue the long-term goal.

France intends to support hydrogen with public investments worth €7.2 billion and reach 6.5 GW of electrolyzer capacity by 2030.

EDF Group company Hynamics recently inaugurated its second renewable hydrogen production and distribution station in Belfort, which can produce 400 kg of green hydrogen per day.

Lhyfe and Ugitech recently signed a memorandum of understanding for a green hydrogen production unit at the Ugitech plant in Ugine (Savoie) to help decarbonize the steelmaker’s industrial operations. Lhyfe says this is the first agreement in Europe to replace fossil fuels with green hydrogen in the stainless steel sector.

TotalEnergys and ENGIE have joined forces to build the largest green hydrogen production plant in France. The Masshylia project, located at the TotalEnergys biorefinery in La Mède, will be powered by energy from photovoltaic farms, and its electrolyzer will produce five tons of green hydrogen per day from this year.