As Germany navigates the power transition whereas phasing out coal, the state of Saxony-Anhalt has launched a €87 million inexperienced hydrogen subsidy program, designed to catalyze industrial decarbonisation in one of many nation’s most coal-reliant areas.
Financed by the EU’s Simply Transition Fund (JTF), the initiative goals to repurpose legacy power property and assist the hydrogen uptake throughout heavy business.
The funding is cut up throughout two mechanisms: €58 million is devoted to the “Inexperienced Hydrogen: Electrolyzers” program, concentrating on the deployment of hydrogen manufacturing and storage infrastructure. The second pot, price €29 million, is obtainable by the “Saxony-Anhalt Future Energies/Inexperienced Hydrogen” scheme, supporting broader functions and integration efforts.
Saxony-Anhalt’s determination to focus on former open-cast coal mine websites and adjoining industrial services displays a strategic try to overlay hydrogen infrastructure onto current power corridors. That is in keeping with broader German federal methods to make use of hydrogen as a decarbonization lever in hard-to-abate sectors.
The deal with industrial functions is express. In keeping with the state authorities, eligible bidders should exhibit how the inexperienced hydrogen produced might be built-in into energy-intensive sectors, significantly chemical manufacturing—an business with deep roots within the area. Firms working on this area, reminiscent of these throughout the Leuna chemical park, are already positioned to soak up and make the most of hydrogen at scale, supplied the availability turns into dependable and cost-competitive.
The timing of Saxony-Anhalt’s funding launch is essential. Germany’s nationwide hydrogen technique continues to face implementation bottlenecks, with business stakeholders citing excessive capital prices and inadequate offtake certainty as key obstacles to deployment. By frontloading capital by way of grants—slightly than relying solely on Contracts for Distinction or carbon value indicators—the state goals to shut the viability hole for early-stage electrolyzer initiatives.
Particularly, subsidizing electrolyzer capability might assist cut back Germany’s reliance on imported hydrogen by enabling decentralized manufacturing nearer to finish customers. This regionalized mannequin gives logistical and financial benefits, particularly when built-in with renewable technology property already related to former coal areas.
Saxony-Anhalt’s program comes amid rising uncertainty on the federal degree. The German authorities’s revised draft price range for 2025—at the moment underneath negotiation—proposes vital cuts to nationwide hydrogen funding, together with a possible €2.5 billion discount in industrial decarbonization contracts. On this context, EU Simply Transition funds symbolize a essential buffer for coal areas like Saxony-Anhalt to maintain hydrogen growth momentum.
Whereas the EU’s JTF was designed to mitigate the social and financial impacts of coal phase-out, Saxony-Anhalt’s allocation towards hydrogen suggests a proactive industrial technique. Fairly than merely subsidizing financial transition, the state is searching for to anchor future development in inexperienced applied sciences aligned with international local weather commitments and EU power safety targets.
The tender mannequin indicators that funding is not going to be awarded indiscriminately. Candidates might want to exhibit technical feasibility, co-financing buildings, and alignment with local weather and industrial targets. The deal with built-in worth chains—from manufacturing to storage and finish use—mirrors greatest practices rising throughout Europe for hydrogen challenge analysis.
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