French government allocates €149mn for green hydrogen project in Le Havre

The French government has officially approved a grant of €149 million ($161.7mn) to Lhyfe for the establishment of a 100MW green hydrogen production facility at the industrial port of Le Havre. This decision evinces the government’s commitment to advancing green energy projects within the European Union’s framework for Important Projects of Common European Interest (IPCEIs). Such initiatives have a key role to play in funnelling state aid into energy transition efforts.

Recent IPCEI notifications have revealed a total of 200MW of electrolysis capacity earmarked for Lhyfe across France. This development indicates ongoing discussions for an additional 100MW of projects, suggesting a broader scope of state-supported green hydrogen infrastructure yet to be finalized.

Lhyfe’s press release highlights the planned operational commencement of the Le Havre green hydrogen plant by 2028. Strategically positioned adjacent to Yara’s ammonia production units, the facility aims to play a critical role in decarbonizing one of the largest fertilizer production operations in the vicinity. Although formal offtake agreements with Yara have not been concluded, ongoing discussions promise a symbiotic relationship aimed at significantly reducing carbon footprints in fertilizer manufacturing.

Notably, Lhyfe faces several hurdles before the project’s realization, including the acquisition of necessary operating and construction permits and a pending final investment decision. Furthermore, the company has yet to unveil its strategy for procuring power for the green hydrogen facility. This detail is particularly significant in light of the European Union’s impending shift in the criteria for defining “renewable” hydrogen, moving from monthly to hourly matching between hydrogen production and renewable electricity sources.

The Le Havre initiative is set to become Lhyfe’s largest venture in France to date. However, the company’s ambition on the European green hydrogen scene does not end here; plans for an even more extensive 800MW facility in Germany have been disclosed, with operational launch targeted for 2029. This project aims to integrate seamlessly into Germany’s national hydrogen pipeline network, further emphasizing Lhyfe’s commitment to leading the charge in Europe’s green hydrogen production landscape.