The European Commission has released the first draft documentation for the Innovation Fund 2026 Hydrogen Auction (IF26). With a proposed budget of up to € 500 million, the fourth European hydrogen auction is expected to open towards the end of 2026. Stakeholders currently have the opportunity to comment on the draft Terms & Conditions as part of a public consultation.
For organisations planning investments in renewable hydrogen production, the publication provides an early indication of what to expect from the upcoming funding round. While the final rules have not yet been confirmed, project developers can already begin preparing for the application process.
Fourth Innovation Fund Hydrogen Auction planned for late 2026
The IF26 Hydrogen Auction continues the European Commission’s strategy of supporting renewable hydrogen deployment through the Innovation Fund. By using a competitive auction mechanism, the Commission aims to stimulate investment in large-scale electrolysis facilities and accelerate the production of renewable hydrogen across Europe.
The call is currently scheduled to launch in December 2026 and will make available up to € 500 million in funding. The budget will once again be financed through revenues generated by the EU Emissions Trading System (EU ETS).
Public consultation on draft Terms & Conditions
On 9 July 2026, the European Commission published the draft Terms & Conditions for the upcoming auction. Companies, industry organisations and other interested parties are invited to review the documents and submit feedback before 24 August 2026.
The responses received during the consultation will help shape the final version of the programme. As a result, some elements of the current draft may still change before the official launch of the call.
How does the Hydrogen Auction differ from the regular Innovation Fund calls?
Although both funding instruments fall under the Innovation Fund, their evaluation methods differ significantly. Standard Innovation Fund calls assess proposals based on multiple quality criteria, with projects ranked according to their overall performance.
The Hydrogen Auction uses a price-based bidding system instead. Applicants must submit both their project proposal and the grant amount they require, expressed as a price per kilogram of renewable hydrogen produced. Funding is awarded starting with the lowest bids, continuing until the available budget has been exhausted.
Continuing the momentum of previous hydrogen auctions
The IF26 Hydrogen Auction follows the successful IF25 round, which offered a budget of € 1.3 billion. Demand for funding was strong, and in May 2026 the European Commission announced the selection of nine projects located across seven European countries. Combined, these projects account for nearly 1.1 GW of electrolysis capacity and are expected to produce more than 1.3 million tonnes of renewable hydrogen during their first decade of operation.
Although the proposed IF26 budget is smaller than the previous round, the European Commission remains committed to supporting the further expansion of Europe’s renewable hydrogen market.
Start preparing your project early
While the final programme conditions are still under development, the consultation documents already provide valuable insight into the expected structure of the auction. Organisations working on large-scale renewable hydrogen projects are advised to monitor developments closely and begin preparing their applications well in advance.
As further details become available, including the final Terms & Conditions and the official opening of the call, timely preparation will be essential for submitting a competitive proposal.
