German PTX Fund Supports Moroccan Green Hydrogen with Project Grants

The Power-to-X Development Fund, a German initiative, has unveiled a significant €270 million grant opportunity, inviting proposals to enhance hydrogen production in selected countries, such as Morocco. South Africa, Brazil, Egypt, Georgia, India, and Kenya are also designated beneficiaries of the grant. The funds, provided as non-repayable grants, are strategically aimed at bolstering project profitability and streamlining additional financing options.

Initiated in 2023, this program is a collaborative effort supported by the German Ministry of Economic Cooperation and Development. The application deadline for interested parties is set for March 1, at noon. Industrial projects meeting specific criteria under the program are expected to secure grants of up to €30 million euros.

Thomas Engelmann, the head of PtX, underscores the fund's commitment to projects surpassing 100 million euros, particularly crucial for industries heavily reliant on hydrogen, such as ammonia, methanol, synthetic fuels, and other chemical processes driven by renewable electricity.

The funding scope encompasses various stages of the PtX value chain, ranging from renewable energy production to distribution. This includes electrolysis, compression, storage, and hydrogen transport. Engelmann mentions that funds will be distributed across eight to ten projects over multiple submission rounds, with investments slated from 2024 to 2027.

Janne Rajpar, director of the KfW office in Rabat, expresses confidence in Morocco's preparedness to leverage these grants, citing the maturity of local projects. Florian Ziegler, also from KfW, emphasizes Germany's dedication not only to advancing green hydrogen industries in Morocco but also to facilitating skill transfers and job creation. He clarifies that while export opportunities to Europe are encouraged, they are not obligatory for funding eligibility.

Morocco has been actively welcoming investments in green hydrogen in recent years. Reports highlight the advantages of sourcing green hydrogen from Morocco, thereby emphasizing its potential for cost-effective green fuel production. As the global shift toward more sustainable practices gains momentum, there is a projected exponential increase in the demand for green hydrogen.

A 2023 report from the European Conservatives reveals substantial plans for green hydrogen and solar panel investments in Europe, particularly involving Morocco, Egypt, and Southern Africa. The European Investment Bank estimates Africa's capacity for green hydrogen production to represent a 1 trillion-euro investment opportunity. Projections anticipate the continent achieving an annual green hydrogen production capacity of 50 million tonnes by 2035, offering a highly competitive price of $2 per kilogram or less.