Germany will tender 12.5 GW of gas-to-hydrogen capacity by year end

Germany announced it will launch its much-delayed tender to construct and modernize 12.5 GW of gas power plants that can switch to hydrogen by the end of this year or early next year.

The tenders are part of the government's efforts to transition the country towards cleaner fuels, including solar and wind energy. Germany plans to phase out coal-fired stations ahead of the official retirement date of 2038.

The government plans to issue multiple tenders. The economy ministry, which released details, said it would seek proposals to build new hydrogen-ready gas power plants in two rounds of 5 GW capacity each, as well as issue tenders for retrofitting 2 GW of old gas power plants to switch to hydrogen, 0.5 GW of long-term energy storage and 0.5 GW for fully-hydrogen-powered plants.

The tenders will be divided into two phases, and carry a deadline of eight years for the first-phase-constructed plants to switch to hydrogen --- either green or blue, the ministry said. The plants are mostly expected to come up in southern Germany, home to much of the nation's industry.

The ministry also said it would subsidize investment costs, as well as the difference in operating costs (between hydrogen and natural gas) for 800 full-load hours per year, following the plants' switch to hydrogen for fuel. Earlier this year, government sources had estimated the package --- including capital and operating subsidies --- to be worth around €16 billion.