EU’s new green energy package to pump $1.2tn in grid upgrade and new hydrogen

The European Commission launches a €1.2 trillion plan to overhaul electricity grids and scale renewable hydrogen, supported by national schemes and private sector innovations, signalling a rapid drive towards decarbonisation across Europe.

The European Commission on Wednesday launched a sweeping European Grids Package that, according to pv‑magazine India, estimates a need for about €1.2 trillion in electricity grid investments across the EU through 2040, including roughly €240 billion earmarked for hydrogen networks. The package sets out measures to strengthen cross‑border infrastructure planning, accelerate permitting, improve cost‑ and benefit‑sharing and bolster resilience and security, and the commission said it would streamline approvals for 100 hydrogen and electrolyser projects across Europe. The executive body added that support for industrial decarbonisation can be achieved “through electrification, energy efficiency, and the switch to the use of renewable and electricity‑based hydrogen, which complies with certain conditions, with expanded possibilities to support the decarbonization of industrial processes switching to hydrogen‑derived fuels.” ^[1]

The Grids Package arrives alongside a series of complementary EU actions and national initiatives designed to scale manufacturing and deployment of clean technologies. The commission has separately approved a €1.5 billion Italian state aid scheme to expand clean‑technology manufacturing capacity and to support industrial decarbonisation, a measure described by LaPresse as being approved under the Clean Industrial Deal framework and co‑financed by the Recovery and Resilience Fund. Reuters reporting on earlier Clean Industrial Deal proposals underlines wider EU intent to mobilise public and private capital, proposals that include a €100 billion push for EU clean manufacturing and mechanisms to lower the cost of long‑term renewable contracts. ^[1][4][6][7]

Italy’s regional and national moves to accelerate green hydrogen show how member states plan to use new EU levers. Umbria has issued a public notice under the “Progetto Bandiera” to attract projects for green hydrogen and biohydrogen production in brownfield industrial areas, reflecting new national guidance on permitting for co‑located PV and electrolysers. Reuters has also recorded Italy’s recent energy support schemes for power‑intensive industries, which tie discounted electricity arrangements to reinvestment in renewables, signalling a policy mix that couples subsidies with commitments to expand green power. ^[1][5][4]

Industry partnerships and pilot projects across Europe and beyond illustrate rapid technology development and diversified approaches to hydrogen production, storage and use. Fraunhofer ISE and Italy’s Green Energy Storage (GES) have begun collaboration to optimise advanced membranes for a hydrogen battery designed for long‑term electricity storage; GES said a prototype is due to be unveiled in January 2026 and that the product will enable scalable storage from a few kilowatts to tens of megawatts. Kyocera has formed a strategic tie‑up with Houston‑based Utility Global to scale manufacture of proprietary electrochemical cells, combining Utility’s ceramic‑metal cell technology with Kyocera’s advanced materials and manufacturing footprint. ^[1]

Innovations in hydrogen production and conversion are also emerging from industrial incumbents. Mitsubishi Heavy Industries reported producing 99% pure hydrogen by cracking ammonia using steam as the heating source at a pilot plant in Nagasaki, calling the result a world first for its steam‑heating approach and noting potential reductions in operating costs and opportunities for system miniaturisation because “a combustion furnace is not required.” In Taiwan, CPC Corp and Linde LienHwa inaugurated demonstration and refuelling stations intended to link government, industry and academia and to advance hydrogen mobility; Linde described the Tainan demonstration as a platform to jointly advance hydrogen applications and said CPC’s Nanzih station will enable low‑carbon hydrogen mobility. Hydrogenera has begun installing a hydrogen‑oxygen system at Volkswagen Poznań’s Września plant that operates as a non‑intrusive add‑on and mixes hydrogen with natural gas ahead of burners while introducing oxygen into the combustion‑air stream. UNIDO reported Uruguay’s launch of Kahirós, an integrated green hydrogen project backed by a public‑private partnership and a $20 million IFC loan to power hydrogen trucks for timber transport, with operations expected by late 2026. ^[1]

The Grids Package and associated national measures sit within a broader industrial policy push that includes targeted finance for semiconductor and other strategic industries. Reuters has documented recent EIB financing and state aid approvals for chip manufacturing, STMicroelectronics secured a €1 billion EIB credit line to boost R&D and high‑volume manufacturing in Italy and France, while the commission approved €623 million in German state aid for two semiconductor plants, illustrating parallel efforts to shore up supply chains and production capacity for technologies critical to the energy transition. Policymakers argue these tools, state aid, financing lines and permitting reforms, must work together to attract investment and keep European manufacturing competitive as grids and hydrogen networks are expanded. ^[2][3][6]

Taken together, the EU package, national programmes and a patchwork of private‑sector pilots point to an accelerating, multi‑track strategy: massive grid and hydrogen network investment, streamlined permitting and state support to scale manufacturing, alongside a proliferation of technical approaches from ammonia‑cracking to membrane‑based hydrogen batteries. The outlook depends on timely deployment of grid upgrades, effective allocation of EU and national funds and the ability of pilot technologies to move to commercial scale under the new regulatory and financing frameworks. ^[1][4][6]

##Reference Map:

• ^[1] (pv‑magazine India) – Paragraph 1, Paragraph 3, Paragraph 4, Paragraph 5, Paragraph 7
• ^[4] (LaPresse) – Paragraph 2, Paragraph 7
• ^[6] (Reuters) – Paragraph 2, Paragraph 7
• ^[7] (Reuters) – Paragraph 2
• ^[5] (Reuters) – Paragraph 3
• ^[2] (Reuters) – Paragraph 6
• ^[3] (Reuters) – Paragraph 6

Source: Fuse Wire Services