Leipzig, 26 June 2023. The European Energy Exchange (EEX) has developed a platform for the future technical implementation of sale auctions and other trading instruments for hydrogen and its derivatives, aimed at both governmental and commercial players. EEX will provide and operate the platform on behalf of these actors.
Today, EEX signed the first LOI with Hintco a Leipzig-based subsidiary of H2Global Foundation. Under the terms of the agreement, EEX will enable Hintco to conduct auctions for hydrogen from renewable sources as well as its derivatives such as ammonia, methanol and aviation fuel. The platform will enable a competitive, transparent and non-discriminatory auction format, and facilitate the market launch of renewable hydrogen in a cost-efficient manner.
Peter Reitz, CEO of EEX, underpins the importance of this development for the exchange: „Hydrogen plays a central role in the modernisation and decarbonisation of our industries. The establishment of a trading platform is an important milestone in order to integrate hydrogen into the market. The H2Global approach is recognised within the EU, and is gaining importance also on a global scale, enabling the establishment of a liquid market with strong price signals for renewable hydrogen.“
„It’s a perfect match: We have the necessary volume of hydrogen to give a significant impulse the market ramp-up via auctions, while EEX has the know-how and expertise to guarantee the smooth execution of sell-side auctions in cooperation. Our common goal is to develop a competitive European price signal for hydrogen and its derivatives, with a global impact. The co-operation further strengthens the efficiency of the H2Global instrument,“ adds Timo Bollerhey, CEO of Hintco.
By bringing together and bundling supply and demand in standardised products with one-year delivery periods, as envisaged by the H2Global concept implemented by Hintco, transparency in the market for renewable hydrogen will not only be created but also maintained. With the support of market participants, EEX will use its decades of experience in energy trading to sustainably increase liquidity in the renewable hydrogen market. The first Hintco auctions via the EEX hydrogen platform could take place as early as the end of 2024.
The European Energy Exchange (EEX) is a leading energy exchange which builds secure, successful and sustainable commodity markets worldwide – together with its customers. As part of EEX Group, a group of companies serving international commodity markets, it offers contracts on power, natural gas and emission allowances as well as freight and agricultural products. EEX also provides registry services as well as auctions for guarantees of origin, on behalf of the French State. More information: www.eex.com
Hintco GmbH is a subsidiary of the non-profit H2Global Foundation which undertakes various initiatives to promote the timely global market ramp-up of green hydrogen and its derivatives. Hintco, a hydrogen trading company founded in Leipzig, is the implementing entity of the H2Global instrument.
Further information on the H2Global instrument
The H2Global instrument provides for the purchase and sale of renewable hydrogen or hydrogen derivatives on the basis of a competitive bidding process. In doing so, long-term purchase agreements are concluded, which offer the producers an investment security that has so far been lacking. The producers who can offer their products at the lowest price are awarded. In separate tenders, short-term sales contracts are concluded with offtakers of the products. In this case, the highest bidder will be awarded. The expected difference between the two prices offered will be offset with public funding. The competition-based character and the divergence in deadlines between purchase and sale contracts characterizes H2Global as an efficient funding instrument in dealing with the funds used compared to other funding measures.
In December 2022, the world's first H2Global tenders for the purchase of green hydrogen derivatives (green ammonia, green methanol, e-SAF) from outside Europe started. Hintco acts as a physical intermediary and trader. The Federal Ministry of Economics and Climate Protection (BMWK) is providing 900 million euros to cover the differential costs between the expected higher purchase prices and the lower sales proceeds of Hintco.
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