The European Union will proceed with plans to establish joint purchases of critical energy transition minerals and hydrogen after the successful outcome of the first ever EU Energy Platform, the Financial Times reported on Monday.
Last week, the EU declared the success of its inaugural global energy tender aimed at collectively procuring gas supplies. During the tender, the EU garnered bids from 25 different gas suppliers, totaling over 13.4 billion cubic meters (bcm) of gas.
Astonishingly, this achievement surpasses the 11.6 bcm of combined demand submitted by EU companies through the newly implemented AggregateEU mechanism.
“EU companies will now be able to negotiate the terms of the supply contracts directly with the supplying companies, with no involvement of the Commission,” the EU stated.
European Commission Vice President for Inter-institutional Relations and Foresight, Maros Sefcovic, commented, “This is a remarkable success for an instrument that did not exist some five months ago.
The Commission has played its role as aggregator and matchmaker, and now it is for the respective parties to conclude their agreements. It is a win-win for all parties.”
The EU has more than 110 companies subscribed to the so-called AggregateEU joint gas purchase mechanism and more firms subscribe every day, he noted.
The EU intends to proceed with the second phase of demand aggregation and tendering in late June with three subsequent rounds of joint gas purchases before the conclusion of this year, Sefcovic noted.
The joint gas purchase mechanism could be used as a “blueprint” for joint purchases of key critical minerals and hydrogen, he said, as quoted by FT. Companies from the Middle East have expressed interest in selling hydrogen in the EU, the Commission Vice President added.
Via a long term effort, the EU seeks to dump Russian gas supply by 2027 and diversify its supply chain of the minerals critical to the energy transition.
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Sources: www.energy.ec.europa.eu/ (2023), oilprice.com (2023), www.ft.com (2023).