Copyright

Rafael Fernández; Clara García

Published On

2025-12-08

Page Range

pp. 177–190

Language

  • English

Print Length

14 pages

11. The EU Strategy for Green Hydrogen

More with Less (Public Investment)?

Chapter of: More with More: Investing in the Energy Transition: 2025 European Public Investment Outlook(pp. 177–190)
The EU’s strategy for green hydrogen (GH2) reflects an evolving institutional logic that blends regulatory and investor-state tools to address the challenges of scaling up a nascent industrial value chain. While hydrogen is central to Europe’s decarbonization agenda, its uptake is constrained by high capital costs, price risks, and uncertain demand. In response, the EU has moved beyond market design and financing mechanisms—hallmarks of the regulatory and investor states—by introducing a third layer of instruments targeting price and volume risks. Drawing parallels with the postwar development of natural gas, the chapter argues that although the EU is “doing more with less”, the scale and coordination challenges of the hydrogen transition may exceed the capacity of current instruments. Without further fiscal innovation or quasi-planning coordination, Europe risks falling short of its hydrogen targets, undermining its wider ambitions for industrial transformation and climate neutrality.

Contributors

Rafael Fernández

(author)
https://orcid.org/0000-0003-0602-4233

Rafael Fernández holds a PhD in Economics from the Complutense University of Madrid (UCM) and a degree in Political Science from UNED. He is currently a Professor at UCM’s Faculty of Economics, and serves as an independent board member of the Instituto de Crédito Oficial (ICO). His research focuses on industrial policies for the energy transition. He has directed the World Political Economy Research Group (UCM), and is a member of the Labour and Structural Transformations in Spain and the EU (LAST) Research Group, the CLACSO Energy and Sustainability Working Group, and the Self-Steering Committee for Sustainability of the UnaEuropa Alliance. Additionally, he is a Researcher at the Complutense Institute of International Studies (ICEI) and a Fellow at the Research Institute for Sustainability (RIFS). At UCM, he has held leadership roles including Vice-Dean of Research and Doctorate, Coordinator of the Master in International Economics and Development, and Coordinator of the Economics and Double Degree in Economics and Mathematics programs. He currently teaches Political Economy of Energy in the Master of International Economics at UCM and contributes to the Bachelor in Sustainability, a joint European degree.

Clara García

(author)
Professor of Political Economy at Universidad Complutense de Madrid
https://orcid.org/0000-0002-4677-6352

Clara García holds a PhD in Economics from the Complutense University of Madrid (UCM), where she is Professor of Political Economy. She has been a Visiting Researcher at the Political Economy Research Institute (University of Massachusetts-Amherst), the Center for China Studies, the Berkeley Roundtable for the International Economy, the Haas School of Business (University of California-Berkeley), and the Research Institute for Sustainability (GFZ-Potsdam). Her research examines the political economy of productive development, with a focus on energy transitions and industrial policies. She has conducted empirical studies on East Asia—especially China—and on the European Union. Dr. García’s work appears in leading journals, including Journal of Economic Policy Reform, Structural Change and Economic Dynamics, Cambridge Journal of Economics, Energy Policy, and Governance. She co-leads the Complutense University LAST research group (Labor and Structural Transformation in Spain and the EU) and serves as Editor-in-Chief of Revista de Economía Mundial. She has been Deputy Coordinator of UCM’s PhD Programme in Economics and has served as an independent board member at the Official Credit Institute (ICO). Currently, she sits on the boards of Enagás S.A. and Spain’s National Productivity Council.