Dutch Cabinet Allocates €450 Million for Underground Hydrogen Storage Facility

en.Wedoany.com Reported - The Dutch cabinet has announced it will allocate €450 million (approximately $513 million) to state-owned natural gas network operator Gasunie to support the development of a large-scale underground hydrogen storage facility in Zuidwending. The allocation still requires approval from the Dutch House of Representatives.

The funds will be invested in the HyStock project, which aims to construct four underground salt caverns with a designed hydrogen storage capacity of up to 200,000 tonnes. The facility is planned to operate in parallel with existing natural gas storage facilities and connect to the Netherlands' planned national hydrogen pipeline network. The Dutch cabinet stated that this storage capacity is crucial for balancing hydrogen supply and demand and building a "well-functioning hydrogen industry chain."

The cabinet's financial support is intended to mitigate risks faced by private investors in the early stages of the hydrogen market, including uncertainty over pillow gas prices, insufficient initial storage demand, and potential permitting delays. The cabinet also clarified that the funding does not cover unforeseen construction costs or standard commercial risks, and HyStock remains responsible for the successful delivery of the project.

Gasunie has already conducted preliminary research and feasibility tests at the Zuidwending site. The company expects the first salt cavern could become operational around 2031 but has not yet made a final investment decision on the project. The timeline from planning to commissioning is estimated at 10 to 15 years, reflecting the still early stage of the Dutch hydrogen market.

The selection of Zuidwending is based on the region's existing experience with underground gas storage and convenient connections to existing infrastructure. Dutch Climate and Green Growth Minister Van Veldhoven has formally notified the House of Representatives of the cabinet's decision. The Dutch cabinet stated that this investment aims to prevent storage from becoming a weak link in the industry chain and is a concrete measure to enhance energy supply security and prepare for the country's sustainable hydrogen future.