The French government funding will be directed to HyforSeeds, a subsidiary of EDF Group’s Hynamics business, which aims to develop electrolytic hydrogen production capacity at fertiliser firm’s LAT Nitrogen’s facility in the Ottmarsheim-Chalampé.

If built, the project will use renewable and nuclear power to produce hydrogen, which will replace around 15% of the grey hydrogen used by LAT.

The direct grant will cover part of the project’s investment costs related to electrolyser construction and other infrastructure.

According to the Commission, the project could reduce the facility’s carbon dioxide emissions by over 46,000 tonnes per year.

Competitions Commissioner Teresa Ribera said the funding will promote green and low-carbon hydrogen in ammonia and fertilisers.

Replacing grey hydrogen consumption in applications like ammonia production is viewed as one of the most viable routes for clean hydrogen.

The International Energy Agency recently said “practically all” current firm offtake agreements for clean hydrogen were focused on industrial supply.

European green ammonia producers are increasingly likely to see stiff competition from foreign providers which have access to lower-cost molecules. German companies, including Uniper and RWE have both signed major offtake contracts with AM green for their ammonia project in Kakinada, India.

However, France’s nuclear power base could provide lower-cost baseload power for large-scale projects.

Earlier this week, Brussels signed off on a French subsidy scheme aiming to support up to 1GW of green and nuclear-powered hydrogen production capacity.