1/ Green hydrogen is all the buzz right now. In my new policy brief, I take a critical look at hydrogen’s high transport costs, and what it implies for EU policies. To make costs tangible, I created the interactive model below – try it out yourself at

RT @LindnerJS: One year ago Jacques #Delors passed away. Unionist & central banker, civil servant & politician, socialist & market promoter….

and here the full paper: (end/n).

note2: most of the investments will of course be private, and the main levers are improving horizontal conditions (CMU, energy prices, etc.). But: for some of the investments to happen in the EU, they need subsidies, given market failures & foreign subsidies. (17/n).

important note: The main argument typically leveraged against national subsidies, compared to EU-level subsidies, is divergence: rich member states outspending their fiscally constraint peers. See paper for why risk seems managable for industrial policy specifically. (16/n).

➡️ the debate around national aid for industrial policy needs to become more nuanced: as long as EU-level funding isn't sufficient, national aid must be used more, but conditional on being better directed at EU priorities & aligned across member states. (15/n).

5️⃣ The Commission should incentivize use of alignment tools by making state aid approval for them faster. In some areas, it can also discourage national aid that is not well-aligned, e.g. by increasing the approval requirements regarding the efficiency of these schemes (14/n).

4️⃣ The Commission should devise some new tools, such as the state aid templates proposed in the paper and sketched above. These tools should be designed to fill gaps in the current toolbox, regarding both directing aid at EU priorities & harmonizing the subsidy mechanisms. (13/n).

However, auctions only work well if certain conditions are fulfilled. When they're not, other mechanisms are needed, such as competitive calls --> 3️⃣ COM should quickly devise "as-a-service" mechanisms for tools beyond auctions (which COM has already started working on). (12/n)

2️⃣expand the scope of existing alignment tools. Auctions, for instance, are very efficient subsidy allocation mechanisms, and the AaaS-mechanism makes them a great alignment tool. They should be offered in more policy areas, in particular for new technologies such as CCS. (11/n).

How to move forward?.The EU Commission should:.1️⃣ improve existing alignment tools. E.g. IPCEIs should incentivize harmonising processes across countries by offering faster state aid approval. Use of national funds in Joint Undertakings and InvestEU can be made easier (10/n).

Second, a new tool I propose is "state aid templates", that define the selection and disbursement mechanism, and that member states should use instead of creating individual schemes that differ from country to country. Below the alignment potential of different tools: (9/n)

AaaS were first offered for the hydrogen auction, with 🇩🇪 🇪🇸 🇱🇹 🇦🇹 channeling funds through it. Using AaaS greatly helps alignment, by ensuring national aid is focused on an EU priority, and by using the same selection & disbursement mechanism in all participating countries.(8/n).

If you don't know 'auctions as a service' (AaaS), check them out, for instance here: In a nutshell: AaaS allow member states to funnel national funds through an EU auction benefitting national projects. (7/n).

The paper discusses tools to align aid, and how to improve them, incl. IPCEIs, setting a sectoral focus in state aid rules, Joint Undertakings, or channelling funds through EU tools like InvestEU. For brevity I just go through two of them. First, 'Auctions as a service': (6/n).

Conditional on fixing these two problems, the EU can embrace national subsidies as the second-best solution. But how to fix them, i.e. how to better align national aid? (5/n).

Second, the selection and disbursement mechanisms are not harmonized across member states. Take EV purchase premiums as an example: member states use different criteria on which subsidies are based, which is inefficient and sends conflicting signals to car manufactureres. (4/n).

The main problem of current national subsidies is *lack of alignment*: First, they are not coherently directed at key EU-wide priorities, and national subsidies are at risk of being scattered, with each member state pursuing own priorities. (3/n).

EU-level funds would be the best option to finance an effective EU industrial policy (IP) -- but they are likely very scarce until the new budget arrives in 2028. National subsidies are therefore needed as a second-best solution to avoid grossly underfunded EU priorities (2/n).

Yesterday, Scholz called for subsidies in the EU for electric vehicles. Great to do industrial policy EU-wide -- but how to finance them given that EU-level funds are so tight?. ➡️ paper out today on how to better utilize *national* subsidies for EU industrial policy. 🧵 (1/n).

RT @niredeker: Sind die neuen EU-Fiskalregeln für Deutschland so restriktiv, dass sie eine Reform der Schuldenbremse überflüssig machen?. Z….