The Bradford Low Carbon Hydrogen (BLCH) production facility is a joint venture between Hygen and N-Gen.
Upon completion, it could deliver the decarbonisation equivalent of removing 800 diesel buses a day from West Yorkshire roads.
The facility will be situated on the Northern Gas Network (NGN) Birkshall gas storage site in Bradford.
It aims to utilise renewable energy to produce hydrogen, creating one of the largest low carbon hydrogen production centres in the UK.
The refuelling facilities will be available to businesses and other users in West Yorkshire, with the hydrogen supply to industrial users across the region managed by Ryze.
This project earned its backing from the Hydrogen Production Business Model / Net Zero Hydrogen Fund.
Jamie Burns, Director at Hygen, said: “We are delighted that this project has been selected for government funding to take it to the next phase of development.
"This project will not just produce low carbon hydrogen for Bradford and the surrounding area, but will also provide a blueprint for how complex projects like this can be delivered, boosting the hydrogen and green economies of the UK."
A climate emergency was declared by Bradford Council in 2019.
Bradford Council Leader, Cllr Susan Hinchcliffe, said: “This project is significant for Bradford’s future economic growth plans. It could be worth £900 million and create over 9,000 high-quality jobs by 2030.”
