Orsted pulls out of green hydrogen fund bid
Published 16 August 2023
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Orsted has withdrawn from the first round of the government’s green hydrogen support programme.
The Department for Energy Security and Net Zero (DESNZ) has announced that 17 projects have been invited to negotiations to secure funding through the first allocation of its Net Zero Hydrogen Fund (NZHF). The fund has been set up to provide capital support for projects to produce green hydrogen, using electrolysers.
Another three projects, which were shortlisted by DESNZ earlier this year, have withdrawn from the process.
They include the Gigastack project in the Humber estuary, led by Orsted and Phillips 66 Limited, which runs an oil refinery there.
The project was designed to use electrolysers provided by UK manufacturer ITM Power to harness electricity produced by Danish-owned Orsted’s Hornsea offshore wind farms. ITM is due to publish delayed financial results tomorrow after seeing a collapse in its share price over the past year.
The 17 projects proceeding to negotiations total 262MW of hydrogen production.
They include SSE Thermal’s project at Aldbrough in East Yorkshire, which it says boasts one what could be one of the world’s largest hydrogen storage facilities.
SSE Renewables is in talks on its project with Siemens Gamesa to co-locate a green hydrogen electrolyser and battery storage facility at its Gordonbush wind farm in the Scottish Highlands.
RES and Octopus Renewables are partnering on three projects in Scotland, Wales and the south east of England. And EDF and Scottish Power are both in talks on one project apiece, in the Tees Valley and at Whitelee in Scotland respectively.
Carlton Power is proceeding to negotiations on three projects at Barrow, Trafford and Langage in the southwest of England.
Eric Adams, hydrogen projects director at Carlton, said: “We are very pleased that our three projects in phase one of our Hydrogen development pipeline are progressing to the next stage of the process.”
The NZHF is part of the government’s efforts to achieve 1GW of green hydrogen production, either in operation or under construction by 2025.
The government said in its Energy security strategy, published last year, that it will be holding annual allocation rounds for the fund.
The successful projects from the current round are due to be announced in the final quarter of this year.
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