May 2022, Vol. 249, No. 5
Features
Germany, Netherlands Up Ambition for North Sea Hydrogen Hubs
By Andreas Walstad, P&GJ European Correspondent
There is no shortage of ideas when it comes to exploiting the strong winds offshore Germany and the Netherlands to produce green hydrogen. Shell, Equinor, Neptune Energy and RWE are among the energy firms that plan to produce millions of tons of the clean fuel by connecting large electrolyzer plants to offshore wind farms.
Let’s be clear. All of these ambitious projects are at early stages of development. As impressive as they look on the drawing board, there are technological challenges to overcome and commercial viability to consider.
However, projects that could help displace imports of Russian gas and at the same time contribute to Europe’s climate targets now look set to receive stronger political support than ever. About 40% of gas consumption in the 27 EU countries is sourced from Russia, and many are worried about disruptions to supply in the wake of the war in Ukraine.
With the demand-supply balance on the global liquefied natural gas (LNG) market also looking tight, prices on Europe’s gas hubs have been shooting through the roof lately, meaning calls for alternative fuels are getting louder.
Another point of concern is that domestic gas production in Europe, particularly in the Netherlands, is on the decline. The large onshore Groningen field, which produced more than 1.8 Tcf (50 Bcm) only a decade ago, is expected to close later this year. As for Germany, domestic gas production is virtually non-existent. Moreover, green hydrogen does not emit CO2 during production or combustion and, therefore, would contribute to net-zero and interim emissions targets.
Besides energy security and decarbonization, another selling point is that many of the planned hydrogen projects aim to use existing pipelines and storage facilities to transport the hydrogen onshore. This should help keep down costs and make the permitting procedures less cumbersome.
Offshore wind targets are also supportive for green hydrogen. To this end, Germany’s new three-party coalition government has scaled up the 2030 target for offshore wind from 20 to 30 GW of installed capacity. The Netherlands targets 11 GW by 2030 with an interim target of 4.5 GW by 2023.
Current installed capacity is around 8 GW in Germany and about 2.5 GW in the Netherlands.
Power cables are currently used to export the electricity to the onshore main grid. The next step is to equip offshore wind farms with electrolyzers that split water into hydrogen and oxygen with the help of electricity.
RWE and Neptune Energy, for example, are planning to install a 300- to 500-MW on-sea electrolyzer in the Dutch North Sea that would use an existing gas pipeline to supply the hydrogen to industrial users. The project is known as H2opZee and has support from the Dutch government. The plan is to use an existing 10- to 12-GW gas pipeline to transport the hydrogen onshore.
A spokeswoman for Neptune Energy, Patrice Hijsterborg, told P&GJ that a study was carried out years ago, concluding the existing pipeline is suitable for hydrogen transport, or alternatively, a blend of natural gas and hydrogen. Now follow-up studies and certification are needed because “safety is everyone’s priority,” Hijsterborg said.
Pipelines Cut Costs
The fact that the transport infrastructure is already in place should reduce the lead time and costs associated with the project.
“It’s already there and you don’t need lengthy permitting processes. Also, the landing, which is already a hurdle for electricity cables, is there already so you don’t need to disturb the seabed, dunes, etc.,” she said.
According to plans, Neptune is expected to begin a feasibility study in the second quarter of 2022. If everything goes to plan, the project could be ready and start supplying hydrogen to industrial users before 2030. Neptune will not reveal the estimated cost of the project at this stage; however, it has backing from the Dutch government’s TKI Wind op Zee innovation program, which makes it eligible for subsidies.
Neptune Energy also plans to produce hydrogen from seawater at its existing Q13 oil and gas platform offshore the Hague in the Dutch North Sea. The project is called PosHYden, and the plan is to pump seawater into containerized units, a process powered by offshore wind. The water is then demineralized and fed into an electrolyzer that splits the water into hydrogen and oxygen.
The oxygen is disposed of while the hydrogen is injected into an existing gas pipeline. The repurposed gas pipeline will transport the hydrogen onshore, and then it will be distributed to industrial consumers, transport or households. The other partners in the project are state-owned EBN (40%) and TAQA Offshore (10%).
Seen in isolation, the amounts of green hydrogen produced from the Q13a-A platform will be quite limited—maximum 882 pounds (400 kilograms) per day—but the project consists of finding out more about hydrogen production from seawater, which Neptune Energy believes could be an option for its oil and gas platforms in the German and UK part of the North Sea, Hijsterborg said.
Another project to look out for in the Netherlands is NortH2, which targets 4 GW of electrolyzer capacity by 2030, with plans to scale up to 10 GW by 2040. This would equal total production of around 1 million tons of green hydrogen annually. The green hydrogen initially will be produced onshore by installing an electrolyzer plant in Eemshaven, but production could move offshore at a later stage, according to plans. The project consortium involves Shell, Equinor, Groningen Seaports, RWE and Dutch state-owned TSO Gasunie.
Plenty of Options
The consortium is investigating three options for the electrolysis plant: on a platform, similar to Neptune Energy’s PosHYden project, on a man-made island or directly in the wind turbines. It is cheaper and more efficient to transport the hydrogen to land as gas molecules rather than using heavy electricity cables, according to the project developers.
At the same time, however, offshore electrolyzers are still too expensive to make them commercially viable; this means technology costs need to come down before hydrogen production can move offshore.
As for hydrogen storage, Gasunie says it wants to repurpose empty salt caverns in Zuidwendingn. Costs of laying down the basic pipeline infrastructure with national coverage are estimated at about EUR 1.5 billion. This amount, which is not part of NortH2 but is nevertheless key for the project to go ahead, includes the costs of converting parts of the natural gas network, in particular the compressor stations, and laying some new pipelines.
The project is still at the feasibility stage.
“The feasibility study is still underway to get more clarity on relevant policy issues. We’ve seen first positive results of the feasibility study, which will be shared in due time,” says a spokesperson for RWE.
RWE is also involved in the AquaVentus project in the North Sea, which aims for 10-GW electrolyzer capacity by 2035, enough to produce 1 mtpa of green hydrogen. The other partners in AquaVentus and sub-projects include Shell, Gasunie, Siemens, Equinor, Parkwind and MHI Vestas.
The plan is to use offshore electrolyzers and transport the hydrogen via pipeline to the mainland via the island of Heligoland. More information about the next steps is expected later this year.
Another large German utility, Uniper, also has grand ambitions for green hydrogen produced by offshore wind. The company is planning to build a 1-GW electrolyzer plant at Wilhelmshaven on the North Sea coast.
A big chunk of the hydrogen may be supplied to steel maker Salzgitter, according to a preliminary agreement signed in February 2022. Uniper also has plans for an LNG import terminal at Wilhelmshaven, which could be repurposed for hydrogen/ammonia imports.
The two companies have also launched a feasibility study for pipeline transport and storage of green hydrogen from Wilhelmshaven, but there are few details available at this stage. The 756-MW coal-fired plant on the site was decommissioned in December 2021.
Although the development of hydrogen in the North Sea is at very early stages, it appears likely that geopolitical risks as well as commitments to reduce greenhouse gas (GHG) emissions will accelerate the developments.
A number of European companies, Shell, RWE and Equinor among them, have also set targets for Scope 3 or end-user emissions that appear difficult to meet without a relatively fast development of hydrogen production.
The fact that wind can harness both electricity and storable green gas is a major technological development that could seriously alter the energy landscape, although not in the short-term.
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