SSE Thermal Acquires 50% Stake In H2NorthEast Hydrogen Project
The title of this post is the same as that of this press release from SSE Thermal.
These are the first three introductory paragraphs.
SSE Thermal has become joint owner of a blue hydrogen project in Teesside which is set to play a major role in supporting a reliable decarbonised power system by 2035 and accelerating industrial decarbonisation.
The partnership with Kellas Midstream will see the companies jointly develop H2NorthEast, a hydrogen production facility with carbon capture and storage that could help to kickstart a hydrogen economy in the Tees Valley. The agreement is for an initial consideration of <£10m to Kellas Midstream with further contingent consideration due should the project reach a financial investment decision.
In its first phase, H2NorthEast could deliver up to 355MW of blue hydrogen production capacity from 2028 with plans to scale up to more than 1GW. Offtakers would include heavy industry and power generation, either through blending into existing assets or in new hydrogen-fired plants.
Note.
- Production of 355 MW of hydrogen could start in 2028.
- Several existing processes have been converted from gas-firing to hydrogen-firing or a blend of natural gas and hydrogen firing. See Lime Kiln Fuelled By Hydrogen Shown To Be Viable.
- Teesside has quite a few industries, like steel and chemicals that theoretically could be converted to hydrogen or a hydrogen blend.
I have some thoughts.
Carbon Capture And Storage
This paragraph in the press release talks about the carbon capture and storage.
With an anticipated minimum carbon capture rate of 97%, H2NorthEast meets both UK and EU low-carbon standards. Specifically, the hydrogen produced via H2NorthEast would be fully compliant with both the UK’s Low Carbon Hydrogen Standard and is expected to be aligned with the EU Taxonomy for sustainable activities.
If the plant can achieve a carbon capture rate of 97 %, that is very good and it appears to meet the required standards.
- I also feel, that if it is of a high purity, then that could be a bonus, as it could be used in food manufacturing and other processes, where high purity is needed.
- I feel SSE should endeavour to use as much of the carbon dioxide, as it can to produce valuable by-products, which could include cement substitutes, building blocks, plasterboard and animal feed.
- Carbon dioxide can also be fed to soft fruit, salad vegetables, tomatoes, flowers and other plants in giant greenhouses or vertical farms.
- Polyester yarn can also be made from carbon dioxide.
It is my belief that this list of products will grow in the next ten years and carbon dioxide of a high purity will become an important chemical feedstock.
Replacement of Blue Hydrogen With Green
If SSE Renewables were to build an electrolyser near to H2NorthEast, they could use that to replace the blue hydrogen.
- From an offtaker’s point of view green and blue hydrogen would be identical.
- It’s just that the green hydrogen doesn’t produce any carbon dioxide.
- I can see the complex being run to produce enough carbon dioxide to supply the users that need it and producing blue and/or green hydrogen accordingly.
Hopefully, the more uses that can be found for the carbon dioxide, the less of it will need to use long-term storage.
Expanding The Plant
As blue and green hydrogen plants create an identical product, the decision of whether to add an extra blue hydrogen or green hydrogen plant can be taken solely on financial grounds.
Conclusion
This looks like it could be a very sensible decision by SSE.
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