Ørsted, the prominent offshore wind developer, and Yara, said to be the world's leading fertiliser company, have joined forces to develop a pioneering project aiming at replacing fossil hydrogen with renewable hydrogen in the production of ammonia with the potential to abate more than 100 000 tonnes of carbon dioxide annually per year.
If the required public co-funding is secured and the right regulatory framework is in place, the project could be operational in 2024/2025.
Yara and Ørsted aim to develop a 100 MW wind powered electrolyser plant for renewable hydrogen production, to replace fossil-based hydrogen with renewable hydrogen for ammonia production. It is to be located in Yara's Sluiskil plant, located in the Dutch province of Zeeland. The renewable hydrogen would generate around 75 000 tons of green ammonia per year – about. 10% of the capacity of one of the ammonia plants in Sluiskil – based on dedicated renewable energy supply from Ørsted's offshore wind farms. Ørsted is about to inaugurate its Borssele 1&2 offshore wind farm, the second biggest in the world, located off the coast of Zeeland close to the Sluiskil plant.
The green ammonia is intended to be used in the production of carbon neutral fertiliser products, helping to decarbonise the food value chain, and also has potential as a future climate neutral shipping fuel.
Hydrogen produced from renewable energy sources offers a carbon-free alternative to fossil-based hydrogen, but currently comes at a significantly higher cost. Closing this cost gap takes time and will depend on public support to supplement private investments in large-scale renewable hydrogen and ammonia production. Ørsted and Yara will therefore now seek public co-funding for the development and construction of the 100 MW electrolyser facility to support the project. Subject to sufficient co-funding and a confirmed business case, a final investment decision to build the new plant could be taken late 2021 or early 2022.
"Ørsted is committed to investing in renewable hydrogen production at scale, and with the right support in place this joint flagship project between Yara and Ørsted will not only lead to a significant reduction of carbon dioxide emissions, but also help mature the technology for the wider decarbonisation of European industry", commented Martin Neubert, executive vice president and CEO of Ørsted Offshore.
The Netherlands has abundant offshore wind resources and large hydrogen consumption centres in coastal areas, so is well-positioned to lead in the green transformation of heavy industry powered by offshore wind. This project can be a milestone on the hydrogen roadmap of the Smart Delta Resources cluster in Zeeland, and an important step in the scaling of renewable hydrogen in the Netherlands towards 3-4 GW by 2030.