Essar and Progressive Energy, the developer of HyNet North West, the UK’s leading industrial decarbonisation cluster, have joined forces to set up a venture to produce low carbon hydrogen at Essar’s Stanlow refinery in Ellesmere Port, Cheshire.
The joint venture will manufacture hydrogen at the refinery for use across the HyNet region. It will provide Essar Oil UK with low carbon hydrogen to decarbonise its own energy demand in addition to creating a hydrogen economy across North West England and North East Wales.
Natural gas, and fuel gases from the refinery, will be converted into low carbon hydrogen, with carbon dioxide captured and stored offshore in sub-surface reservoirs in Liverpool Bay. The hydrogen production hub will be able to deliver clean energy to industry in the HyNet low carbon cluster, as well as to fuel buses, trains and heavy goods vehicles.
It will be the UK’s first low carbon hydrogen hub, and will initially produce three TWh of hydrogen each year from 2025. This will be followed by construction of a facility twice this size giving a total capacity of over 9 TWh of hydrogen per annum. A total investment of approximately £750m will be committed to deliver the two hubs. Follow-on capacity growth is planned to reach 80% of the government’s new target of 5 GW of low carbon hydrogen for power, transport, industry and homes by 2030.
The project will use Johnson Matthey’s ‘best in class’ Low Carbon Hydrogen technology. In partnership with SNC-Lavalin, engineering is well advanced with funding provided by the UK government’s hydrogen supply competition.
Today’s agreement between Essar and Progressive Energy provides the basis to take the project through final development and into construction and operation. The project will be jointly delivered by the two companies. Progressive Energy originated the HyNet North West decarbonisation cluster, and Essar’s downstream energy activities in the area provide a natural structure for delivery.