The UK oil and gas major BP unveiled plans to build its largest green hydrogen production facility in the Northeast of England. The company said it would start with an initial 60MW of electrolyzer capacity that could grow to half a gigawatt by the end of the decade.
The initial 60MW green hydrogen plant is aimed to be completed by 2025 and represents the first step in the so-called HyGreen Teesside project. The project could grow in stages that “match production to demand” to 500MW of electrolysis by 2030. The planned 60MW would be able to fuel about 1,300 large trucks that currently rely on diesel.
The capacity of 500MW is adding to the currently planned 1GW blue hydrogen capacity – produced from natural gas with carbon capture – under the already announced H2Teesside initiative. The H2Teesside project is BP’s world-scale hydrogen production plan that aims to make 1GW of CCUS-enabled blue hydrogen, expected to come online in 2027.
H2Teesside and HyGreen are part of a major push to turn the Northeast region into the UK’s first integrated hydrogen hub and a major source of the fuel for heavy industry. According to BP, the two projects could account for 30% of the UK government’s 5GW 2030 target for hydrogen production.
The company also commented that it forecasts a significant customer base that will only want to buy the green variety of hydrogen, even though the color of the supply would likely be secondary “for the vast majority of customers”. “There will always be specific customers that for whatever reason want to purchase a particular type of hydrogen,” said Matt Williamson, a vice president for hydrogen at BP.
Regarding price, BP sees green hydrogen produced at HyGreen starting off pricier than the blue type, saying the beginning of the establishment of green hydrogen production in the country needs to start from somewhere. “Sixty megawatts is to a company the size of BP a small enough chunk to start with but big enough to make a difference…We know electrolyzer costs and renewables power costs will come down,” added Williamson.
The oil major expects to make the final investment decision on the first phase of HyGreen by 2023, but like others advancing hydrogen projects in the UK, it is also waiting to see what support will be available from the government.