Essar and Progressive Energy have joined forces to set up a joint venture for the development of low carbon hydrogen hubs in the UK.
The joint venture will manufacture hydrogen at Essar’s Stanlow Refinery in Ellesmere Port in Cheshire for use across the HyNet region, the UK’s industrial decarbonisation cluster, as well as to fuel buses, trains and heavy goods vehicles and heat homes.
It will provide Essar Oil UK with low carbon hydrogen to help decarbonise its 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 safely captured and stored offshore in sub-surface reservoirs in Liverpool Bay.
The hydrogen hub will initially produce 3TWh of hydrogen each year from 2025 and is expected to be quickly followed by a facility twice the size, giving a total capacity of more than 9TWh of hydrogen per year – equivalent to the energy used for heating across Liverpool.
A total investment of approximately £750 million will be committed to deliver the two hydrogen production hubs.
Chris Manson-Whitton, Director at Progressive Energy said: “We cannot reach net zero without decarbonising industry. Today brings a key milestone in that journey as Progressive Energy and Essar Oil UK sign a Memorandum of Understanding setting out how we will work together to deliver this exciting project at Stanlow Refinery.
“Delivering net zero requires a transformation of our energy system. HyNet offers a once-in-a-generation opportunity to create real change in energy production and consumption, creating a cleaner world for future generations. It will unlock the low carbon hydrogen economy in the North West, reducing emissions and creating and safeguarding jobs.”
Stein Ivar Bye, Chief Executive Officer, Essar Oil UK added: “Essar is committed to innovative growth as a means to create positive impact to both economy and environment. HyNet and hydrogen production is integral to Stanlow’s strategy and will set it on a journey to be the UK’s first net zero emission refinery with the ambition to avoid emissions of over two million tonnes of carbon dioxide to the atmosphere per year, the equivalent of taking nearly a million cars off the road.
“Hydrogen has a central role to play in our low carbon energy solution. We are demonstrating that the industry is committed to play its part of the UK’s transformational hydrogen strategy.”