A partnership between BP and Danish renewable energy company Orsted is set to develop zero-carbon hydrogen at an oil refinery in Germany, marking the oil giant's first full-scale foray into a sector marked for rapid growth in the near future.
Lingen refinery
BP's Lingen refinery in Lower Saxony, Germany, where the project will be based. Photo: Stefan Kunzmann
The project, which is based at the Lingen refinery in north-west Germany, will produce "green hydrogen" through the use of electrolysis of water using wind-generated power from the North Sea.
Still in its early stages, the initial aim is to construct a 50 MW electrolyser which will replace 20% of the natural gas-based hydrogen at the plant, BP said in a statement.
Production is due to begin in 2024.
There is potential for further expansion of as much as 500 MW at a later stage, which would see 100% of the fossil fuel-based hydrogen produced at the plant replaced with green hydrogen, said BP senior vice president for hydrogen, Louise Jacobsen Plutt, as reported in Reuters.
Currently, hydrogen is largely used in the industrial sector as feedstock to make fuels and other products, but the use of green hydrogen is expected to grow rapidly in the coming years and decades as governments seek to cut carbon emissions to net-zero by 2050.
BP plans to expand its hydrogen output to 10% of the market by 2030.
Green hydrogen is however more expensive to produce than natural gas-based, or grey, hydrogen and bringing down production costs will be one of the key elements for its expansion as a fuel.
“We see a path to (price) parity with grey hydrogen by the end of the decade” as more green hydrogen projects are launched and technology advances, Anders Nordstrom, Orsted vice president for hydrogen told Reuters.
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