BP plans to take its first steps into the burgeoning market for green hydrogen alongside the offshore wind developer Ørsted by developing a hydrogen project at one of its refineries in Germany.
The energy companies plan to create the clean-burning gas by using renewable energy, generated by Ørsted’s North Sea wind farms, to split water into hydrogen and oxygen at BP’s Lingen refinery from 2024.
The refinery will host an industrial-scale electrolyser with an initial capacity of 50 megawatts which is capable of producing enough of the green gas to replace a fifth of the refinery’s existing hydrogen demand, which currently relies on fossil fuels.
The oil company’s decision to begin producing green hydrogen, which can replace fossil-fuel gas without the carbon emissions, is an important step in its aim to become a carbon-neutral company by 2050.
BP has promised to reduce its fossil-fuel production by 40% over the next 10 years, and increase its investment in sustainable energy solutions such as renewable electricity, green hydrogen and carbon capture.
Dev Sanyal, the head of BP’s low-carbon business, said hydrogen was on course to play a growing role as the world transitions to cleaner energy sources, and BP was “determined to build a leading position in this emerging industry”.
BP will make a final investment decision on the project in 2022, depending on whether it can secure funding from the EU to support the project.
It is BP’s second major partnership designed to help the oil company gain a foothold in clean energy. BP took its first steps into the offshore wind industry in September by agreeing to buy a $1.1bn (£850m) stake in two US offshore wind projects being developed by the Norwegian state oil company Equinor, and develop future projects together too.
BP hopes to grow the Lingen hydrogen project tenfold alongside Ørsted in the coming years to produce enough green hydrogen to meet the refinery’s full hydrogen demand, and also provide feedstock for other fuels.
Martin Neubert, Ørsted’s head of offshore wind, added: “Heavy industries such as refineries use large quantities of hydrogen in their manufacturing processes. They will continue to need hydrogen, but replacing the current fossil-based hydrogen with hydrogen produced from renewable energy can help these industries dramatically lower their CO2 footprint.
“But first, renewable hydrogen has to become cost competitive with fossil-based hydrogen, and for that we need projects such as this with BP’s Lingen refinery which will demonstrate the electrolyser technology at large scale and showcase real-life application of hydrogen based on offshore wind.”