Hydrogen Takes Off in Netherlands, More to Follow?

Egyptian Dutch chemical giant Orascom Chemical Industries (OCI) BV announced that it will be investing together with a conglomerate made up of German utility giant RWE, British (Dutch) oil and gas major Shell, Dutch gas giant Gasunie, Norwegian oil and gas company Equinor (former Statoil) and Dutch utility Eneco, all part of the so-called NorthH2 group, in a project targeting to decarbonize OCI’s production processes and downstream value chain.

As OCI stated, the company, which is registered in the Netherlands, wants to play a pivotal role in the green hydrogen economy in the Netherlands and Europe. In its own report, OCI states that it will be using 1 GW of NortH2’s green hydrogen, which is able to reach around 4% of the Dutch 2030 Climate targets.

NorthH2’s cooperation with OCI is significant, as the latter is already a leading global producer and distributor of hydrogen-based products. The focus of the new project will be to develop and integrate the first integrated green ammonia and methanol value chains through large-scale green hydrogen supply by NortH2 to OCI’s plants in the Netherlands.

NorthH2 is setting up a large-scale offshore wind-to-hydrogen electrolysis project in the Eemshaven area, in the north-east of the Netherlands, with the support of Groningen Sea Ports.

For all parties involved the cooperation with OCI is a clear win-win situation. As ~50% of current global hydrogen production already used as a feedstock in ammonia and methanol production, the switch to green hydrogen at OCI is technologically straightforward and relatively fast when compared to other sectors. The use of around 1 GW of NortH2’s green hydrogen in OCI’s production processes is slated to take out 900,000 tons direct CO2 reduction per year.

Dutch utility Eneco stated yesterday that it will be investing heavily in offshore wind parks. Eneco’s CEO As Tempelman, said that “green hydrogen is a promising alternative for the use of natural gas in the energy and industrial sectors. The utility, as reported in its One Planet plan, wants to be climate neutral in 2035.

The utility’s position inside of NorthH2 is linked to the strategy to build up to 10GW of offshore wind capacity. The targets of NorthH2, in cooperation with Groningen Seaports, to set up by 2030 4GW of electrolyzers and wind capacity. At the same time, NorthH2 targets a production of 1 million tons of green hydrogen by 2040. Eneco only expects to need around 1.5 – 2 GW of green hydrogen.

The first steps are being set, with the backing of major international partners, able to back it up with financial capabilities. In how far the latter will be reaching full fruition is still depending on the ongoing government discussion on strategies, investment and goals.

The Dutch energy strategy has not been a very stable one the last years, looking at the coal-fired powered plants and natural gas strategies. Investors are still a bit wary of the chop-and-change approach currently taken.