SSE responds to UK Government's hydrogen announcements14 Dec 2023
SSE notes today’s announcement from UK Government on contracts awarded for new low-carbon hydrogen production. While disappointed that our projects were not successful at this stage, we welcome this critical step towards a hydrogen economy. As outlined in the government’s updated hydrogen strategy, this must now be supported by the development of hydrogen transport and storage infrastructure.
Through its Net Zero Hydrogen Fund and the Hydrogen Business Model, Government articulated an ambition to support up to 250MW of green hydrogen production projects in Hydrogen Allocation Round 1, with contracts announced today for 125MW.
Following negotiations, two green hydrogen projects from SSE were not selected for support at this stage. Aldbrough Hydrogen Pathfinder, which seeks to unite hydrogen production, storage and power generation, and Gordonbush Hydrogen – which would demonstrate the value in co-locating hydrogen production with wind – will continue to be developed by SSE and will have further opportunities to seek support.
Alongside this announcement, Government has launched its Hydrogen Allocation Round 2 (HAR2), published a consultation on hydrogen to power and started market engagement for the first round of Hydrogen Transport and Storage Business Models. These are important steps in both kickstarting and establishing the framework for a low-carbon hydrogen economy.
Catherine Raw, Managing Director of SSE Thermal and Group Executive Committee lead for hydrogen, said:
“We know how crucial it is to scale up hydrogen production capacity this decade and it is encouraging to see green hydrogen projects being brought forward. While we are disappointed that we couldn’t reach agreement with Government at this stage, we remain fully committed to our projects. In particular, Aldbrough Hydrogen Pathfinder offers significant strategic benefit as it will highlight the interactions between production, storage and power generation with the learnings underpinning the development of a hydrogen economy.
“Today’s announcement also underlines the importance of HAR2 and of the need to bring forward blue hydrogen production if Government is to meet its 2030 target of producing 10GW of low-carbon hydrogen annually. Both green and blue hydrogen have a huge role to play in delivering a net zero power system and decarbonising industry, and we will continue to do our part in bringing forward world-leading projects.”
SSE has a growing portfolio of hydrogen projects across the value chain. As a company, it is exploring the potential of blending hydrogen into its existing assets including at Keadby 2. In addition, it is collaborating with Equinor on both Aldbrough Hydrogen Storage and Keadby Hydrogen Power Station. Earlier this week, SSE Thermal became joint owner of H2NorthEast, a planned blue hydrogen production facility in Teesside which it is developing with Kellas Midstream.
Alongside this, there are significant opportunities to integrate hydrogen with our offshore wind and other renewable growth ambitions, in the UK, Ireland and internationally. Additionally, it is a key focus of our early innovation projects in areas including transportation and local energy systems.