- Norwegian energy giant Equinor has scrapped plans to produce blue hydrogen, citing high costs and insufficient demand.
- The project would have included building the world’s first offshore hydrogen pipeline.
Norwegian energy giant Equinor has scrapped plans to produce blue hydrogen in Norway, citing high costs and insufficient demand. The move will raise concerns over Equinor’s plans in the UK, which is heavily involved in several hydrogen projects.
It had pledged to generate low-carbon hydrogen from natural gas, known as blue hydrogen, in combination with carbon capture and storage (CCS) in Norway. The hydrogen produced would then be exported to hydrogen-ready power plants in Germany.
The project would have included building the world’s first offshore hydrogen pipeline. However, the ambitious scheme has now been abandoned, a huge blow to the many hydrogen proponents who see it as a mainstay of decarbonisation.
“The hydrogen pipeline hasn’t proved to be viable. That implies that hydrogen production plans are also put aside,” Equinor’s spokesman Magnus Frantzen Eidsvold noted. “We have decided to discontinue this early phase project.”
Hydrogen, which can be made from water using renewable energy, has been seen as a potential energy source as the world transitions to net zero, particularly for heavy industry and vehicles travelling long distances where recharging batteries may prove difficult.
However, concerns about the viability of producing hydrogen at scale have always dogged the industry. The problem for Equinor’s German project was that it could not find enough customers to buy the hydrogen it proposed to produce.
Mr Eidsvold said Equinor couldn’t continue maturing the projects without long-term commitments from European buyers to import hydrogen. He said, “We cannot make this kind of investment without long-term agreements and the markets in place.”
Plans to develop hydrogen-ready gas power plants in Germany with RWE will go ahead but hydrogen for those plans will be procured on the Continent, not exported from Norway. Equinor will continue other early phase hydrogen projects, such as in the UK and the Netherlands. However, the decision will raise questions about their future, too.