NortH2 the green hydrogen project

Dr Michel Ingenbleek's picture
Dr Michel Ingenbleek, Vice President Oil & Gas, Energy and Utilities, CGI
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A consortium of Gasunie, Groningen Seaports (GSP) and Shell Nederland expressed their intentions to build Europe’s largest green hydrogen project in which 3-4 gigawatt of offshore wind will be delivered in 2030 and the ambition continues to extend the project to 10 gigawatts around 2040. The green hydrogen would initially be produced in the Eemshaven-Groningen, and potentially later expand production offshore. Total production is estimated at 800.000 tonnes per year, which primarily will be delivered to industrial users in the Netherlands and further afield in northwest Europe. Mapping this across hydrogen projects and activities globally, The Netherlands are doing quite well with 92 (Brazil 46, United Kingdom, 61, according to IEA data).

Minister Wiebes (Dutch Minister of Economic Affairs and Climate Policy) and IEA director Fatih Birol recognizing the need for all low Co2 alternatives, should arguably be delighted with this announcement, considering this was a topic of debate during the IEA’s World Energy Outlook in Den Hague. The IEA identified four near term opportunities that could increase hydrogen usage and are worth reflecting in the light of the NortH2 project.

  1. GSP could thus become the nerve centre for scaling up the use of clean hydrogen. The FID for the construction of a 20-Megawatt electrolyser, to be developed by a joint undertaking between Nouryon, Gasunie and Fuel Cells and Hydrogen Joint Undertaking (FCH-JU) subsidy, ties in closely with the NortH2 project.
  2. Gasunie has a significant infrastructure of natural gas pipelines.
  3. Gasunie, Holthausen and Greenplanet expand hydrogen in transport through fleets, freight and corridors and the development of H2-filling stations
  4. GSP has the potential and location to Launch the hydrogen trade’s international shipping routes.

However, this project is ambitious and in its early stages. The first step is a feasibility study, and much of its success will depend on it.

The Hydrogen Council authored a report last month “Path to hydrogen competitiveness. A cost perspective” which suggests that scaling-up will be the biggest driver of cost reduction, notably in the production and distribution of hydrogen and the manufacturing of system components. However, to reach the scaling up stage, there is a need for investment, policy alignment, and demand creation.


For the NortH2 project, national subsidies would cover some of the cost to produce hydrogen, but European and regional subsidies, together with lower Capex, in addition to a low energy price should cover the additional cost gap. The current energy prices for wind and solar power purchase agreement (PPA) range from $53 to $153 per megawatt-hour, whilst prices around $30 per megawatt-hour would be needed for the electrolyzers to be competitive with existing hydrogen production methods according to Wood Mackenzie experts. Even if electrolyser Capex is reduced with 70-80% in the next 5-10 years, price competition of green hydrogen with blue needs to be bridged.

Regions like Chili and Australia have access to wind and solar at low LCOE, offshore wind in Europe operates at less optimal conditions. Estimates for the optimal regions suggest that the cost of hydrogen per Kilogram could reach $2.50 by 2025 and drop to $1.20 in 2030. Green hydrogen from European offshore grids could reach $2.50 per kilogram by 2030.

Much would depend on the carbon and natural gas price, but at a carbon price of $50 per ton, blue hydrogen in Europe could drop as low as $1.80 in 2030.

Perhaps the European Green Deal’s Investment Plan, the Sustainable Europe Investment Plan and additional regulation on a carbon pricing could potentially support the NortH2 project further.

All in all, the NortH2 project is a great initiative and could pave the way to a net-zero goal.

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