Offshore sector mobilizing to support UK hydrogen targets

June 1, 2022
Focus on lowering cost, repurposing infrastructure.



GAS SUPPLY CONCERNS are driving increased support for development of hydrogen as an alternative energy sources. In Britain, multiple initiatives are under way to develop green and blue hydrogen at planned 'energy hubs,' some connected to local offshore wind farms.

The government aims to have up to 10 GW low-carbon hydrogen production capacity in place throughout the UK by 2030. Earlier this year the Department of Business, Energy & Industrial Strategy (BEIS) announced a £240-million ($293-million) Net Zero Hydrogen Fund for low-carbon hydrogen projects. The BEIS has since offered additional support for projects switching from industrial fuel to hydrogen, via its £26-million ($31.8-million) Industrial Hydrogen Accelerator.

According to the Aberdeen-based Net Zero Technology Centre’s (NZTC) Integrated Energy Vision report, by 2050 the UK could require up to 253 TWh of green hydrogen to satisfy 85% of domestic gas needs. And if 50% of this hydrogen (green) is to be generated using electricity from floating offshore wind, over 30 1-GW scale projects would have to be constructed, the Centre claims, at a total cost of £170 billion ($208 billion).  However, another recent NZTC report, covering the outlook for Floating Offshore Wind Powered Hydrogen, notes that the price of floating wind in UK waters would need to halve from current levels to £40/MWh ($49/MWh) by 2050, in order to match the price of fixed offshore wind power. That in turn would make green hydrogen more affordable, as electricity accounts for up to 70% of the production cost.

But to achieve the Government’s target of a £70/MWh ($85/MWh) levelized cost of hydrogen from offshore renewable energy by 2050, further cost reductions would be needed to the hydrogen production process, the floating offshore wind report concluded, along with improvements in electrolyzer efficiency. These reductions can only be achieved through investment in emerging technologies such as green hydrogen electrolyzers and hydrogen compression.     


NZTC, formed originally in 2017 as the Oil & Gas Technology Centre, is pursuing co-development of `net zero’ technologies with industry, facilitating testing and field deployments of innovations in wind power, Carbon Capture Utilization and Storage (CCUS), hydrogen and other renewable power sources. It provides support to start-ups in these fields, partly via its Tech X Clean Energy Accelerator program. NZTC draws on £180 million ($220 million) of funding provided by the UK and Scottish governments and the Aberdeen City Region Deal, with smaller-scale funding supplied by Scottish Enterprise, the Scottish Funding Council and the Scottish government for research conducted at Scottish universities and technical institutes. In addition, it directs funds made available by BEIS and H2020 for consortia deploying projects in the late development phase.

In April 2020, the Centre opened its Net Zero R&D Programme: following a `Call for Ideas’, various low Technology Readiness Level (TRL) projects are under way. The focus includes hydrogen innovation, optimizing blue hydrogen production, hydrogen transportation, and long-term hydrogen storage. Among ongoing developments are:

  • McAlpha, Canada: Re-use of subsea natural gas pipeline infrastructure for bulk hydrogen
  • 12 TO ZERO, Rotterdam: Hyfloat floating hydrogen production and storage system
  • CB&I UK (McDermott): Enhanced digital twin framework, including fatigue damage and hydrogen embrittlement models for transporting hydrogen in natural gas steel pipelines
  • Fairfield Energy/Batigea, UK: Storage of hydrogen and carbon-dioxide in UKCS near-abandonment depleted hydrocarbon reservoirs and aquifers
  • Centrica Storage: Redevelopment of the Rough gas reservoir in the UK southern North Sea for hydrogen storage
  • BW Offshore (UK) and Xodus Group: Alternative to Haber-Bosch for production of offshore ammonia
  • Marine Direct Consultants: Re-purposing pipelines for hydrogen transportation
  • Actuation Lab: Use of magnetic couplings to eliminate the hazard of leaking hydrogen valve stems.     

This spring, NZTC also launched the first phase of its 2022 Open Innovation Programme, offering funding of up to £7 million ($8.6 million), with seven technology focus areas, one of which is hydrogen/clean fuel technologies. Priorities include improved electrolysis and reducing the cost of levelized hydrogen, with technologies sought that deliver efficiency or performance improvements over existing electrolysis techniques. The second-phase of funding, scheduled to open in October, will be offered to technology developers and academia. Here the target is mid-high TRL projects, with an obligation to trial and deploy technologies on the UK Continental Shelf.

NZTC’s Marine and Pipeline Transport Ancillary systems focus is on technologies that facilitate transport of hydrogen by pipeline or marine systems. These include valves, metering technologies, new materials.

The Centre also works closely with industry association Offshore Energies UK (OEUK) and the North Sea Transition Authority (formerly the Oil & Gas Authority) on hydrogen-related developments. All three organizations are co-sponsoring a North Sea Transition Deal technology study, designed to inform companies in the offshore sector on the opportunities and challenges that need to be addressed to decrease the cost of blue and green hydrogen development and production.

OEUK itself has established a Hydrogen work group, and according to Energy Policy Manager Will Webster, the association’s Energy Markets and Regulation group also plans to look at integration issues. “We are using our Energy Transition Forum to liaise with our members on this subject. We are working closely with the consortia behind hydrogen projects of any color, such as Acorn.” Acorn is a planned CCUS/hydrogen development in northeast Scotland: the first hydrogen plant, at the St Fergus gas terminal north of Aberdeen, would reform North Sea gas into clean-burning hydrogen: this would initially be blended with natural gas sent through the UK’s National Transmission System.

“We are tracking projects that are planning to produce hydrogen while getting a better understanding of the demand side,” added Thibaut Cheret, OEUK’s Emissions Improvements Manager. “We are progressing in our understanding of the supply chain implication. And we are liaising with relevant government bodies on a hydrogen business model and regulatory framework. The Government’s business model for hydrogen needs to mature further, in terms of the Contract for Difference (CfD) or equivalent for hydrogen. The demand and supply side has to progress in parallel.”


Among the UK’s emerging energy hub projects are ORION (Opportunity for Renewables Integration with Offshore Networks), a partnership between the NZTC and Shetlands Islands Council, Highlands and Islands Enterprise and University of Strathclyde. The aim is to harness the natural resources of the Shetland Islands in northern Scotland - offshore and onshore wind, tidal and wave energy. Among those supporting the development are bp, EnQuest Equinor, Shell and TotalEnergies.

Targets include use of offshore floating wind and tidal energy to produce gigawatt-scale green hydrogen, and blue hydrogen with associated storage of CO2; repurposing offshore infrastructure to host sub-stations for floating wind electricity distribution; redevelopment of Shetland’s onshore hydrocarbon terminals for export of blue hydrogen and hydrogen export linked to the European Hydrogen backbone initiative, which aims to develop a 39,700-km (24,6680sq mi) hydrogen network across 21 European countries by 2040; and providing alternative fuels for marine vessels. The partners claim ORION could supply 5% of the UK’s low carbon energy demand and 12% of its low carbon hydrogen needs by 2050, also de-risking future energy hub programs in Scotland, the UK and internationally.

The program could be ushered forward by Cerulean Winds’ proposed £10-billion ($12.3-billion) project, which envisages installing over 200 floating wind turbines offshore Shetland with a combined capacity of 4.5 GW. Of this, 3GW would be allocated to electrification of offshore platforms while 1.5 GW would power a green hydrogen plant to be built at the port of Sullom Voe. Production could start by 2024.

NZTC is also supporting the Acorn cluster and another green hydrogen proposal at Flotta in the Orkney Islands, south of Shetland. The partners in the producing Golden Eagle, Piper and Claymore fields in the central UK North Sea recently committed to continue exporting their produced oil to the terminal on Flotta through the end of the fields’ lives in the 2030s. In addition, they are investigating the potential for an industrial-scale green hydrogen hub on the island, occupying a repurposed area of the existing terminal. This would be powered by future wind farms in the sea west of Orkney.     

Aker Horizons’ Northern Horizons project is a proposed 10-GW floating offshore wind farm development in the Shetlands area, also producing green hydrogen. Starting 2030, this would be transported to a wind-powered refinery on Shetland to create ammonia, liquid hydrogen and synthetic fuels for local use and export. Aker Horizons and DNV are in a consultation process with governments and businesses on maturing the concept to FID.

Offshore Aberdeen the ERM Dolphyn project aims to produce gigawatt-scale green hydrogen via electrolysers/associated equipment fitted to the turbines. Sweden’s Vattenfall is working on a similar development nearby at the European Offshore Wind Deployment Centre.

On Teesside in northeast England, Kellas Midstream is working on the H2NorthEast project, to build a 1-GW low carbon blue hydrogen facility based around the Central Area Transmission System (CATS) terminal which receives gas from fields in the North Sea. By 2027, the proposed complex could deliver 355 MW of low-carbon hydrogen to local industry, rising to 1 GW by 2030.

At Bacton, the main reception center for gas from fields in the UK southern North Sea, McDermott International has joined a project targeting a hydrogen-led energy hub. The North Sea Transition Authority (NSTA) is leading the program, which aims to add facilities supporting hydrogen production and carbon capture and underground storage (CCUS) by 2030. McDermott will contribute provide its design capabilities and experience in greenfield and brownfield project execution.

The NSTA has established five Special Interest Groups (SIGs) to work on an executable development concept. McDermott, as a member of the Infrastructure SIG, leads Work Scope 6 - Greenfield Onshore facilities. This will assess the offshore and onshore needed to produce, store and distribute low-carbon and renewable hydrogen, with associated CCUS, drawing on industry and government input in terms of recommendations for future project development. The other four SIGs are: Hydrogen Supply; Hydrogen Demand; Regulatory; Supply Chain and Technology.