Aker Clean Hydrogen says some of its Norwegian projects have achieved green hydrogen costs of $3.5-4.5/kg, putting them at parity with grey hydrogen.

Aker says green hydrogen has a clear path to competitiveness by 2030, with grey hydrogen costs rising faster than previously anticipated on the back of rising prices for carbon and natural gas, the latter of which has spiked recently.

"Some of our Norwegian projects under development show hydrogen cost levels of $3.5-4.5/kg. In the current market environment, with very high gas prices, this matches the cost levels for grey hydrogen," says Knut Nyborg, CEO of Aker Clean Hydrogen.

Gas prices in Europe have hit record levels in recent weeks, dramatically altering the economics of grey hydrogen, although prices have eased slightly this week on milder weather forecasts.

“Some of our Norwegian projects under development show hydrogen cost levels of $3.5-4.5/kg” Nyborg, Aker Clean Hydrogen

Aker expects to make FID on two projects in Norway in the second half of 2022 after progressing with power supply and offtake negotiations.

FIDs are expected next year on the 40MW Rjukan green hydrogen project and the 100MW Berlevag green ammonia project, the Norway-based company says in its third-quarter earnings statement.

Recent progress at Rjukan includes the securing of a competitive long-term power agreement and discussions with a major industrial offtaker. Aker also says it is “firming up” offtake agreements with buyers in the regional shipping market for supply from Berlevag, a joint venture with Norwegian hydroelectric power operator Varanger Kraft.

Aker has a total portfolio of industrial hydrogen projects and prospects of 1.8GW. It signed a memorandum of understanding with renewables developer Tunur in Q3 to establish a clean hydrogen and ammonia value chain in Tunisia. It is also exploring a green ammonia value chain for offshore platform supply vessels together with oil company Aker BP.

In addition, it has launched the Hegra project with fertiliser group Yara and utility Statkraft to develop a green ammonia facility at Yara's Heroya plant in Norway, and is simultaneously developing green ammonia projects in Uruguay and Chile.

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Author: Stuart Penson