Norwegian renewable power generator Statkraft has unveiled plans to take forward a proposed 400MW green hydrogen and ammonia project on the Shetland Islands in Scotland.

Statkraft will aim to develop the Shetland project on land adjacent to the disused Scatsta Airport, which is near the existing Sullom Voe oil terminal and Shetland Gas Plant. The site has been leased from Shetland Islands Council.

The company, which is Europe’s largest renewable power generator, has three windfarms on Shetland in the pre-construction phase:  Mossy Hill near Lerwick, and Energy Isles and Beaw Field on Yell.

 “This is an exciting milestone for the potential to develop green H₂ and ammonia production in Shetland. This scheme offers an opportunity to combine Shetland’s renewable resources with innovative technology,” said Stuart Marley, Statkraft’s principal H₂ project manager.

“The historic links with energy production mean there is a wealth of talent in the region to draw on to ensure projects are run safely and efficiently. While we are currently in the early stages of development, we will work closely with local stakeholders and the wider Shetland community, as we progress this project.”

The green ammonia produced will be used by a wide range of industries, including as a sustainable fuel for marine shipping and to decarbonise fertiliser production.

The decision to move forward with the Shetland project comes as Statkraft, the core business of which is hydroelectric power generation, embarks on a reset of its strategy in response to increased geopolitical risks, challenging market conditions and “high uncertainty”

 The new strategy includes “stopping new development of green hydrogen projects and further offshore wind activities, except for the development of the North Irish Sea Array project.

“Power price expectations are reduced for the upcoming years, while technology costs have increased—most notably in hydrogen and offshore wind, where markets have progressed slower than previously expected,” the company said in June, in its latest earning report.

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Author: Stuart Penson