A cash injection of €30m from the German government will enable work to begin on the 30MW pilot phase of the ambitious 700MW Westküste 100 green hydrogen project.

The newly formed joint venture, H2 Westküste GmbH — comprising EDF Deutschland, Ørsted and independent oil refinery Raffinerie Heide — will now begin work on building a 30MW electrolyser powered by renewable energy. The world’s largest electrolyser in operation today is a 20MW unit in Japan.

If the five-year, €89m pilot at the Heide refinery in Schleswig-Holstein proves to be successful, the joint venture aims to move forward with its groundbreaking 700MW cross-sector project.

A 700MW electrolyser — probably powered by offshore wind — would split water molecules into hydrogen and oxygen. The oxygen would be sold to the nearby Holcim cement plant for use as “oxyfuel”, with the waste heat from the electrolysis process sold to a nearby district heating system, thus creating additional revenue streams. Most electrolysis projects simply release the heat and oxygen into the air.

A large proportion of the green hydrogen will be combined with carbon dioxide captured from the cement plant to produce synthetic methanol, which would then be refined into carbon-neutral synthetic kerosene (ie, aviation fuel), for use at the nearby Hamburg airport. Some of the green hydrogen would also be used to power local transport.

Up to ten million tonnes of green hydrogen could be stored inside salt caverns on the Heide refinery’s land, and transported via an existing bidirectional hydrogen pipeline to a Linde facility 30km away for distribution.

The funding approval from the federal government — as part of Germany’s “real-world laboratories of the energy transition” programme — comes with a green light for the 30MW pilot.

The green hydrogen produced in this initial phase will be used to replace the highly polluting “grey hydrogen” currently used for oil refining at the site (which is produced from unabated natural gas, releasing nine to 12 tonnes of CO2 for every tonne of H2 produced).

The exact source of the renewable energy for the pilot project has not been agreed, Recharge has learned, despite an earlier press release stating that its power would come from offshore wind.

“We would like to run the electrolysis unit with electricity from offshore wind power," the consortium tells Recharge. “However, because we are at the beginning of the development, we will of course be looking into which sources are the most economical (onshore, offshore, photovoltaics, etc.) The most important point is that the electricity will be from a renewable source.”

The pilot will also “create the necessary know-how” to enable the partners to build the larger project.

“For us at Raffinerie Heide, the funding approval received today fires the gun to go all out in creating a new, green business model around the manufacture and exploitation of green hydrogen for the future,” said the refinery’s chief executive, Jürgen Wollschläger. “In building and commissioning an industrial-scale electrolysis plant on our site we will become an active part of the industry of tomorrow.”

Volker Malmen, managing director of Orsted in Germany, added: “This project is unique in its use of offshore wind energy for large-scale hydrogen production.

“No other renewable energy source can provide such reliably large quantities of green electricity for electrolysis. For this reason, the expansion of renewables and offshore wind power in particular must be aligned with the increased demand associated with hydrogen production.”

Wollschläger told Recharge last year: “Orsted... actually has licenses to build the equivalent offshore wind park next door. And that's actually why they're invested and interested. They want to monetise on that license, which they currently can't do as the electricity grid is so congested.”

While the joint venture is leading the project, there is a wider consortium involved, including international engineering conglomerate Thyssenkrupp; cement maker Holcim Deutschland; local gas distribution company OGE; Heide’s municipal utility; municipal economic association Thüga; the Region Heide development agency and the Westküste University of Applied Sciences.

CORRECTION: This article has been updated to clarify that the source of the pilot project's green electricity has not yet been decided. The original press release stated that the power would come from offshore wind.