£75 MILLION BID WIN FOR ZERO CARBON HUMBER’S NET ZERO AMBITION

£75 MILLION BID WIN FOR ZERO CARBON HUMBER’S NET ZERO AMBITION

London, United Kingdom (March 17, 2021) The Humber’s ambition to become the world’s first net zero industrial cluster has moved a step closer with the news that the Zero Carbon Humber (ZCH) Partnership has been successful in its bid for Government funding to unlock its major decarbonisation infrastructure project.

The Humber’s news is further boosted by a successful bid from the ‘Northern Endurance Partnership’ (NEP) which provides the offshore pipeline and safe storage for emissions captured both in the Humber and in Teesside, which was also successful in a separate bid. The three projects total nearly £240m of private and public funding to decarbonise the North East of England and potentially around 50% of the UK’s industrial carbon emissions.

In October 2020, twelve leading companies and organisations across the Humber jointly submitted a £75 million bid, with more than two-thirds privately funded, to accelerate decarbonisation in the UK’s most carbon-intensive industrial region, helping to support clean growth, future-proof vital industries and protect and create new jobs.

The ZCH Partnership’s plan could help the region reach net zero by 2040 through low carbon hydrogen, carbon capture and carbon removal technology. This will be enabled by a shared pipeline network to carry hydrogen to industrial customers and remove carbon dioxide from power generation and industrial emitters, transporting it to permanent storage in an offshore aquifer in the UK’s Southern North Sea via pipelines developed by NEP, serving both ZCH and Net Zero Teesside (NZT).

The ZCH proposals alone could reduce the UK’s annual emissions by 15% and safeguard 55,000 existing jobs in the region, whilst creating thousands of new STEM roles and developing skills, apprenticeships and educational opportunities in the area. It will also help to secure the future for the Humber’s traditional heavy industry and related supply chains by enabling decarbonisation and creating opportunities for growth in new technologies.

The ZCH Partnership includes Associated British Ports, British Steel, Centrica Storage Ltd, Drax Group, Equinor, Mitsubishi Power, National Grid Ventures, px Group, SSE Thermal, Saltend Cogeneration Company Limited, Uniper, and the University of Sheffield Advanced Manufacturing Research Centre (AMRC).

The public funding to the ZCH Partnership is from Phase 2 of the Industrial Decarbonisation Challenge, which forms part of the Industrial Strategy Challenge Fund, while the private funding comes from the companies within the ZCH Partnership.

The ZCH bid’s anchor project is the Equinor-led Hydrogen to Humber (H2H) Saltend proposal, which will establish the world’s largest hydrogen production plant with carbon capture on the Humber’s north bank. H2H Saltend will convert natural gas to hydrogen and capture the carbon dioxide (CO2) in the process. In the first phase, this could reduce emissions by circa 900,000 tonnes per year as industrial customers at px Group’s Saltend Chemicals Park switch fuel to low-carbon hydrogen while Triton Power’s gas power plant blends hydrogen into the fuel supply of its converted Mitsubishi Power turbines. H2H Saltend is expected to grow over time, contributing to further emissions reductions from the Chemicals Park and across the Humber.

A pipeline network, developed by National Grid Ventures, will link H2H Saltend to energy-intensive industrial sites throughout the region, to enable further decarbonisation from projects across the Humber through the capture of at least 17 million tonnes of CO2 emissions per year and the supply of up to 10 gigawatts of hydrogen by the mid-2030s. The CO2 will be compressed at Centrica Storage’s Easington site and stored under the Southern North Sea using offshore infrastructure developed by NEP (in which Equinor and National Grid are two of the partners) and shared with NZT (in which Equinor is a partner). Net Zero Teesside and the Northern Endurance Partnership made separate bids to the same fund but are closely aligned due to their shared offshore infrastructure and storage options.

The matched funding to ZCH covers obtaining land rights, development consents and front-end engineering design for H2H Saltend and the onshore pipeline infrastructure for CO2 and hydrogen, enabling the scheme to move towards a final investment decision on construction during 2023, with H2H Saltend and associated infrastructure expected to come online around 2026.

At Selby in North Yorkshire, Drax Power Station would connect to the completed CO2 pipeline network, underpinning the ZCH scheme with bioenergy with carbon capture and storage (BECCS) – a vital negative emissions technology that Drax is pioneering and which will be essential to decarbonising the Humber Cluster and helping the UK achieve its legally binding 2050 net zero carbon target. Drax has started the planning process to develop BECCS and its first unit could be operational in 2027, delivering the UK’s largest carbon capture project.

The pipeline network will also run via SSE Thermal’s Keadby site, where it is developing Keadby 3. This could become the UK’s first gas-fired power station equipped with carbon capture technology by the mid-2020s, providing decarbonised flexible power to complement intermittent renewables generation and maintain security of supply. The network will also run via Immingham, where Uniper is planning to add to its European hydrogen ambitions by developing clean hydrogen production at its Killingholme site, in line with Uniper’s pledge to be carbon neutral in Europe by 2035.

As one of the UK’s leading steel manufacturers, and a significant local employer, British Steel could benefit from the ZCH infrastructure as part of its drive to lower emissions. ABP, the major ports and logistics provider for the region, will support the global reach of the low carbon products and chemicals produced at Scunthorpe and at Saltend.

The ZCH projects are supported by the University of Sheffield Advanced Manufacturing Research Centre, which will work with its sister centre, the Nuclear AMRC, to support the anchoring of supply chain opportunities in the UK provided by these new technologies. Both centres are part of the High Value Manufacturing Catapult.

In addition to the key sites that are part of the ZCH scheme, there is further potential for other future projects to attract inward investment and cement the Humber’s reputation as the UK’s Energy Estuary and a world-leading net zero region. These include integrating offshore wind power into hydrogen production, decarbonising the regional gas grid, supplying hydrogen transport fuelling hubs, providing links to CO2 storage services to other industrial clusters and creating the world’s first sustainable maritime refuelling port.

In October 2020, the ZCH Partnership published a collection of letters of support from other significant businesses, trade bodies, educational institutions, supply chain networks, equality and diversity groups, and local authorities and LEPs. The roll-call of supporters now numbers over fifty-five and is likely to grow further as the project progresses.

Quotes from Zero Carbon Humber Partners

Simon Bird, ABP Humber Director said:
“We welcome the Government’s support for this important decarbonisation infrastructure project for the Humber region. The country’s largest ports complex, the Humber is the UK’s Energy Estuary, and plays a critical role in the renewable energy industry. Green energy is at the heart of ABP’s growth aspirations, combining offshore wind, carbon capture and storage and hydrogen production.”

Ron Deelen, CEO of British Steel said:
“This is excellent news and I congratulate everyone involved in the bid. We have ambitious plans to invest in a range of technologies to reduce the carbon intensity of our operations, with solutions that are globally recognised and acceptable to customers. The development of the ZCH project, with the proposed installation of a dual CCS and hydrogen supply pipeline, will afford us the opportunity to utilise a range of techniques to reduce the carbon intensity of our operations. This project complements the long-term decarbonising technology roadmap of British Steel.”

Greg McKenna, CEO of Centrica Storage said:
“Hydrogen will be a key enabler of the UK’s transition to Net Zero, and this bid win is a significant step forward in the decarbonisation of the Humber region. We will continue to collaborate with members of the Partnership and government to help create the world’s first net zero industrial cluster, which will, in turn, create thousands of new green jobs in the area.”

Will Gardiner, Drax CEO said:
“This funding creates more momentum behind Zero Carbon Humber’s plans to decarbonise the UK’s most carbon-intensive industrial cluster and to create and support tens of thousands of jobs. Drax has kickstarted the planning process for developing bioenergy with carbon capture and storage (BECCS), which is a landmark moment in our plans to become a carbon negative company by 2030.
“Drax’s first BECCS unit could be operational in 2027, delivering the UK’s largest carbon capture project, permanently removing millions of tonnes of CO2 from the atmosphere each year, whilst showcasing the UK’s global leadership in a clean technology needed in the fight against climate change.”

Irene Rummelhoff, Executive Vice President for Marketing, Midstream & Processing at Equinor, said:
“We are delighted that this bid from our broad partnership has been successful. We firmly believe that hydrogen and carbon capture can contribute significantly to the UK’s ambitions to drive a low carbon recovery and reach net zero. Starting with the H2H Saltend hydrogen project, Zero Carbon Humber will bring huge benefits to the Humber economy, protecting and creating jobs and reducing emissions. It will transform the Humber into the UK’s largest net zero cluster, unlock new industrial opportunities in the wider region, and make the UK a leading example the world can learn from.”

Carlos Gonzalez Peton, CEO Mitsubishi Power Europe, Ltd, said:
“We are extremely pleased to work with our partners to enable the transition to hydrogen use in power generation. Converting combined cycle gas turbines to run on hydrogen will lead to a deep decarbonisation of the power sector, while ensuring the UK retains a stable, reliable and flexible power supply and can achieve its Net-Zero goal.”

Jon Butterworth, Managing Director of National Grid Ventures said:
“Together with our partners, we’re delighted to have been successful in our bid and welcome the Government’s continued support for the development of CCUS, which can decarbonise the UK’s largest industrial heartland and build a globally competitive platform for economic growth in the North of England.
“National Grid sits at the heart of the energy system, and we want to play our full role in supporting the UK’s economic recovery through innovating and investing in strategic infrastructure solutions to support a net zero future.  In particular, we will leverage our knowledge and experience of gas and electricity transmission infrastructure, and our experience of working on previous CCS projects, to deliver the transport and storage infrastructure that will incentivise industrial emitters to adopt carbon capture technology across Teesside and Humber.”

Geoff Holmes, CEO of px Group said:
“We are delighted that Zero Carbon Humber (ZCH) has been awarded Government funding. ZCH will have a considerable impact on reducing the UK’s emissions, safeguarding and creating new jobs, and helping to secure industry in the area.”
“Our Saltend Chemicals Park will be home to the ZCH anchor project, Hydrogen to Humber Saltend, which will establish the world’s largest hydrogen production plant with carbon capture. Saltend, with recent investments and today’s news, is now at the heart of UK energy transition and industrial decarbonisation which will deliver long-term sustainable manufacturing.
“We’re incredibly excited to be pressing on with our work with Equinor and 11 other ZCH partners, as well as wider business in the Humber Region.”

Stephen Wheeler, Managing Director of SSE Thermal said:
“This is fantastic news for the Humber and a major step towards the delivery of cutting-edge carbon capture projects like our own Keadby 3 Power Station, as well as the production and transport of low-carbon hydrogen across the region. As the UK’s most carbon-intensive region, the Humber has to be at the centre of the UK’s climate strategy as we look to accelerate the transition to a net zero economy. With the UK hosting COP26 this November, Zero Carbon Humber is a prime example of how we can deliver on our climate commitments in a way that supports high-quality jobs, stimulates growth, and ensures a just transition for communities.”

Mick Farr, President and Chief Operating Officer of Triton Power said:
“Triton Power is delighted that the government (via Innovate UK) has seen the unbelievable potential for the Humber to take centre stage in the country’s transition to net zero. Converting our turbine generators to burn hydrogen and then provide cogeneration to our customers at the chemicals park is both strategically right but also deliverable due to the skills and infrastructure that is unique to our partnership. We have often seen new initiatives fail due to lack of commitment and private sector investment but this time I feel the energy building around this exciting opportunity!”

Mike Lockett, Uniper UK Country Chairman and Chief Commercial Officer Power commented:

“This is really great news for the Humber region and the project partners’ decarbonisation plans in the area. We know that hydrogen and the decarbonisation of industrial clusters, will be crucial to the UK’s commitment to reach net-zero by 2050; the Zero Carbon Humber project will provide the infrastructure that enables Uniper’s ambitions for the development of clean hydrogen production at our Killingholme site.”

Ben Morgan, Research Director of University of Sheffield AMRC said:
"The successful award of this £75m project represents a huge vote of confidence in the Humber region and the wider North of England. We are pleased that the ambition of this project to support the net zero agenda and our collective capability to build back greener has been recognised. The AMRC is looking forward to engaging local supply chains and enabling growth of high value jobs through the programme. The hard work in earnest starts now and we hope that a successful outcome of the project will make an important step toward levelling up the economy.”

About Mitsubishi Power
Mitsubishi Power employs more than 1,000 power generation, energy storage, and digital solutions experts and professionals in Europe, Middle East and Africa (EMEA). Our employees are focused on empowering customers to affordably and reliably combat climate change while also advancing human prosperity throughout the EMEA region. The company’s power generation solutions include natural gas, steam, aero-derivative, geothermal, fuel cells (SOFC), environmental controls, and services. Energy storage solutions include green hydrogen and battery energy storage systems. Mitsubishi Power also offers digital solutions that enable autonomous operations and maintenance of power assets.
Mitsubishi Power, Ltd. is a wholly owned subsidiary of Mitsubishi Heavy Industries, Ltd. (MHI). Headquartered in Tokyo, Japan, MHI is one of the world’s leading heavy machinery manufacturers with engineering and manufacturing businesses spanning energy, infrastructure, transport, aerospace and defence.