Hydrogen Project Advances Further: Neste Continues Work in Renewable Hydrogen Production, Porvoo, Finland
Neste Pauses Green Hydrogen Project at Porvoo Refinery
Neste, a Finnish energy company, has temporarily halted its 120 MW green hydrogen electrolyzer project at its Porvoo refinery due to challenging market conditions and limited renewable hydrogen use at the site. The decision to pause this significant investment was announced around late 2024.
The original project, which aimed to produce green hydrogen for refinery operations and support Finland's energy transition goals, involved installing a 120 MW alkaline water electrolyzer, a technology supplied by Thyssenkrupp Nucera. However, the company is now exploring alternative renewable hydrogen options in partnership with other companies, including Porvoon Energia.
The Porvoo refinery's transformation to the most sustainable refinery in Europe by 2030 is further supported by the utilization of renewable heat in district heating. This potential expansion of the refinery's sustainability efforts could see the renewable heat from the green hydrogen project being used in district heating.
The hydrogen projects at Neste's Porvoo refinery have received significant recognition, including IPCEI status and public funding. In December 2022, Neste received EUR 27.7 million of public funding from Business Finland for its renewable hydrogen projects at the Porvoo refinery.
Markku Korvenranta, the Executive Vice President in Neste's Oil Products, stated that the company has progressed to the basic engineering phase with the project. Despite the pause, Neste remains committed to its sustainability targets and the decarbonization of the refining sector.
Porvoon Energia, a Finnish energy company focusing on heat and electricity production, distribution, and electricity network development, is a key partner in Neste's renewable hydrogen projects. The collaboration aims to find alternative renewable hydrogen production solutions better suited to current market conditions and demand.
The green hydrogen project at Neste's Porvoo refinery contributes to the EU green hydrogen value chain. It is one of the largest development projects to produce green hydrogen in European refineries. If an investment decision is made, green hydrogen production could start in 2026.
The goal of the project is to reach carbon neutral production by 2035. The green hydrogen would primarily be used in Neste's Porvoo refinery's processes, reducing its carbon footprint and contributing to Finland's climate goals. The project's halt indicates current economic and market constraints on using renewable hydrogen at scale in the refining sector.
Despite the pause in the 120 MW green hydrogen electrolyzer project, Neste continues to work on its commitment to sustainability and the decarbonization of the refining sector. The company is expected to reach investment decision readiness in early 2024.
- Neste is exploring alternative renewable hydrogen options in partnership with Porvoon Energia, aiming to find production solutions better suited to current market conditions and demand, as part of the hydrogen economy.
- The green hydrogen project at Neste's Porvoo refinery is one of the largest development projects to produce green hydrogen in European refineries, contributing to the EU green hydrogen value chain and the overall climate-change mitigation efforts.
- The halt of Neste's 120 MW green hydrogen electrolyzer project, designed to support Finland's energy transition goals, demonstrates the challenges faced by the industry when it comes to sustaining large-scale renewable hydrogen projects in the face of climate-change and market fluctuations.
- In order to achieve carbon neutral production by 2035, the green hydrogen project aims to primarily be used in Neste's Porvoo refinery's processes, thus reducing its carbon footprint and contributing to Finland's climate goals, all while supporting the scientific advancements in environmental-science and renewable-energy.
- Finance plays a crucial role in the success of these hydrogen projects, with public funding like the EUR 27.7 million received by Neste from Business Finland in December 2022, helping to drive the progress and scalability of green hydrogen projects within the industry.
