Denmark to build hydrogen islands; H2 Green Steel raises financing

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A view of the turbines at Orsted's offshore wind farm near Nysted, Denmark (Source: Reuters/Tom Little)

Danish infrastructure investment group Copenhagen Infrastructure (CIP) plans to develop a string of so-called energy islands in the North Sea, the Baltic Sea, and in South-East Asia, it said in a statement.

CIP, through the independent but majority-owned Copenhagen Energy Islands, is currently developing a portfolio of around 10 energy island projects which will include next generation offshore wind deployment and large, offshore clean hydrogen production facilities.

The energy islands are large-scale offshore energy hubs with key value drivers which include a substantial reduction in power transmission costs, large-scale offshore green hydrogen production, and related synergies between power and hydrogen production, it said.

The founding group of Copenhagen Energy Islands includes major Nordic, European, and North American investors including PensionDanmark, PFA, SEB, and Andel, CIP said.

“Today, the challenge for offshore wind is less about building the incremental offshore wind farm, but more how to integrate large-scale offshore wind energy into the global energy systems,” said Jakob Baruël Poulsen, Managing Partner and founder of CIP.

“We see energy islands as a key tool in solving this challenge and realizing the ambitious offshore wind targets across the globe.”

H2 Green Steel raises financing

H2 Green Steel has signed debt financing agreements for 4.2 billion euros ($4.6 billion) in project financing and has increased previously-announced equity raised by 300 million euros to 2.1 billion euros, the company said.

The company, including a 250 million euro grant from the EU Innovation Fund, has now secured financing of close to 6.5 billion euros for a large-scale ‘green’ steel plant in Northern Sweden.

The Swedish company has signed definitive financing documentation for 3.5 billion euros in senior debt and an up-to-600-million euro junior debt facility, it said.

New Shareholders include Microsoft Climate Innovation Fund, Mubea, and Siemens Financial Services.

“No one has scrutinized our project more thoroughly than those who back our financing. This massive commitment from our lenders, investors and the Innovation Fund is true recognition of the quality of our company,” said CEO of H2 Green Steel Henrik Henriksson.

“It’s also a big win for the climate as we hope the model will inspire the financing of other decarbonization initiatives in hard-to-abate industries.”

Shipping conversion to cost up to $2.25 trillion, says study

Global conversion of today’s shipping sector to ammonia fuel will cost between $1.98 trillion and $2.25 trillion in infrastructure investments, according to a new study from Oxford University ‘Optimal fuel supply of green ammonia to decarbonize global shipping.’

The study found that demand for ammonia made from renewable sources could be three or four times the current fossil-fuel-produced ammonia production levels, which would require major new levels of new infrastructure investment.

“Our model predicts a regionalization of supply, entailing a few large supply clusters that will serve regional demand centers, with limited long-distance shipping of green ammonia fuel,” the study said.

“In this cost-efficient model, practically all green ammonia production is predicted to lie within 40° latitudes North/South. To facilitate this transformation, investments worth $2 trillion would be needed, half of which will be required in low- and middle-income countries.”

The shipping industry faces hurdles to achieve decarbonization due to long asset lifetimes, the price gap between clean fuel options and heavy fuel oils – on which most maritime vessels currently run – and the need for large-scale coordination amongst a number of different stakeholders.

“As such, there is considerable uncertainty in terms of the optimal path to decarbonize the maritime sector relating to the future energy fuel mix and the infrastructure necessary to facilitate this new fuel supply chain,” the study said.

Plug Power starts production at Georgia plant

Hydrogen company Plug Power has begun operations of a liquid clean hydrogen plant in Georgia, United States, the largest in the country with a daily production rate of 15 tons a day, the company said in a statement.

The plant includes eight 5MW PEM electrolyzers to produce the hydrogen which is then liquified at -423 F (-253 C) to be delivered to customers' hydrogen fueling stations using Plug cryogenic trailers, it said.

“Bringing this green hydrogen plant online demonstrates that we are the leading builder of global hydrogen infrastructure for supporting customer demand in decarbonizing their operations,” said Plug Power CEO Andy Marsh.

Separately, Plug Power shares dropped to a four-year low January 18 after revealing plans to sell up to $1 billion in common stock in order to raise cash.

Shares will be offered through, or to, B. Riley Securities which will act as a sales agent for the offering.  

Plug Power’s shares fell to $2.26 after the announcement, the lowest since September 2019 and a long way from the high of over $64/share in February, 2021.

The company saw a sharp fall in share value in November after it warned the liquid hydrogen market in North America had been “severely constrained by multiple frequent force majeure events, leading to volume constraints which has delayed Plug’s deployments and service margin improvements.”

At the end of September 2023, Plug Power had $100.8 million of cash and cash equivalents, down from $690.6 million at the end of 2022, Reuters reported.

By Reuters Events Hydrogen