Features / Scatsta hydrogen project unlikely to happen
The recently announced deal between the SIC and Statkraft appears to have pleased nobody apart from, perhaps, Statkraft and the SIC leadership.
There has been a chorus of: “We should have held out for a much better deal” and the like.
It is certainly the case that Statkraft have lost enthusiasm for hydrogen projects and may well have been prepared to walk away from Scatsta so that the SIC are trying to make the best of it.
This is evidenced by a recent Statkraft press release:
“The company has decided to halt new development of hydrogen, though parts of the portfolio will be further matured before seeking investors to realise the projects.
“Several projects have received substantial external funding opportunities, and the company is working with authorities to ensure their progression.
“After reducing the ambition level on green hydrogen development last year, we are experiencing even more uncertainty in the market.
“Therefore, Statkraft has decided to stop new development of green hydrogen and going forward we will prioritise growth opportunities in other technologies, and market operations,” says Birgitte Ringstad Vartdal, President and CEO of Statkraft.
Clearly Statkraft will be looking to take Scatsta forward so far and then sell out.
This almost certainly will be dependent on how much financial assistance the government will be prepared to provide.
Green hydrogen remains extremely expensive to produce, and it is a grossly inefficient process. It is not at all certain that the Scatsta plans will come to fruition as the huge financial implications of these so-called green energy projects become more apparent.
In any case, the development at Scatsta and further industrialisation may well be something that Shetland can well do without.
The environmental implications of a gas and ammonia plant will need to be examined closely. The views of local residents need to be considered, something that has been somewhat lacking in the lead up to this agreement.
Frank Hay
Sustainable Shetland
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