Freeport hydrogen plant given green light

Plans for a new green hydrogen plant in west Wales have been approved, paving the way for construction to begin in Milford Haven within the next two years.

The project, known as West Wales Hydrogen, will see a 20MW hydrogen production facility built at the Milford Haven site within the Celtic Freeport. The development has now reached the final investment decision stage, allowing work on the plant to move forward.

Construction is expected to begin in 2026, with the facility scheduled to begin operating in early 2028.

Once operational, the plant is expected to produce around 2,000 tonnes of low-carbon hydrogen each year. The hydrogen will be used in a range of industrial and energy applications, including port operations, manufacturing and heating systems.

The project is among the first supported by the UK Government’s Hydrogen Allocation Round (HAR1) programme to reach this stage.

Developers say the construction phase will create skilled jobs and opportunities for local contractors. The site could also be expanded in the future if demand for hydrogen grows.

The plant will be built on land previously used as an oil refinery, reflecting wider efforts to shift the area towards lower-carbon energy industries.

Luciana Ciubotariu, chief executive of the Celtic Freeport, said the decision to move ahead with the project was an important step for the region.

“MorGen Energy’s decision is another major step forward for the hydrogen economy in south west Wales,” she said.

“Projects like this show how the Celtic Freeport can support cleaner energy while creating skilled jobs in the region.”

The hydrogen will be produced using an electrolyser system supplied by Sheffield-based ITM Power, which splits water into hydrogen and oxygen using electricity.

Funding for the project is being provided by Lloyds and Société Générale.

Government support

Richard Holtum, chief executive of the Trafigura Group, said government support had played a key role in getting the project to this point.

“The UK government’s hydrogen support framework was key to this project reaching final investment decision,” he said.

Werner Lieberherr, chief executive of MorGen Energy, said the company was now preparing to begin construction.

“We are grateful for the support from government and partners and look forward to starting construction and delivering hydrogen to customers from 2028,” he said.

Energy Minister Michael Shanks said hydrogen could help reduce emissions from industries that are difficult to decarbonise.

“We are backing hydrogen because it is crucial in decarbonising industry, driving investment and creating jobs in industrial areas,” he said.

Wales Secretary Jo Stevens said the project showed Wales playing a role in the UK’s move towards cleaner energy.

“Wales is at the forefront of the green energy revolution and it’s great to see the West Wales Hydrogen project reach this stage,” she said.

The plant is expected to cut emissions by more than 15,000 tonnes of carbon dioxide a year, with government support in place for the first 15 years of operation.