Shell Deutschland GmbH has made a final investment decision (FID) to progress REFHYNE II, a 100-megawatt (MW) renewable proton-exchange membrane (PEM) hydrogen electrolyzer at the Shell Energy and Chemicals Park Rheinland in Germany.
Using renewable electricity, REFHYNE II is expected to produce up to 44,000 kilograms per day of renewable hydrogen to partially decarbonize site operations, Shell said in a statement. The electrolyzer is scheduled to begin operating in 2027.
Renewable hydrogen from REFHYNE II will be used at the Shell Energy and Chemicals Park to produce energy products such as transport fuels with a lower carbon intensity. Shell stated that using renewable hydrogen at its Rheinland facility will help to further reduce its Scope 1 and 2 emissions.
In the long term, renewable hydrogen from REFHYNE II could be directly supplied to help lower industrial emissions in the region as customer demand evolves, Shell noted.
Shell said that the project will benefit from the experience that the company and its project partners, ITM and Linde, have in developing, constructing and operating other renewable hydrogen projects in Europe.
REFHYNE II follows the success of the 10-MW PEM electrolyzer REFHYNE I, which began operating in 2021 and uses the same technology. Since 2021, preparations have been under way to deliver the detailed engineering plans for REFHYNE II, complete on-site groundworks, and connect to existing infrastructure, according to the statement.
“Today’s announcement marks an important milestone in delivering our strategy of more value with less emissions. Investing in REFHYNE II is a visible demonstration of our commitment to the hydrogen economy, which will play an important role in helping to decarbonize Shell’s operations and customer products,” Shell Downstream, Renewables and Energy Solutions Director Huibert Vigeveno said. “Our decision to invest illustrates what can be achieved with the right enabling conditions to deliver competitive projects”.
Shell remarked that the REFHYNE II project has been enabled by supportive policies, including the European Union’s (EU) binding targets for the use of renewable hydrogen, and the German Federal Government’s regulatory framework. The project has also received funding from the EU’s Horizon 2020 research and innovation program. The company expects the hydrogen produced from REFHYNE II will meet the requirements for renewable fuels of non-biological origin (RFNBO) in accordance with current EU legislation.
The capital investment for REFHYNE II will be absorbed within Shell’s cash capital expenditure guidance, and this project exceeds the internal rate of return (IRR) hurdle rate for its Renewables and Energy Solutions business, the company said.
Shell did not give the specific financial details but said it plans to invest $10 billion to $15 billion in the period of 2023-2025 to support the development of low-carbon energy solutions including e-mobility, low-carbon fuels, renewable power generation, hydrogen, and carbon capture and storage. Last year, Shell invested $5.6 billion in low-carbon solutions, which was 23 percent of its capital spending.
Meanwhile, in the Netherlands, Shell is currently constructing Holland Hydrogen I with a capacity of 200 MW, one of Europe’s largest renewable hydrogen plants under construction.
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