Shell’s ambitious hydrogen project takes a decisive step forward as the energy giant secures renewable electricity through strategic partnerships. The company has finalized power purchase agreements that will fuel its groundbreaking REFHYNE 2 electrolyser at the Energy and Chemicals Park Rheinland. This milestone represents more than just another industrial contract—it signals a fundamental shift in how major energy companies approach decarbonization.
Shell enters into dual renewable power contracts for hydrogen production
Shell Energy Europe Limited has inked two different power purchase agreements to ensure the supply of renewable energy for the REFHYNE 2 hydrogen electrolyser, which is currently under construction. In the first agreement, Shell Energy will receive about one-third of the production from a 332-megawatt offshore wind farm developed by Nordsee One GmbH, a joint venture between Northland Power and RWE. This agreement provides a basis for Shell’s renewable energy policy.
The second agreement is with Solarkraftwerk Halenbeck-Rohlsdorf I/II GmbH, where Shell will offtake approximately 75% of the electricity produced from a 230 MW solar farm that is under construction. The solar farm is made up of two almost similar projects, with a maximum capacity of 115 megawatts each. The project focuses on subsidy-free electricity production from solar energy, storage solutions, and optimizing biodiversity.
REFHYNE 2 project builds on successful predecessor technology
The 100 MW electrolyser is a real step up from REFHYNE 1, which has been running successfully since mid-2021 at a 10 MW capacity and 1,300 tonnes of hydrogen a year. REFHYNE 2 will produce up to 16,000 tonnes of renewable hydrogen per year when it goes online in 2027, making a contribution to the decarbonization of energy products from transport fuels to chemicals produced on site at the facility.
Strategic partnerships enable long-term renewable hydrogen development
The power contracts show that Shell is committed to developing a sustainable hydrogen production capacity throughout Europe. The solar contract has a length of 10 years, showing much longer-term thinking than the wind contract, which was concluded for five years. This enables Shell to meet the binding targets of the European Union regarding the use of renewable hydrogen and also supports the regulatory environment in Germany regarding clean energy development.
According to Andy Beard, the President of Hydrogen at Shell, the importance of the agreements cannot be overemphasized: “Through these renewable power agreements, we are integrating our world-class trading expertise and our Low Carbon Solutions knowledge to decarbonize Shell’s business and our customers’ products with innovative renewable hydrogen solutions.” Funding for the project has been provided by the Horizon 2020 research and innovation program, which is run by the EU.
German plant becomes key to European hydrogen policy
The Shell Energy and Chemicals Park Rheinland is an important hub for the distribution of energy products in the European market. Energy products that are produced at the facility include high-quality fuels, lubricants for electric vehicles, fluids, cooling fluids, paints, cosmetics, and electronic components. The addition of renewable hydrogen production will aid in the decarbonization of these industrial processes while retaining competitiveness in manufacturing.
When fully operational, REFHYNE 1 and 2, together with Shell’s Holland Hydrogen 1 project in the Netherlands, will offer over 300 MW of renewable hydrogen production capacity in Europe. This holistic strategy enables the establishment of vital platforms for future hydrogen development, positioning Shell as a front-runner in the production of renewable hydrogen on a commercial scale within the region.
Shell’s strategic investment in renewable hydrogen technology showcases how the world’s major energy companies can succeed in transitioning towards sustainable businesses and remain competitive in the industry. The REFHYNE 2 project is an outstanding example of how partnerships for renewable energy can help decarbonise industries and industries in Europe at last, with new standards for clean energy integration.
