The hydrogen value chain in the North Sea Canal Area is slowly taking shape

The NSCA has long been an important industrial region. To the north of Amsterdam towards Zaandam, there are numerous food factories and there are also industrial companies, including, of course, the Tata Steel plant, along the canal towards IJmuiden. The supply of energy is crucial for all industries, and this energy has to become more sustainable. This is where hydrogen plays a key role. However, building a new value chain takes time and money and it is a complex endeavour. It requires producers and importers, infrastructure to transport hydrogen, and customers who are willing to invest in new production processes.

The three links in that value chain – production and import, transport and consumption – are under development in the NSCA. Each part of the value chain is a puzzle, and coordination between the parts is absolutely essential. Where do things currently stand?

EcoLog has taken the lead in the import of green hydrogen. The company was founded as a sister company of GasLog, a Greek shipping firm with many years’ experience in transporting liquefied natural gas (LNG). EcoLog now intends to apply that knowledge of working with cold fuels to hydrogen – a gas that needs to be cooled to minus 253 degrees centigrade to turn it into a liquid.

EcoLog wants to build an import terminal for liquefied hydrogen in Afrikahaven Oost in Amsterdam’s port area. The envisioned capacity is 200,000 tonnes per year in the initial phase, with the possibility of scaling up to 600,000 tonnes per year. 'We submitted the permit application at the end of last year,' explains Mark Hoolwerf of EcoLog. 'We hope to get the permit by the middle of this year. Our ambition is to have the terminal operational by the end of 2030.' 

EcoLog is turning to a number of countries to obtain liquefied hydrogen. One of the most developed plans is the collaboration with Oman. A study agreement was signed during the UN climate conference in Dubai. Oman has a central hydrogen authority (Hydrom) and eight production consortia, five of which are located in the port town of Duqm. 'During the sultan’s visit to the Netherlands last year, producers, the liquefaction company, EcoLog as transporter, Hynetwork as network operator, and potential customers met for the first time,' says Hoolwerf. 'We’re now moving towards commercial contracts.' 

One crucial advantage of liquefied hydrogen compared to ammonia – another frequently used form of transporting hydrogen – is that there is no need for the cracking process. When ammonia arrives, it needs to go through the cracking process to convert it back into hydrogen. This is an energy-intensive process carried out at the destination, where energy is expensive. 'The energy-intensive part, liquefying the hydrogen (the liquefaction process), is done where energy is inexpensive, such as in Oman, that has a lot of cheap solar and wind energy,' explains Hoolwerf. 

Another initiative is by tanker storage firm Evos, that is specialised in the storage and transshipment of energy and chemicals. Evos wants to import hydrogen using a technology known as Liquid Organic Hydrogen Carrier (LOHC). This means that hydrogen molecules are bound to a liquid carrier, which has the advantage that existing storage and transport equipment can be used. The hydrogen is then ‘unpacked’ in the port in Amsterdam in a ‘separation plant’ (using a process of dehydrogenation). Work is currently under way on establishing a green hydrogen value chain based on this technology in Amsterdam, with the hydrogen produced in Canada by North Atlantic. 

Alongside the import of hydrogen, there are also concrete plans in the NSCA for local production of green hydrogen using electrolysis. There are two serious initiatives, according to the port authority, Port of Amsterdam. One of these is the H2era Project by the firm HyCC, which was recently acquired by Power2X. Space has already been reserved for an electrolyser with a capacity of up to 500 megawatts in the Afrikahaven and the permits have already been granted.

'The NSCA has an ideal location in relation to the wind parks in the North Sea,' says Rutger Oorsprong of Port of Amsterdam. This means that the proposed electrolysers in the port area can be easily supplied with wind power. Amsterdam’s location is also suitable for the transport of green hydrogen. “However, local production depends greatly on policy in the Netherlands and Europe. The preconditions are still lagging behind the ambitions.'

'The detailed design for the NCSA has been completed,' says Oorsprong. 'We now know right down to the nearest millimetre where the pipeline will be laid.' Hynetwork expects to make a final investment decision (FID) for this route in the coming year using a new financing model, so that construction here can also start. According to Hynetwork’s schedule, the route will be complete in 2030, and according to the Gasunie subsidiary’s latest statement, the connection with Rotterdam should be completed between late 2031 and late 2032. Hynetwork is making good progress on this too. A research plan (a draft memorandum on the scope and level of detail) was published for this route in April of this year. This plan describes the possible routes for the hydrogen pipeline that Hynetwork is looking into in terms of the environment, technology, local communities, costs and future-proofing. It also sets out which routes have already been dropped, and why.

In the port area itself, Port of Amsterdam is developing a regional hydrogen network together with the network operator Firan, called H2avennet. This is a distribution network for relatively small customers. The ambition is to extend this network under the canal and through to Zaanstad. The construction of H2avennet is ahead of Hynetwork’s high-pressure network. 'We’d rather be a year early than a year too late,' says Oorsprong. 'The market follows the infrastructure, not the other way around.'

For EcoLog, the arrival of the Hynetwork pipeline is a condition rather than a luxury. 'Transport by pipeline is the most efficient option for supplying large volumes of gaseous hydrogen,' explains Hoolwerf. 'We are desperately searching for more transport and distribution options. Hynetwork is a crucial part of this.' At the same time, EcoLog sees opportunities for liquefied hydrogen as an end product that can be distributed further by lorry, train or inland shipping to data centres or for maritime and mobility applications, for instance.

The pipeline is also absolutely vital for Tata Steel. 'We have already taken into account the connection points to the network in the design of our new production facility,' says Jeroen Klumper from the steel producer. However, he also commented on the speed of the roll-out. 'If you want to avoid all risks and don’t take any short-cuts in the procedures, it won’t go fast enough. The Dutch government has been saying for years that we should push boundaries to speed things up. But I still see all too little of this in practice.'

'The transition from coal to natural gas has already halved the carbon emissions,' explains Klumper. 'That is already a huge step. We can then go in any direction, using various proportions of hydrogen and biomethane. And certainly with CCS. This is how we’ll eventually become a green steel plant.' The final investment decision still needs to be taken, emphasised Klumper. 'However, once that decision has been taken, we will be a customer and we will enter the market to see how we can purchase hydrogen and biomethane at an affordable price.'

Klumper says that the plan’s flexibility was intentional. 'If you need demand, supply and infrastructure all at the same time, everyone ends up waiting for each other. Our plan has been designed in such a way that you don’t have to wait for all these elements at the same time. When there is supply, we will purchase it.' Letters of intent (MOUs) have been signed with EcoLog and other parties, and will see the two parties explore options for importing hydrogen from countries such as Norway and Oman.

Having Tata Steel as a major potential customer could improve the business case for other customers too. Oorsprong of Port of Amsterdam sees even greater potential in the region. 'There are many companies in Amsterdam and Zaanstad that could electrify their processes, but could also effectively decarbonise using hydrogen. Take the food industry, for example, or the production of construction materials such as cement.' 

In addition, there are further sectors that can benefit from the hydrogen network, including data centres, aviation and shipping and the road transport sector. For instance, sustainable kerosene can be transported to Schiphol using existing and new pipelines. And hydrogen bunkering trials for the shipping industry are already being carried out in IJmuiden and Amsterdam.

Despite all the plans and projects, various obstacles still need to be overcome. One of the greatest hurdles is uncertainty about government policy. The blending obligations for hydrogen in power plants were announced, for instance, but then withdrawn. 'That’s a shame,' says Hoolwerf. 'Clear and stable legislation creates a guaranteed demand. When this is in place, parties are able to enter into long-term contracts.'

Oorsprong supports that view. 'European policy on industry is still too unpredictable. Parties are only prepared to invest if they know that hydrogen can go from A to B and that there are industrial customers for the long term.' He also argues for public tenders as a market catalyst, certainly in the initial phase. 'If governments promote hydrogen in the tendering process, it boosts the market. That helps reduce barriers for other parties.'

For Klumper, geopolitics is a further reason to continue. 'You want to eliminate dependency on fossil-based energy from autocratic countries. That is true now more than ever.' However, he is also realistic. 'We have a business case for our Green Steel project. That is also the basis for the request for a bespoke agreement with the ministry. Our customers are prepared to purchase green steel, but there is currently still talk of higher prices. We are dealing with an unprofitable gap. That is why it is important to stimulate demand.'

However, he strikes a note of optimism. 'We’re going from an ambition to actually putting it into practice,' says Oorsprong. The infrastructure is on its way, the first purchase and supply contracts are being concluded and urgency is increasing. Hoolwerf of EcoLog agrees with him. 'Once we have our first purchase contracts and begin construction, you’ll see more parties committing.'