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RWE and Equinor agree on strategic partnership for security of supply and decarbonization
Equinor and RWE agreed on a strategic energy partnership for large scale projects that will contribute to the European energy supply and ramp-up of the H2 economy in Germany and the EU. In addition, the partnership will strengthen the long-term security of supply of a decarbonized European power sector.
The investments are contingent on the construction of a H2 pipeline between Norway and Germany and a German H2 downstream infrastructure. In anticipation of this infrastructure, Equinor and RWE propose a series of investments that would be major building blocks for European H2 supply and its utilization in the power sector from 2030 onwards.
“Through this collaboration we will strengthen the long-term energy security for Europe’s leading industrial country while at the same time offer a viable route to a necessary energy transition for hard to abate industries. The collaboration has the potential to develop Norway into a key supplier of H2 to Germany and Europe. This is a unique opportunity to build a H2 industry in Norway where H2 also can be used as feedstock to domestic industries,” said Anders Opedal, Equinor’s CEO and President.
Markus Krebber, CEO of RWE said, “In order to make progress in the conversion from fossil fuels to H2, there is an urgent need for a rapid ramp up of the H2 economy. Blue H2 in large quantities can be the start, with subsequent conversion into green H2 supply. This is exactly what we are driving forward with our partnership – providing the industries with significant quantities of H2. In addition, our planned investments into H2-ready gas-fired power plants will ensure security of supply in a decarbonized power sector.”
First blue, then green H2
Equinor has the ambition to invest in clean H2 to Europe projects with an initial 2 gigawatt (GW) of low-carbon (blue) H2 production capacity in Norway by 2030 and up to 10 gigawatts by 2038. These facilities are to feed into a pipeline to Germany, which is currently being assessed by Gassco, Equinor and third parties. Provided this pipeline is in place, Equinor will transport the blue H2, which RWE will purchase and use in H2-ready gas plants.
In addition to this, RWE and Equinor will collaborate in projects aimed at generating green H2. Offshore wind energy is by far the most effective form of renewable power generation. Combined with electrolyzers it will play an important role for the ramp-up of the H2 economy. In this context RWE and Equinor are planning to jointly explore possibilities for offshore production of renewable H2 in Norway, Germany and countries adjacent to the proposed H2 pipeline. Both companies are already engaged in developing AquaSector – a project in the North Sea aimed at creating a 300-MW offshore wind farm connected to offshore electrolyzers that produce green H2.
Joint investments in H2-readiness
RWE and Equinor also plan to jointly invest in flexible H2-ready gas-fired power plants (CCGT) in Germany with a total capacity of 3 gigawatts by 2030. H2-ready gas-fired power plants are based on technology that is available at scale to balance the fluctuating electricity generated from renewables and electricity demand.
In accordance with specifications from the German Federal Ministry of Economic Affairs and Climate Protection, the CCGT plants shall be able to reach 50-vol% H2 combustion at the time of commissioning. The companies will pursue a roadmap to reach 100% H2 combustion capability by the mid-2030. The RWE-Equinor partnership is to secure the fuel supply for their planned CCGT fleet in line with this decarbonization schedule: For this, Equinor initially plans to supply the natural gas required for the operation of the joint CCGT plants.
To accomplish the CCGT’s transition towards 100% H2 firing, natural gas will in a first step be replaced by low-carbon H2. As offshore H2 production plants get connected over time, green H2 will gradually complement and ultimately replace its blue counterpart in imports to Germany. Green H2 from RWE’s and Equinor’s joint projects will fire the joint CCGT fleet to complete its decarbonization journey.
In addition, RWE and Equinor will continue to explore joint investments in offshore-wind-only projects in Norway and Germany as well as green H2 production in Norway.
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