Photo: Freepik

The project mapped 167 Nordic hydrogen projects, ten of which fulfilled the proposed hydrogen valley definition at the time of the mapping.

The hydrogen valley criterion that most projects fail to meet is the requirement to supply hydrogen to several end-use sectors. Only 25 of the mapped projects supply hydrogen to specific off-takers in multiple sectors, meaning that 142 mapped projects fail to meet this criterion. Of the 25 projects that do supply more than one end-use sector, 16 fail to meet the hydrogen valley definition, mainly because of insufficient project maturity.

The capacity of the mapped projects is significant – about 8 Mt or 270 TWh hydrogen per year – but only about 0.2% of this capacity is operational, with an additional approx. 1% under construction. Most projects – especially those very large in scale (hundreds of MW or more) – are in the early stages of development (pre-feasibility phase).

Projects in Sweden and Finland often aim to use hydrogen on-site for e-fuel/chemicals production or to decarbonise existing industrial processes. While Danish projects also commonly focus on hydrogen for on-site e-fuels/chemicals production, Denmark also hosts several large-scale export-oriented projects aimed at supplying hydrogen to potential future European or global markets. To export hydrogen, Danish projects often plan to use (prospective) hydrogen gas grids. Norwegian projects also cover a variety of end-uses but are distinguished by a focus on utilising hydrogen for ammonia production or as a maritime fuel. These two aspects are sometimes combined, with hydrogen being used to produce ammonia for use as maritime fuel. However there are projects that focus on one aspect, either producing hydrogen for direct use as maritime fuel or producing ammonia for industrial purposes (e.g. to decarbonise fertiliser production). It should be noted that, for the Norwegian projects, the mapping often failed to identify intended end-users, indicating that the planned hydrogen capacity is available “on the market” for interested off-takers. In contrast to Swedish, Finnish and Danish projects, fewer Norwegian projects produce hydrogen for use on-site (instead exporting hydrogen to e.g. the transport sector), meaning that they are not in control of the entire value chain. Consequently, final off-takers are sometimes not identified even in advanced stages of project development.

The number of mapped projects in Iceland, Åland, the Faroe Islands and Greenland is too low to draw general conclusions. Most of the mapped Icelandic projects target e-fuel/chemicals production or direct use in transport. This is in-line with the Hydrogen and E-fuels Roadmap for Iceland which identifies hydrogen and e-fuels as key elements in decarbonising the transport and maritime sectors in Iceland. Identified projects in Åland are export oriented (aiming to export hydrogen via prospective Baltic Sea hydrogen infrastructure).

The most common hydrogen derivatives produced by the mapped projects are methanol, ammonia and methane, with the production of e-SAF being less common. Common direct uses of hydrogen include road transport, industrial heating and decarbonisation of industrial processes by replacing a fossil input (e.g. coal in steel making or fossil hydrogen in refinery processes or ammonia production).

This project has not assessed Nordic strengths and weaknesses in relation to other EU countries. However, the presence of large-scale export projects targeting the European market (especially in Denmark) indicate a position of strength.

The digital tool, as a publicly available interactive web application, allows users to view and analyse data gathered during the mapping process. It is thus essential for the mapping to indicate any true added value for Nordic stakeholders. However, the tool is currently only a prototype and both the database and the tool will require regular updates, maintenance and development to stay relevant.

Since 1 July 2024, there has been a ban on the use and carriage of HFO in Arctic waters, which can be expected to incentivise the use of alternative fuels in Arctic maritime transport.

Hydrogen and hydrogen-based fuels are among the promising alternatives to facilitate the decarbonisation of shipping. In addition to their environmental benefits, the isolated power infrastructure in the Arctic makes green hydrogen and hydrogen-based fuels particularly interesting. Wind and PV have huge untapped potential in the region and can be put in use in areas with no grid or low grid capacity. In addition to supplying marine fuel, the scattered communities in the Arctic would benefit from the harnessed power, which would in turn contribute to job and value creation in the region.

The current use of hydrogen in Arctic maritime transport is negligible compared to fossil fuels. Projects producing hydrogen or hydrogen-based e-fuels suitable for maritime applications (such as ammonia and methanol) are under development in the region, especially in Northern Norway where about 600 thousand tonnes of hydrogen capacity (including natural gas reforming with CCS) is under development, mostly for ammonia production and often aimed at maritime off-takers. Several large-scale e-fuel projects are also under development in Iceland (in particular, roughly 300 ktpa of planned ammonia production), where maritime activities are an important part of the economy.

The advancement of regulatory frameworks, bunkering facilities and technical and operational know-how onboard ships could all facilitate the adoption of hydrogen and hydrogen-based fuels in Arctic maritime transport.

The three most important drivers for the formation of Nordic hydrogen valleys are current and future access to renewable energy production, adequate policy support on a Nordic and EU level and the ambitions of industries to use hydrogen for the decarbonisation of their own activities.

The three most important barriers that need to be addressed include the overall business case for hydrogen projects, deficiencies in regulatory frameworks, and the lack of local energy supply and infrastructure. The overall business case is affected both by an undeveloped market, inadequate infrastructure and the availability and cost of power supply.

One important finding in this work is the significant variation in priorities between stakeholders regarding which policy measures are considered most important to implement. However, based on the findings in this work, the highest-priority policy measures to support the development of Nordic hydrogen valleys include:

The respondents of the interviews, who represented national hydrogen associations and project managers involved in the “Nordic Hydrogen Valleys as Energy Hubs” programme, stressed the need for financial support for the entire value chain of early-stage hydrogen projects. This value chain includes energy supply and hydrogen production, as well as hydrogen distribution, infrastructure and utilisation.