German developer HH2E has received project funding to build Europe's second largest GW-class green hydrogen plant

HH2E, the developer of Germany's pioneering green hydrogen project franchise model, has secured funding for an investment decision on the first 100 MW phase of the GW scale green hydrogen project in Lublin, Germany.

HH2E has received an undisclosed amount of funding from Foresight, the UK infrastructure fund, for HH2E's renewable hydrogen development project in Lublin, northern Germany. The project is one of 15 HH2E projects in Germany. The funding will allow HH2E to obtain a final investment decision as soon as early in the fourth quarter, and the project is not dependent on subsidies and will begin commercial operations in mid-2025.

A spokesman for HH2E said the company has signed a partial offtake agreement and is pre-selling hydrogen production, but did not disclose the specific percentage.

Most of the hydrogen from the project will be delivered to hydrogen filling stations in Germany to supply the German road freight market.

HH2E expects a purchase and sale price of 8-12 euros per kilogram.

A spokesman for HH2E said this was an acceptable price level for the market and that the final price for individual customers would also depend on the cost of distributing hydrogen. Other customers include the chemical industry and commercial aviation users.

If the HH2E project achieves a final investment decision, it will be one of the largest green Hydrogen developments in Europe following a final decision on Shell's 200MW Holland Hydrogen 1 project in the Netherlands in 2022.

HH2E says this pace of project development is feasible. The company uses the same parameters across its portfolio of projects, which reduces the oversight, licensing, and procurement work associated with each project.

The Lubmin project, which is also being developed on the site of a decommissioned nuclear power plant, has an existing grid connection and is close to the now-defunct Nord Stream 1 and 2 gas pipeline infrastructure, meaning it is also working to deliver gas by pipeline.

HH2E has developed its first 100MW - 1GW Thierbach project in Borna Borna, eastern Germany, prior to a final investment decision. Each project is carried out according to HH2E's "franchise model" and is developed by a different special purpose company in which HH2E is a shareholder and has an equity investor in the specific project. In the Lubmin project, equity investor Foresight Company.

Swiss energy company MET Group, which was previously reported to be a co-developer of the project, has now joined as a partner in the project to promote the sale of green hydrogen produced at Lubmin and other plants in Germany. The Thierbach project is supported by Foresight and HydrogenOne, a specialist hydrogen investor.

HH2E had to design and procure the project before it entered into a final investment decision to decide on an offtake agreement for the production of 6,000 tonnes of green hydrogen in the first phase of the Lubmin project.

The project envisages the construction of 100MW at a total cost of 230 million euros in the first phase, with the goal of expanding to 1GW at a total cost of 1 billion euros. The project proposal combines alkaline electrolyzers and battery storage to enable continuous production of hydrogen even without a continuous supply of renewable energy.

HH2E has signed an agreement with the Norwegian electrolyzer producer for 120MW of electrolyzer capacity worth 30 million euros. The cells will be spread across HH2E's broad portfolio of projects, the vast majority of which have not been announced. HH2E is in talks with Nel and other manufacturers for further deals on electrolyzer capacity.

HH2E eventually hopes to have 15 concession projects in Germany ranging from 100MW to 1GW, reaching 4GW by 2040, and has purchased or retained land for most of these projects.