TotalEnergies has signed a 15-year offtake deal with industrial gases firm Air Products for 70,000 tonnes of green hydrogen a year from 2030, to be used in its Northern European refineries.
This deal follows the launch of a tender for 500,000 tonnes of annual supply in September 2023.
While the call for hydrogen supply is still ongoing, TotalEnergies CEO Patrick Pouyanné had commented earlier this year that prices were much higher than expected, at around €8/kg, compared to €1/kg for grey H2 currently used by its refineries.
Neither company has disclosed the value of this offtake agreement, nor how much the hydrogen will cost Air Products to produce.
However, TotalEnergies has likely signed this agreement with an eye towards the targets under the EU’s updated Renewable Energy Directive, which requires 42% of hydrogen used by European industry to be green, as defined by its Delegated Acts, by 2030.
This directive will be transposed into the national legislation of each member state by spring next year, which could not only mean fines levelled against companies that do not comply, but additional interim targets to ensure each country meets the overall goal.
TotalEnergies has also set a corporate target of reducing its Scope 1 and 2 emissions 40% by 2030 compared to the scale of greenhouse gases it emitted in 2015.
The company had last year also agreed offtake for green hydrogen from the 30MW Bad Lauchstädt energy park, to be used in the massive Leuna chemical works in Germany.
Global portfolio
Air Products plans to supply the 70,000 tonnes of renewable hydrogen a year to TotalEnergies from its portfolio of global projects, rather than from a single facility.
By 2030, its largest green hydrogen project, the 2.2GW Neom complex in Saudi Arabia, will already have been on stream and annually exporting up to 1.2 million tonnes of ammonia, equivalent to more than 200,000 tonnes of H2, for at least three years.
The industrial gases firm is also developing infrastructure at the ports of Hamburg in Germany, Rotterdam in the Netherlands, and Immingham in the UK, which would crack imported NH3 back into hydrogen.
However, Air Products has also argued that some of these developments could be at risk based on the EU’s requirements for “negotiated third-party access” — ie, allowing private companies to use equipment built and paid for by another private company — which was included in the recently passed hydrogen and decarbonised gas markets package.
