LONDON— BP PLC is partnering with renewable energy giant Ørsted A/S to produce hydrogen from wind power, the oil major’s first big project in a sector that it—and the wider industry—believe will play a key role in the transition to low-carbon energy.
Using renewable power such as wind and solar to produce hydrogen, instead of fossil fuels such as gas or coal, is expected to be important for reducing global carbon emissions—although it remains a more expensive option. While hydrogen only makes up a small amount of the world’s energy use—mostly for refining and chemical production—it is responsible for significant emissions.
Under the deal announced Tuesday, BP said it would use wind energy from Ørsted’s North Sea wind farm to produce hydrogen for its Lingen refinery in northwest Germany. The two companies intend to build a 50 megawatt electrolyser, powered by wind, to split water into hydrogen and oxygen gases without generating carbon emissions.
The partnership is part of a broader plan BP detailed in September to cut its oil and gas production by 40%, while increasing spending in low-carbon energy, including green hydrogen. It is targeting a 10% market share of hydrogen produced using renewables—or natural gas in cases where the emissions have been captured and stored—within the next decade.
Other oil companies also have plans to reduce emissions from hydrogen. Royal Dutch Shell PLC plans to increase its green hydrogen production 10-fold at its Rhineland refinery in Germany by 2030. Earlier this year, Repsol SA said it would build a fuel plant, which uses green hydrogen in Northern Spain.
