Questions have been raised over an apparent delay to an investment decision for the Aberdeen Hydrogen Hub being developed by the city council and oil giant BP.
The joint venture, which is receiving taxpayer money for the project, said in November that a key final investment decision (FID) was still expected in 2023 after planning was approved in June – it had previously been earmarked for early 2023.
Asked about the delay, a BP-Aberdeen spokesperson said the project was going through due diligence, but did not elaborate further. The ruling SNP-Lib Dem council administration did not respond to a request for comment.
Aberdeen Labour opposition councillor Tauqeer Malik said his “worry” is the group has ran into difficulties over their financial involvement.
During an October Urgent business committee he moved to have the project referred to Audit Scotland.
He said: “I moved an amendment noting the risks and assumptions as outlined in the Outline/Full Business Case which includes, but are not limited to, risk and reward on council funds invested.
“It is my worry that the SNP have run into difficulties with BP over their and council’s financial involvement.
“I will be writing to Angela Scott (Aberdeen City Council’s) chief executive on this matter, but it is disappointing having handed the SNP an opportunity to work with BP on a gold plate before leaving office in May 22 this project appears to no longer to be moving forward at pace.”
Committed funding
The Scottish Government has made a multi-year commitment of £15m towards the project.
BP and Aberdeen City Council said in March 2022 that they had committed £3m towards early design works.
In budget talks last year, the local authority said it had also committed £1.98m of funding to the joint venture company to support the development of phase one.
An invitation to tender by Aberdeen City Council put the overall price tag at £215m for all three phases of the project. The split of costs has not been made public.
BP and Aberdeen City Council have been planning first production of hydrogen in 2025.
On the investment decision, a BP Aberdeen Hydrogen Energy spokesperson said: “We’re still working towards FID, going through the necessary due diligence to reach this decision.”
A Scottish Government spokesperson said: “Scotland has the potential to be a globally leading hydrogen nation and the Scottish Government is fully committed to helping our hydrogen sector develop and grow, supporting a just energy transition for the highly skilled workforce in the north east of Scotland and beyond.
“The Scottish Government is providing multi-year support to the Aberdeen Hydrogen Hub through our Energy Transition Fund. This has delivered more than £6.5m of investment spending so far, including in the city’s hydrogen bus fleet. Our investment in the Hub is ongoing and we continue to work closely with partners on the project.”
Three phases
Land at Hareness Road, at Altens Industrial Park in Aberdeen, has been earmarked for the hydrogen production facility, while the proposed solar farm will be on the former Ness landfill site.
That phase will deliver over 800 kilograms of green hydrogen per day, enough to fuel 25 buses and a similar number of other fleet vehicles.
Phase Two envisages supply to larger-volume utilisation hydrogen vehicles such as rail, freight and marine. Phase Three will involve the supply of hydrogen for heat and export.
