Three project withdrawals seen from UK’s HAR1 scheme

LONDON (ICIS)–Three projects voluntarily withdrew from the UK government’s first electrolytic allocation round (HAR1) scheme with two of the three companies giving different reasons as to the withdrawal.

The UK government’s Hydrogen Business Model/Net Zero Hydrogen Fund announced 16 August that 17 projects totalling 262MW of capacity have been shortlisted for further negotiations.

THREE WITHDRAWALS

In a press release 16 August, Dolphyn Hydrogen said that it was withdrawing its single-unit demonstrator application under the HAR1 scheme “to secure alternative funding for a phased multi-unit larger development.”

“Dolphyn will focus now on an opportunity to advance the Dolphyn demonstrator within a larger commercial scale project, where the demonstrator forms phase 1 of the roll-out. To facilitate this accelerated approach, we will be moving the location of the demonstrator to a site that will allow expansion at a single location.”

A spokesperson from Phillips 66 and Orsted told ICIS that “we have made a joint decision to withdraw our bid from the funding process and pause the Gigastack project…further project maturation together with supply chain development is required to unlock the maximum potential of this world-scale electrolytic hydrogen project.”

Inovyn ChlorVinyls, who chose to withdraw the Quill 2 project from HAR1, had not responded by the time of writing after being contacted by ICIS.

NEXT STEPS

The 17 projects will now engage in negotiations with the UK government for specific funding arrangements.

There is a maximum grant funding intensity for projects of 20% of total capex (capital expenditure).

HAR2 will be launched in the final quarter of this year and aims to award contracts of up to 750MW of capacity in early 2025.

ICIS asked the UK government for additional details surrounding the HAR1 allocation, but the government has not responded by the time of writing.