"It's difficult to imagine a serious energy company not getting involved in renewable energy."
Why should a producer of oil, gas and hydro-electric power invest in alternative energy?
Jørgen Rostrup, who is in charge of Hydro’s Renewables and Hydrogen unit, an amalgamation of the former units Wind power, Hydrogen and Norsk Hydro Technology Ventures, replies to this question by describing the global greenhouse gas problem.
He mentions the Kyoto agreement and the EU target of doubling the proportion of renewable energy in the total EU energy consumption in 2010. He adds that a large oil and gas producer such as Hydro cannot refrain from getting involved in these questions.
For Hydro, getting involved means investing in wind power and hydrogen.
The company’s first windmill park came into operation at Havøygavlen in Finnmark, Northern Norway, in the autumn of 2002; Hydro is the second largest owner with a 41.5 percent interest. Of the other wind power projects that are in the pipeline, Harbakkfjellet in Sør-Trøndelag, Mid-Norway has come the furthest. The planned capacity of this windmill park is twice as great as the Havøygavlen project, which has 16 wind turbines and a total capacity of 40 megawatt.
Not just in Norway
Hydro is also looking into wind power projects in other countries.
"We are also looking into the possibilities of building wind power plants on Hydro’s factory sites in Germany. In addition to supplying electricity to Hydro, which is a major consumer, a significant amount of power could also be delivered to the net," says Rostrup.
He adds that the lack of incentives is a drawback for those who wish to invest in wind power in Norway.
"The wind power park in the north of Norway was based on the sale of green certificates to other countries, mainly the Netherlands. It is, therefore, a positive sign that the Storting (the Norwegian parliament) has asked the government to look into introducing green certificates in 2005. We support this initiative; the certificate market can play an important part in phasing in new technology in collaboration with other countries."
Hydro and hydrogen
The other focus area is hydrogen, which is now generally regarded as one of the major energy carriers of the future. Here Hydro has a particularly good departure point, both as fertilizer producer and manufacturer of electrolysers. Hydrogen is produced in the company’s ammonia plants through the reformation of natural gas, while the subsidiary Norsk Hydro Electrolysers in Notodden produces electrolysers that are used to produce hydrogen through the electrolysis of water.
Hydro has invested a good deal in recent years in the development of hydrogen projects. Two projects stand out in particular – the island energy project on Utsira and the public transport project in Iceland.
"The hydrogen filling station that opened recently in Iceland is the first at a commercial filling station. It has aroused considerable international attention and similar stations will be built in Hamburg and Berlin," he points out.
A hydrogen-driven car with a low-temperature fuel cell is pollution free; the only emission is water. The technical challenge has been to produce suitable fuel cells for transforming hydrogen into electricity in the car’s electric motor. The vision is now becoming reality.
The collaboration project in Iceland also involves Shell, Icelandic Holding Company VistOrka hf and DaimlerChrysler.
The island of Utsira
Utsira is a small island community of around 240 inhabitants, 18 kilometres west of Haugesund, where Hydro together with Enercon will start a much publicized wind power and hydrogen plant.
"This will show that it is possible to supply energy to remote areas with poor electricity infrastructure. But good wind conditions are a necessity," says Rostrup. At present Utsira’s power is provided via a cable from the mainland, but the island has the long-term goal of supplying its own electricity.”
This research and development project is based on two wind turbines, an electrolyser, a hydrogen storage unit and a fuel cell. The demonstration project is planned to run for two years.
What is worth focusing on?
In addition to the main areas wind power and hydrogen, the renewable energy and hydrogen unit also assesses investment opportunities in renewable energy and distributed power generation. Enquiries from entrepreneurs and technology companies are many – Rostrup estimates that as many as 200 proposals are sent to Hydro every year. So far, eight projects, including wave power, have been accepted.
One of the values of these projects, where Hydro’s ownership interest is small, is that they give the company insight into advances in energy technologies.
"We don’t invest in these projects solely for the financial return, but also to increase our knowledge," says Rostrup. "A lot of research and development in this area takes place outside the major companies."
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