In a surprising turn of events, the Heide refinery has announced the abandonment of its green hydrogen project.

The refinery, known for producing liquefied petroleum gas, fuels, and heating oil, had ventured into green hydrogen production three years ago but cited high investment costs and economic risks as reasons for the project’s cancellation.

The collaborative effort, involving Raffinerie Heide, Ørsted Germany, and Hynamics Germany, had initially planned to build an electrolysis plant as part of the “West Coast 100 Living Lab” project. Unfortunately, the alliance disclosed in a joint press release that the venture was deemed financially inefficient for long-term operation.

The project, initially seen as a beacon of hope for integrating hydrogen into the energy mix, received significant support from the German government, securing 36 million euros in funding under the “Living Labs of the Energy Transition” program. The state government in Schleswig-Holstein was also a key backer of the initiative, making it an integral part of the country’s hydrogen strategy.

Stadtwerke Heide, set to participate in the project, had envisioned blending hydrogen with natural gas in a Heiden district. However, Andreas Hein, Chairman of the Supervisory Board of Stadtwerke Heide, expressed frustration with the lack of a legal framework for such projects, emphasizing that despite substantial funding, the hydrogen sector in Germany has seen little progress in the last three years. The setback raises questions about the challenges faced by ambitious hydrogen initiatives and the need for a supportive regulatory environment.