Schroders Greencoat and Carlton Power have announced the establishment of a joint venture company, Green Hydrogen Energy Company Ltd (GHECO), with the goal of accelerating the development of green hydrogen projects in the UK.
The partnership aims to build a project portfolio of 500 MW by 2030, contributing significantly to the UK’s hydrogen production capabilities, energy security, and Net Zero ambitions.
The initial projects in GHECO’s portfolio are planned to be located in Trafford (Greater Manchester), Barrow-in-Furness (Cumbria), and Langage (Devon). These projects have been shortlisted by the UK Department for Energy Security & Net Zero (DESNZ) to receive financial support from the Government’s Hydrogen Business Model/Net Zero Hydrogen Fund in the first Hydrogen Allocation Round (HAR1).
DESNZ envisions these projects to kickstart the low carbon hydrogen economy across the UK, aligning with the national target of having up to 1 GW of electrolytic hydrogen production capacity in operation or construction by 2025. To support the achievement of these targets, Schroders Greencoat and Carlton Power have committed an initial funding of £200 million to develop these projects and future initiatives within Carlton’s project pipeline.
Under the GHECO joint venture, Carlton Power will oversee the development, construction, and operation of current and future green hydrogen projects, while Schroders Greencoat will lead the financing efforts and leverage its expertise in UK renewable energy. Carlton Power aims to secure final agreements with DESNZ for the Trafford, Barrow, and Langage projects by the end of 2023 and plans to submit additional green hydrogen projects in Hydrogen Allocation Round 2 (HAR2).
The Trafford, Barrow, and Langage projects are projected to commence commercial operations in 2025, with HAR2 projects starting in 2026. Each project will supply green hydrogen to local industrial and manufacturing companies seeking to decarbonize their operations, with potential for supplying hydrogen to other businesses and local transport operators.
Keith Clarke, Founder & Chief Executive of Carlton Power, expressed excitement about the partnership, emphasizing the strength of Carlton’s projects, development strategy, and collaboration with blue-chip industry off-takers like Kimberly-Clark. Carlton Power aspires for GHECO to become the leading green hydrogen production company in the UK.
James Samworth, Partner and co-head of Schroders Greencoat’s Energy Transition team, outlined the ambition for GHECO to be one of the UK’s most significant hydrogen investment platforms. As a leading renewables investor in the country, Schroders Greencoat aims to accelerate the development of green hydrogen projects and provide investors with access to this growing industry.
The establishment of GHECO by Schroders Greencoat and Carlton Power signals a strong commitment to advancing the green hydrogen sector in the UK. With their combined expertise and resources, the partnership has the potential to drive significant progress in achieving the country’s hydrogen production goals and facilitating the transition to a cleaner, more sustainable energy future.