The Guardian has learned that ScottishPower is to construct a £150 million green hydrogen plant in the Port of Felixstowe to power trains, lorries, and ships.

The energy business has drafted plans for a 100-megawatt facility at the Suffolk port that, beginning in 2026, will produce sufficient fuel to power 1,300 hydrogen-powered trucks.

The company, which is controlled by the €63bn Spanish utilities behemoth Iberdrola, stated that demand for the green fuel has increased since gasoline and diesel prices began to surge last year, encouraging the company to invest.

It has filed a proposal to the government’s Net Zero Hydrogen Fund, which gives funding for the next three years to create low-carbon hydrogen projects. ScottishPower anticipated that the entire project will cost between £100 million and £150 million.

ScottishPower is to construct the plant, which will be around the size of a football field, on brownfield property within the port, which is one of the busiest in the United Kingdom and a major commercial center.

Using renewable electricity to power an electrolyzer that separates water into hydrogen and oxygen yields green hydrogen. The combustion of the gas to make electricity emits just water vapor and warm air, but no greenhouse gases.

ScottishPower intends to provide hydrogen to the Port of Felixstowe, which is operated by Hutchison Ports, a subsidiary of Hong Kong-based multinational CK Hutchison.

The port is utilized by around 6,000 heavy cargo vehicles each year, and logistics companies are increasingly evaluating hydrogen as a way to reduce fuel costs and carbon emissions. The hydrogen will also be utilized to power the trains and ships that transport rail freight into the port.

ScottishPower, with its headquarters in Glasgow, already has substantial offshore windfarm holdings in East Anglia. Iberdrola holds the largest green hydrogen generation facility in Europe, located in Puertollano, Spain.

Barry Carruthers, the hydrogen director at ScottishPower, told the Guardian: “The strength of demand from the port itself, logistics and distribution companies and rail freight companies has given use the confidence to press ahead with this facility. This is a big, industrial scale project that we’re doing at pace. The cost of hydrogen is now comparable with diesel so this can be cheaper and cleaner for customers. The market has given us a really good glide path.”

ScottishPower is already in the midst of creating a smaller hydrogen facility at Whitelee, the biggest onshore windfarm in the United Kingdom, located near Glasgow, in collaboration with ITM Power of Sheffield. The 20MW electrolyser, which is projected to create hydrogen by next year, is anticipated to produce up to 8 tonnes of green hydrogen per day, which is about comparable to fueling 550 Glasgow-to-Edinburgh-and-back buses each day.

Carruthers stated that the Felixstowe location would also provide the ability to manufacture “green ammonia” from green hydrogen, which could subsequently be utilized as agricultural fertiliser.

Environmental activists have challenged plans for the £20 billion Sizewell C nuclear power project along the Suffolk coast.

But Carruthers said the proposed hydrogen plant “will not dominate the skyline” and is likely to be built within the grounds of the port. “For locals it should mean less diesel pollution and cleaner power for the trains and lorries in the area,” he said.