Essar Group has created a joint venture with Progressive Energy of the United Kingdom to spend $1.34 billion on a hydrogen manufacturing plant at its Essar Stanlow refinery complex.

From 2026 onwards, the joint venture, Vertex Hydrogen, would generate 1 gigawatt (GW) of hydrogen per year from two units, according to Essar.

Tata Chemicals, Encirc, InterGen, Solvay, Ingevity, Novelis, Glass Futures, and Saica Paper have already indicated an interest in purchasing hydrogen from Vertex, according to Essar, which controls 90% of the company.

To minimize the use of natural gas in the UK’s energy mix, the government plans to build 5 gigawatts (GW) of low-carbon hydrogen plants by 2030.

Industry and policymakers are increasingly looking to hydrogen to minimize the environmental impact of sectors that have been the most difficult to decarbonize and reduce the use of gas, but the needed investment and technological obstacles are significant.

The United Kingdom wants to replace up to a fifth of its natural gas with “green” hydrogen, which is made from natural gas and steam. Blue hydrogen, unlike green hydrogen, does not produce zero emissions, but the carbon emissions are absorbed, stored, and utilized in other ways.