Financing a world scale hydrogen export project: Paper

It is anticipated that green hydrogen will require government support for the next 15-20 years and that green hydrogen export projects will have to compete, largely on delivered price, to supply the demand created by the importing government programmes.  Efficient project financing, both debt and equity, can play an important part in minimising the cost. This paper by Stephen Craen, Visiting Research Fellow, Oxford Institute for Energy Studies considers a 1GW archetype project, using solar power to export green hydrogen in the form of green ammonia, and considers the key issues that will impact its ability to attract low-cost debt.

Lenders will look at precedents and, while ostensibly green ammonia has much in common with LNG, economically the better analogue is offshore wind given the requirement for government support, the expectation that future projects will offer a lower levelized cost of hydrogen (LCOH) and that contract prices are more likely to be fixed than indexed to fossil fuels.

Access the paper here