The electrolyser will be installed near the Piesteritz agro-chemical park and located opposite SKW Piesteritz, one of the potential off-takers of project GreenRoot.
Together, Leipzig-based VNG, its wholly owned gas trading subsidiary VNG Handel & Vertrieb (VNG H&V) and the Dutch firm HyCC, plan to begin the approval and consultation phase of the project in 2025, take a final investment decision in 2026, and begin operations in 2029.
While the companies have not confirmed if the full 500MW capacity will be operational by 2029, achieving this would position the project among Germany’s largest green hydrogen production facilities.
Furthermore, it’s expected that the initiative will be connected to the nation’s hydrogen core network, which received the green light to begin construction last October (2024). The parties will also “look into possible synergies to deliver heat from the plant to the municipal utility company of Lutherstadt Wittenberg.
VNG and its H&V subsidiary have taken up roles as project experts and HyCC is anticipated to “contribute valuable expertise” in the electrolysis field.
“The domestic production of green hydrogen in cooperation with our partners and our local customers should strengthen the Central Germany region as an important industrial location and pave the way for sustainable value creation in the region,” explained Konstantin von Oldenburg, Managing Director of VNG H&V.
“We therefore advocate that the EU Commission makes the criteria for defining green hydrogen more flexible and deregulate it as soon as possible. In addition, the funding instrument of the Climate Protection Agreement should be further strengthened and made more pragmatic by the German federal government.”
The Managing Director added, “In our view, a sustainable stabilisation of the greenhouse gas quotas through a triple credit for green hydrogen and an exemption from network charges for electrolysers beyond 2030 would also be important for this.”
Ulf Heitmüller, CEO of VNG, reiterated that projects such as GreenRoot require “investments that we can only manage if they are economically viable.”
The CEO continued, For successful implementation, we therefore also need economic conditions and regulations that enable us to produce green hydrogen at competitive prices and support the use of hydrogen by our customers. We still need to work together on this.”
Despite the recent collapse of the German three-party coalition government, the potential of the nation’s hydrogen industry remains robust according to Charles River Associates’ (CRA) Dieter Keller-Giessbach.
“Any political imbalance is unfavourable for major transformation projects such as the hydrogen ramp-up in Germany,” explained the CRA Vice-President. “[Although], the most important subsidy regulations are on their way and cannot be stopped just because of a looming new election.”
