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Norwegian-German Collaboration on Green Energy: EnBW's Investment in Skipavika Green Ammonia

4 Sept 2023

EnBW Energie Baden-Württemberg AG (EnBW), a leading German energy company, has taken a significant step towards advancing green energy and hydrogen (H2) initiatives by entering into an Investment Agreement with Skipavika Green Ammonia (SkiGA), a cutting-edge project for emission-free ammonia production located in Western Norway.

This collaboration underscores EnBW's strong commitment to sustainable energy solutions and carbon-neutral hydrogen products, aligning with the climate goals of the European Union (EU), Germany, and Norway. EnBW has secured exclusive long-term offtake rights to green ammonia and solidified its dedication by acquiring a 10% equity stake in the Skipavika Green Ammonia project. This strategic investment by EnBW is pivotal in accelerating the project's journey towards a financial investment decision.

Green Ammonia: A Key Enabler of Decarbonization

Green Ammonia holds a pivotal role in advancing the hydrogen market and decarbonization efforts in various sectors, including industry and energy. It can be converted into hydrogen for use in heat and power generation or directly employed for these purposes, making it an ideal candidate for carbon-neutral electricity generation.

EnBW's involvement in the Skipavika Green Ammonia project equips the company to provide green ammonia for both its internal decarbonization initiatives and its customers, including the maritime sector, both locally and internationally. This agreement, conducted on commercial terms, signifies a breakthrough in commercializing hydrogen (H2) products like green ammonia, which play a central role in the EU's Green Deal.

Carbon-Neutral Electricity Generation with Green Ammonia

Peter Heydecker, Executive Director of Trading at EnBW, emphasized the company's commitment to becoming a carbon-neutral power generation leader. He highlighted the strategic significance of their collaboration with SkiGA, aligning with the goals of Germany, Norway, and the EU. The Nordic region, according to Heydecker, is poised to be a major supplier to Europe's carbon-free energy landscape, reinforcing its position as a reliable and stable energy partner for the continent.

The Skipavika Green Ammonia facility, slated to be located in Gulen municipality near Norway's Mongstad refinery on the west coast, is set to become Europe's inaugural emissions-free ammonia production site upon completion in 2026. The project has already secured grid connection and is engaged in advanced negotiations for Power Purchase Agreements (PPAs).

Cornel Russi, CEO of SkiGA, expressed the significance of EnBW's involvement in commercializing green ammonia and hailed it as a milestone towards a future carbon-free energy system. SkiGA's plant will boast an annual production capacity of 100,000 tonnes.

Competitive Collaboration for a Greener Energy Mix

The development of the Skipavika Green Ammonia project is spearheaded by Fuella AS, a Norwegian project developer specializing in hydrogen and ammonia projects. Notably, Allianz Capital Partners, on behalf of Allianz insurance companies, has committed to provide EUR 20 million in funding to support Fuella's project pipeline and business development, further solidifying the project's significance.

EnBW sees itself as a long-term partner in Norway's ambitious journey to develop the future energy mix, encompassing offshore wind, green hydrogen, and ammonia. The collaboration between Norway and Germany is expected to have far-reaching impacts on local, national, and international scales, making it a significant milestone in the transition to green energy.

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