Sweden – Ørsted has made a final investment decision (FID) on the FlagshipONE e-methanol project, which will produce 50,000 tonnes of e-methanol per year.
FlagshipONE will be Ørsted’s first commercial-scale Power-to-X facility and a major step toward Ørsted’s goal of being a leader in renewable hydrogen and green fuels. Reinforcing the commitment to the FID, Ørsted has taken full control of FlagshipONE by acquiring the remaining 55% investment in the project from Liquid Wind AB, the original developer of the project.
FlagshipONE, located in Örnsköldsvik, Northern Sweden, is Europe’s largest FID’ed green e-methanol facility. FlagshipONE is scheduled to begin operations in 2025 and will produce around 50,000 tonnes of e-methanol per year to aid in the decarbonization of the global shipping industry.
World shipping contributes for around 3% of global carbon emissions, and the sector is a priority for Ørsted as it increases its position in Power-to-X across Northern Europe and the United States. FlagshipONE is the first e-methanol project in Ørsted’s ambitious green fuels pipeline; the company is also developing the 300,000-tonne ‘Project Star’ in the US Gulf Coast area, as well as the ‘Green Fuels for Denmark’ project in Copenhagen, both of which will produce significant volumes of e-methanol to enable shipping decarbonization.
Green fuels for shipping now cost more than their fossil-based counterparts, and the sector needs supportive policy to encourage demand and accelerate the maturation of green fuels. Until this rule is implemented, e-methanol pricing, even from world-class Power-to-X assets like FlagshipONE, is subject to significant uncertainty – and large-scale offtake appetite has yet to arise. Ørsted is ready to lead the development of the Power-to-X industry and take risks in the process, including by pushing strategic projects like FlagshipONE, but legislative action that matches the goals of developers and shipping firms is urgently required.
FlagshipONE will begin building on-site in the spring of 2023, according to Ørsted. The project will be located on the grounds of the biomass-fired combined heat and power plant Hörneborgsverket in Örnsköldsvik, run by Övik Energi. FlagshipONE’s e-methanol will be created with renewable electricity and biogenic carbon dioxide gathered from Hörneborgsverket. Furthermore, Hörneborgsverket will supply steam, process water, and cooling water to FlagshipONE. Excess heat from the e-methanol production process will be given back to Övik Energi and integrated in their district heating supply.