BP Drops UK Hydrogen Plan Amid Site Clash With Data Center
(Bloomberg) -- BP Plc is abandoning plans to proceed with its big Teesside hydrogen plant in England’s northeast, after the project clashed with a proposal for a large data center on the same site.
A planning application granted by local authorities for a data center on the same piece of land has now rendered the two projects “incompatible,” BP said in a letter to the UK regulator. The British energy giant also cited deteriorating demand. The company said it still expects to move ahead with its gas-fired power station with carbon capture at Teesside, as well as a regional carbon storage scheme.
BP’s hydrogen reversal comes as the company early this year pivoted its strategic direction back to oil and gas from a failed multi-year bet on low-carbon ventures. Over the last year the company has spun off its global offshore wind portfolio, sold US onshore wind assets, exited Australia’s massive green hydrogen hub and halted plans for a Dutch biofuels plant.
The decision to scrap the hydrogen plan was BP’s and the UK government “continues to provide a route for hydrogen projects in Teesside,” a Department of Energy Security and Net Zero spokesperson said in a statement.
The hydrogen “demand situation in Teesside has also deteriorated as some major industrial consumers have either scaled back operations or postponed decarbonisation plans, significantly increasing” BP’s risk, the company said in the letter to the regulator.
Data centers aren’t the only facilities competing for land in northern England. Teesside is among 13 potential sites under consideration for new munitions factories.
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