ITM Power (LON:ITM) has received a grant to install a 1.5Mw electrolyser on the Orkney Islands to convert excess electricity produced by wind turbines into hydrogen.
The energy storage group is part of the isolated territories Big Hit consortium, which will receive €5mln in total from the Fuel Cells and Hydrogen Joint Undertaking, an EU-funded body. ITM's share is €2.27mln for the electrolyser.
The Orkney Islands have more than 50Mw of installed wind, wave and tidal capacity and been a net exporter of electricity since 2013.
Hydrogen electrolysers are seen as one way to overcome the major drawback of renewable energy sources of matching demand with supply.
Turbines on Shapinsay and Eday, two of the Orkney islands, for example lose on average more than 30% of annual output when they are switched off due to grid capacity restrictions, said ITM.
Production of hydrogen from this curtailed energy by electrolysis of water gives 'green' hydrogen from renewable energy sources with a very low carbon footprint,it added.
Big Hit will enable the deployment of 10 electric vans, which will each be fitted with a hydrogen fuel cell range extender. A hydrogen refuelling station will be constructed in or near to Kirkwall.
Big Hit will also install two hydrogen-powered boilers to provide zero carbon heat.
Graham Cooley, ITM’s chief executive, said: "Big Hit is a major step in turning the Orkney Islands into a genuine hydrogen territory.
“The deployment of 1.5MW of electrolysis and the operation of hydrogen logistics to provide a transport fuel and renewable heat is a very important part of that process."
Hydrogen fuel cells produce electricity, heat and water. Electricity produced by the fuel cell is used to charge the battery and drive the motor.