Statkraft Unveils Ambitious 400MW Green Hydrogen Vision for Shetland

Image Credit: Statkraft

Norwegian renewable energy giant Statkraft has secured a land lease from the Shetland Islands Council, officially moving its Shetland Hydrogen Project 2 into the next phase of development. The planned facility, situated adjacent to the now-defunct Scatsta Airport, will have the capacity to produce green ammonia utilising up to 400 megawatts of electrolytic hydrogen. The site is located near the well-known Sullom Voe Oil Terminal and the Shetland Gas Plant, two key pillars of the region's energy infrastructure.

Once operational, the facility is expected to supply green ammonia to a broad range of industries. This includes providing a sustainable fuel alternative for marine shipping and helping to reduce emissions from fertiliser production, a sector under increasing pressure to decarbonise.

“The construction of schemes like Shetland Hydrogen Project 2 will allow excess renewable power that cannot be utilised by the grid to be transformed into hydrogen,” the company said.

Notably, Statkraft has three wind farms on Shetland in pre-construction: Mossy Hill near Lerwick, and Energy Isles and Beaw Field on Yell.

Stuart Marley, Statkraft’s Principal Hydrogen Project Manager, stated: “This is an exciting milestone for the potential to develop green hydrogen and ammonia production in Shetland. This scheme offers an opportunity to combine Shetland’s renewable resources with innovative technology.”

“The historic links with energy production mean there is a wealth of talent in the region to draw on to ensure projects are run safely and efficiently. While we are currently in the early stages of development, we will work closely with local stakeholders and the wider Shetland community as we progress this project.”

What makes this announcement particularly notable is the context in which it arrives. Earlier in 2025, Statkraft made headlines when it paused the development of new green hydrogen projects. At the time, the company stated that, although it would not actively pursue additional developments, it would continue to advance select existing projects in anticipation of future investment opportunities. Even then, Statkraft remained steadfast in its long-term commitment to green hydrogen, describing the technology as a crucial part of its broader strategy.

Not long after that announcement, Statkraft entered into an option agreement with Clydeport. Clydeport is a part of the Peel Ports Group, one of the UK's largest port operators. The agreement focused on exploring the feasibility of a green hydrogen facility at the Hunterston Port and Resource Campus in Scotland. That exploration is still ongoing and represents another piece of Statkraft's growing hydrogen portfolio.

The Shetland Hydrogen Project 2 marks a clear continuation of this approach — a selective advancement rather than a full retreat. For Statkraft, the green hydrogen journey appears to be far from over.