Funding for Shetland clean fuels hub

The development of a clean fuels hub on Shetland will get financial backing from the Scottish Government, Energy Minister Stephen Gethins announced ahead of a visit to Sullom Voe Terminal.

Veri Energy will receive almost £760,000 to support the third phase of work to develop the hub. When it comes into operation by 2030, it is expected to produce hydrogen and e-methanol, with manufacturing capacity scaling up into the following decade.

Work to establish the hub will retain and retrain skilled oil and gas workers, support local businesses and contribute to the development of clean fuels manufacturing expertise in Scotland. It will also pave the way towards supplying e-methanol to a proposed sustainable aviation fuel plant on the site of the former refinery at Grangemouth.

The Energy Minister said:

“Sullom Voe Terminal is a crucial part of Scotland’s industrial landscape. It has been at the heart of Shetland’s economy for many years, providing vital jobs and supporting local businesses, and I welcome the opportunity to tour such a significant site.

“We know it has faced challenges recently because of reduced activity, so it is absolutely correct that we help where we can in order to secure a viable future for its valued workers. That is why the Scottish Government is contributing almost £760,000 to support Veri Energy as it continues to develop its ambitious plans for a clean fuels hub.

“We need an approach to our energy future that sees us manage oil and gas activity while seizing the opportunities that come from increasing the deployment of new technologies and fuel sources. Our renewables revolution has been two decades in the making, and the economic opportunities from what comes next could be transformational.

"That transformation needs to benefit communities right across Scotland, delivering jobs, energy security and growth –  Shetland and our island communities have a vital role to play in this process. Shetland has been a vital part of Europe's security for decades and will continue to be for decades to come.”

Veri Energy Chief Executive Gavin Templeton said: 

“This support from the Scottish Government is a strong endorsement of the strategic opportunity at Sullom Voe. Our clean fuels hub has the potential to transform nationally significant existing energy infrastructure into a platform for the production of e-fuel at scale, creating long-term economic value for Shetland and contributing to Scotland’s net-zero ambitions.

“The project will build on the skills, experience and industrial heritage of the region while helping establish a new centre of expertise in clean fuels manufacturing. We continue to engage and work with the SVT owners and are excited to take this next step and to work with stakeholders across Scotland to realise the full potential of the opportunity.”

Background

The Scottish Government will provide £755,720 to support phase 3 of Veri Energy’s work to establish a clean fuels hub at Sullom Voe Terminal. The company and other partners will provide additional support.

Phases 1 and 2 were funded by Veri Energy and the Net Zero Technology Centre at a total cost of £2.2 million.