Neste Re-evaluates Hydrogen Strategy, Withdraws 120 MW Electrolyzer Investment at Porvoo

Neste has decided to step back from investing in a planned 120 MW electrolyzer project aimed at generating renewable hydrogen at its Porvoo refinery in Finland. This decision comes after the basic engineering phase was completed, which began in May 2023. The company cites challenging market conditions and its current financial performance as reasons for reevaluating this investment.

A significant factor influencing Neste's withdrawal is the restriction on renewable hydrogen use in the refinery’s processes, specifically in meeting Finland's national distribution obligations. These limitations make it difficult to economically justify an electrolyzer of this scale at the Porvoo refinery, as its full potential cannot be utilized under the current regulatory framework.

Despite this project’s discontinuation, Neste remains committed to integrating renewable hydrogen at its Porvoo facility. According to Markku Korvenranta, Neste’s Executive Vice President for Oil Products, the company is exploring alternative methods to secure renewable hydrogen, aiming to contribute to the Finnish distribution obligations for renewable fuels of non-biological origin (RFNBO). Neste plans to continue working alongside partners to develop hydrogen ecosystems that can support Porvoo’s renewable energy goals.

Neste's decision highlights the complexities of renewable energy investments, where economic feasibility, regulatory conditions, and market dynamics all play crucial roles in shaping project viability.

Neste is dedicated to using science and innovative technology to transform waste and other resources into renewable fuels and circular materials, providing solutions to address climate change and promote a shift toward a circular economy. As the world’s leading producer of sustainable aviation fuel (SAF) and renewable diesel, Neste is at the forefront of developing renewable and circular feedstock solutions for polymers and chemicals. This leadership in sustainable solutions aligns with Neste's mission to help its customers reduce their greenhouse gas emissions by at least 20 million tons per year by 2030, making a measurable impact on global emissions reduction efforts.

A key focus for Neste is its ambitious plan to transform its Porvoo oil refinery in Finland into the most sustainable refinery in Europe. The company has committed to achieving carbon-neutral production by 2035, alongside a goal to reduce the carbon intensity of its sold products by 50% by 2040. Neste also prioritizes high standards for biodiversity, human rights, and responsible supply chain management, reinforcing its broader commitment to sustainable practices across its operations.

Neste’s sustainability efforts have consistently earned it recognition on global sustainability indices, including the CDP and Dow Jones Sustainability Index (DJSI), highlighting its position as one of the world’s most sustainable companies. In 2023, Neste reported a revenue of EUR 22.9 billion, reflecting its robust business performance alongside its sustainability commitments. Through these initiatives, Neste aims to be a leader in sustainable energy solutions and a key player in the transition to a low-carbon, circular economy.