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Keila and Paldiski are working on becoming the Hydrogen Valley of Estonia

Two neighbouring cities in Estonia, Keila and Paldiski, are working together to be the pathfinders in creating the Hydrogen Valley next to the Baltic Sea.

As the European Union (EU) is aiming towards a climate-neutral Europe with the help of moving from fossil fuels over to renewable energy sources, the two cities are planning on starting a joint hydrogen hub (H2HUB). The hub brings together companies and local governments to achieve a common goal.

The population of the two municipalities combined is around 14,000. Despite the small numbers, Keila is the first city in Estonia to produce a hydrogen strategy. Paldiski is home to the main harbour for ro-ro ships designed for carrying wheeled cargo such as cars, trucks etc. to Estonia, which means a lot of the goods transported by sea enter the country through Paldiski.

If all goes according to the plan, soon the cities and their surrounding areas will be producing environmentally friendly hydrogen for public transport, production facilities and industry at large.

Hydrogen hub Keila: Size doesn’t always matter

Keila, the small picturesque city with small wooden houses, announced last summer that they have finished the work on the strategy of implementing hydrogen technologies and thus becoming the first city in Estonia with such a strategy.

A strongpoint of Keila is its location as it is only around 25 kilometres from Estonia’s capital Tallinn. Also, an important cargo port and industrial city of Paldiski is located next to it, meaning that an essential transport route and a railway used by passenger and freight trains go directly to Keila or pass by the city closely.

Keila is looking to reduce the city’s ecological footprint in the future and create energy systems that are independent of other networks. The first step would be the introduction of hydrogen in the transport sector. The initial vision is to introduce hydrogen-powered vehicles in local or regional bus transportation and later expanding these all over Estonia.

To turn those plans into reality, the town needs a local hydrogen fuelling station. This is also mentioned in the strategy but with a small twist – the aim is that the station will produce the hydrogen itself.

The former deputy mayor of Keila, Timo Suslov was the man behind the city’s ambitious plans. Although he is no longer a member of the local government, being a member of the Estonian parliament Riigikogu, Suslov is still keen on working on the strategy.

“We are not just thinking about implementing the use of hydrogen. We are looking for new, innovative and eco-friendly solutions. We are also happy to work with potential investors and entrepreneurs who have ideas we can turn into a reality,” Suslov said.

One of the most interesting ideas is to make the local wastewater treatment plant as emergency free as possible. Suslov sees that the plant can be turned into an autonomous water treatment plant based on hydrogen technology. In order to achieve this the plant needs to be equipped with solar panels that produce hydrogen.

“Water and sewage are the first-rate services, if they are interrupted, many problems occur,” Suslov added.

Being born and raised in Keila, Ivo Krustok is pleased that his hometown is thinking about hydrogen but also emphasises that only green hydrogen helps to meet climate and environmental goals set in the European Union.

Krustok is probably more environmentally conscious than an average person, as he is the climate adviser for the Ministry of Environment and the previous environmental counsellor for the Permanent Representation of Estonia to the EU. He sees that hydrogen will certainly play an important role as an energy carrier both in Estonia and in the world in the coming decades.

Suslov confirms that all the plans that Keila has are based on green hydrogen. Green hydrogen means that no fossil fuels are used to produce hydrogen but rather the wind or solar energy is employed. Up to now so-called gray hydrogen has mostly been used around the world that is made out of fossil fuels and is not environmentally friendly.

Paldiski solar park will produce green hydrogen

Paldiski is situated another 20 kilometres further from Tallinn. Parbo Juchnewitsch sees that Paldiski is becoming the green area for the development of energy and logistics in the Baltic Sea area. He manages the development of Puhkerand Logistics Center (PLC) with plans to run a solar park with capacity of 5.5 to 7.48 MW. To put it into layman terms – in an ideal world when the sun always shines, it would be possible to provide energy for at least 1600 households for one full year. But as the conditions vary and it heavily relies on many different factors the given figure is not carved into stone.

Solar parks that produce electricity are nothing new but solar parks which produce hydrogen are new and innovative.

“The need for hydrogen is growing massively. In addition to transport, the steel industry is likely to be an even bigger consumer, shifting from blast furnace fuel to hydrogen,” said Juchnewitsch.

Looking at other countries’ experience he points out that it is commercially more viable to run renewable energy projects together with companies and local governments with similar interests. To achieve that there have been discussions of establishing a Keila-Paldiski Hydrogen Hub (H2HUB).

The feasibility study run for PLC indicates that the payback period is around five to seven years. Their main clients would come from energy-intensive industries that want to reduce their footprint and lower the running costs. PLC is currently looking for investors to realise their plans.

According to the CEO of Paldiski Association of Entrepreneurs, Ester Tuiksoo, Paldiski’s energy storage project enables large-scale storage of renewable electricity, which can then be used to produce hydrogen.

The project has a unique synergy for the development of gaseous and synthetic fuels. In addition to hydrogen, the stored renewable electricity can be used to produce ammonia and synthetic liquid fuels. She added that in the future, the existing liquid fuel port terminals in Paldiski will also be used for logistics with synthetic liquid fuels.

“This synergy will make Paldiski a unique center in terms of the energy sources of the future, surpassing others in the region,” marked Tuiksoo.

The port in Paldiski is owned by Port of Tallinn. The company which operates many harbours and port terminals around Estonia, as well as passenger ferries connecting Estonia’s two biggest islands to the mainland, has ambitious plans on how to kickstart the usage of hydrogen at large in Estonia.

 Port of Paldiski

Estonia will be filled with hydrogen hubs

According to Sven Parkel, the head of the Estonian Hydrogen Cluster, Keila and Paldiski are not the only regions considering the possibilities of hydrogen. Hiiumaa, the second biggest island in Estonia, Tartu, Ida-Virumaa and Haapsalu are also interested but right now Keila is in the forefront.

Looking at the bigger picture, Parkel sees that the whole country needs to be filled with so-called hydrogen hubs to attend the needs of the regions. The regions he mentioned are on track to produce their studies or roadmaps. All of those hubs would rely on wind farms or solar parks that produce the energy needed locally.

“It’s not ideal to copy-paste ideas from one region to another. For example, Hiiumaa is looking to make ferries run on hydrogen. As Tartu is situated inland and there are no ferries, the focus point lies elsewhere,” Parkel noted.

Another benefit of green hydrogen lies in the increased energy security, meaning that the European Union cities can rely on energy that is produced locally.

Right now the cluster is working on an overall hydrogen usage vision for Estonia and Parkel is open to conversations with potential investors or other interested parties.

Anneli Hansen, the Director of Regional Business Development in North Estonia for Estonian Investment Agency, sees many possibilities and initiatives in the green energy sector of the Paldiski and Keila area. She also mentioned the importance of a bi-directional natural gas pipeline between Ingå, Finland and Paldiski, which connects Estonian and Finnish gas grids. The pipeline enables the construction of the regional liquefied natural gas (LNG) terminal in Paldiski.

“Now when Estonia is rapidly moving towards decarbonization of the country there are great opportunities for foreign investors to get on board this H2 driven train. Estonian Investment Agency and the Harju Entrepreneurship and Development Centre are helping the investors to receive needed information and get connected. We assist investors in their landing process and provide aftercare,” Hansen added.

The joint effort between the two Estonian cities and their plans outlined for the future will hopefully have a lasting impact not only on Estonia but on Europe in general. The usage of green hydrogen helps to realise the EU’s plans of becoming carbon neutral by 2050 and Estonia is proud to be contributing to achieving this goal.

Interested in investing in Estonia? Find out more about the country’s energy sector here and book a time via e-Consulting to speak to your personal advisor.

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