Technical due diligence in hydrogen and derivatives projects
Technical and Lender Technical Due Diligence services offered by DNV provide assurance on the underlying assumptions for a wide variety of projects.
DNV is a global, independent and recognized technical advisor providing technical and commercial due diligence services to project developers, investors and lenders.
In its objective and independent role, Technical Due Diligences (TDDs) are relevant services offered by DNV to provide assurance on the underlying assumptions for a wide variety of projects (from renewable hydrogen production to conversion into derivatives such as green ammonia, methanol, SAF, HVOs, etc.), adding rigour, soundness and credibility to the initiative, which is paramount for stakeholders and lenders to move the project to the next stage.
Regardless of the project phase you are facing, DNV can support and perform TDDs and independent advisory services using a holistic approach with risk assessment covering a wide range of disciplines and experts across the entire value chain.
Our service
At the customer's request, DNV will prepare a tailor-made proposal to meet the customer specific needs, which will usually involve a review of the project's existing documentation including contracts, models and assumptions.
The objective of such a document is to provide comfort to the seller/buyer by identifying the risks associated with the status of the project and to provide expert advice. This means not only identifying the risks but also proposing mitigation measures to downgrade or eliminate them.
The scope of Hydrogen/Derivative Technical Due Diligence project usually includes:
- Review of permitting status of the project and site conditions
- Technology review: It consists of checking each of the blocks and assets involved in the project whilst ensuring coherence in the interfacing upstream and downstream processes
- Revision of Engineering documentation package regardless of the project phase from scoping conceptual design (FEL-1) to detailed engineering (FEL-3)
- Revision of OEM, O&M, EPC, PPAs, HPAs and other relevant contracts
- Assessment of technical dispatch and financial models
- Other.
The due diligence report will provide a detailed overview of the project plus risk assessment tables including, for each item identified, their description, implications, probability/impact scoring and mitigation strategies.
Our expertise
DNV is uniquely positioned in the hydrogen value chain as a result of our domain expertise of the Power and Renewables, Oil & Gas and Maritime sectors, covering hydrogen production, transportation, storage and end-uses. DNV experts and consultants from all our business areas have a long legacy within hydrogen and have for the past years been involved in several hydrogen roadmap projects, assessing scenarios for hydrogen market development related to emission targets, policies and realistic technology development. This includes analyses of hydrogen production, transport, supply and demand, infrastructure investment needs, technical and economic development for whole value chains and the roll-out for potential hydrogen usage. Our experts have been involved in hydrogen business case modelling and scenarios for specific locations (like harbors and bus depots), but also regions (e.g. industrial clusters), nations and on a global scale.
In particular, DNV has reviewed more than 20 GW of nominal capacity of electrolysis in the last three years in different TDDs including the renewable power upstream as well as the required derivatives plants downstream.
