As Europe seeks to move away from fossil fuels, Spain is rushing green hydrogen development, aided by a growing wind and solar complex as part of efforts to decarbonise its economy.
Spain accounted for 20% of green hydrogen projects worldwide in the first quarter, just behind the United States, which is home to more than half, according to consultancy Wood Mackenzie.
“A lot of countries are interested in green hydrogen, but in Spain the sector has accelerated rapidly” in recent months, said Rafael Cossent, associate research professor of energy economics at the Pontifical University Comillas. from Madrid.
The sector is still in its infancy, but the war in Ukraine has prompted the European Union to double its production target for 2030 as part of efforts to reduce its dependence on Russian energy supplies.
“Spain has become a very attractive country for green hydrogen,” EU chief Ursula von der Leyen said during a visit to the country in May. “A shift is happening…towards competitive hydrogen at scale.”
Green hydrogen is produced by passing an electric current through water to separate it into hydrogen and oxygen, a process called electrolysis. It is considered green because the electricity comes from renewable energy sources which create no harmful emissions.
And while fossil fuels emit harmful greenhouse gases when burned, hydrogen only emits harmless water vapour.
This technology is part of the EU’s efforts to become climate neutral by 2050.
– ‘Great potential’ –
Green hydrogen could replace coal in heavy industries such as steel mills. It can also be used to make fertilizer and is seen as a potential fuel for buses, trains and planes in the future.
A major drawback of green hydrogen, however, has been the high cost of producing it. It is much cheaper to manufacture “grey” hydrogen, but its production requires the use of fossil fuels which emit greenhouse gases.
But technological advances and soaring fossil fuel prices have made green hydrogen more competitive.
Spain has “great potential” as it has a well-developed renewable energy sector, with significant solar and wind resources, said Javier Brey, president of the Spanish Hydrogen Association (AeH2).
Cossent said Spain has another advantage in its extensive natural gas network and LNG terminals, which could be transformed to export hydrogen.
The government last year launched a 1.5 billion euro ($1.8 billion) plan to support green hydrogen projects over the next three years, drawing on a Covid stimulus fund of the European Union to do so.
Adding private investment, nearly nine billion euros will be spent by 2030.
– Future energy hub? –
Spanish energy companies like Iberdrola, Repsol and Enagas have all launched green hydrogen projects.
Enagas has teamed up with global steel giant ArcelorMittal and fertilizer maker Fertiberia for a huge project dubbed HyDeal Espana in the northern region of Asturias.
The site will have about fifteen solar parks which could produce 330,000 tonnes of hydrogen per year by 2030, making it the largest project of this type in the world, according to the International Renewable Energy Agency.
“It shows that the industry has matured,” AeH2’s Brey said. “2030 may seem far away, but in reality it’s tomorrow.”
Spain “has all the cards in hand to become an energy hub”, he added.
But the country still has a few hurdles to clear before it can become a leader in the booming industry.
“To win, Spain will have to accelerate the deployment of solar and wind farms, because electrolysis consumes a lot of electricity,” Cossent said, adding that the projects were stuck in “administrative bottlenecks”.
Spain also lacks energy connectivity with the rest of Europe, but the government has relaunched a gas pipeline project linking Catalonia and France, which Madrid wants to use to ship hydrogen.