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Spain is stepping up efforts to enter the race to build a hydrogen industry, putting it on par with France and Germany in the search for greener fuel for heavy industry.
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Madrid’s government has a roadmap to build 4 gigawatts of green hydrogen capacity by 2030 and is expected to announce Cabinet approval of the program on Tuesday, according to Sara Aagesen, Secretary of State for Energy. The program would require an investment of 8.9 billion euros ($ 10.5 billion) over the next decade.
“Things are getting very competitive,” Aagesen said in an interview on Monday. “Spain has the capacity to become a major player in the renewable hydrogen sector by taking advantage of our strong potential to produce renewable energy at very competitive prices.”
The European Union has placed hydrogen at the heart of its measures to reduce greenhouse gas emissions by at least 55% by 2030 and become climate neutral by 2050. Hydrogen, if it is made from renewable energy, could replace oil, natural gas and coal and help eliminate about a third of emissions from industries like steel and cement by mid-century, according to BloombergNEF. Green hydrogen production processes are not yet economically viable without government support.Spain’s plan includes 60 measures that will help establish a hydrogen supply chain, according to a government document seen by Bloomberg. The roadmap targets manufacturing plants with a capacity of 300 to 600 megawatts of hydrogen from renewable energy by 2024 and 4 gigawatts by 2030. This would represent 10% of the target of the EU, which is 40 gigawatts by 2030. Spain plans to start measuring hydrogen production by energy source and review targets at least every three years.
The government has yet to establish how much of the needed € 8.9 billion will be state funded, Aagesen said. He wants 25% of the hydrogen used for industrial purposes to be made from renewable energy by 2030, a green hydrogen fleet of 150 buses, 5,000 light and heavy vehicles, two commercial train lines and the installation of at least 100 hydrogen fueling stations hydrogen handling machines in the five main ports and airports of the country.
Electrolysers, machines powered by electricity that separate the hydrogen atoms in water from oxygen, are key to scaling up green hydrogen. At present, electrolysers in Spain have the capacity to produce around 2.7 megawatts of hydrogen. The plan includes a goal to build large-scale units that can each produce up to 100 megawatts.
Although the focus is on industry and local transport in the short to medium term, the plan mentions Spain’s potential to become an exporter of clean gas to the rest of Europe. Germany and the Netherlands have said they do not expect to create enough renewable energy capacity to power all the clean hydrogen they will need, effectively making them long-term importers.
“By 2050, there are good prospects for a market like Spain to export to Germany, if all parts of the puzzle come together,” said Emma Champion, energy transition policy analyst at BloombergNEF . Spain has 61.2 gigawatts of renewable energy capacity – including wind, solar, biomass and hydropower – and targets an additional 60 gigawatts by 2030.
In comparison, France is looking for 6.5 gigawatts of green hydrogen by 2030 and Germany is looking for 5 gigawatts the same year. France’s plan calls for public spending of € 7 billion over the next decade. Germany would invest 9 billion euros until 2040.
“The level of ambition in Europe is very promising if it can be achieved,” said Champion. “Who makes up the rest is always the big question.”
According to BNEF, the industry needs $ 150 billion in subsidies by 2030 to grow and $ 11 trillion in investment by 2050 to enable hydrogen to meet 24% of the demand for it. energy by 2050. Changes in the economics of the energy sector would help – especially if the cost of producing hydrogen drops and pollution compensation become more expensive.
“There is a long road ahead of us,” Aagesen said. “But the political will is there. The goal is on the table and I don’t think the hydrogen strategy will slow down. We have seen that some sectors are really difficult to decarbonize without renewable hydrogen. ”
– With the help of Will Mathis and Jeremy Hodges