As Europe seeks to move away from fossil fuels, Spain is rushing to develop green hydrogen, aided by a growing wind and solar power complex in efforts to decarbonize its economy.
Spain accounted for 20 percent of global green hydrogen projects in the first quarter, second only to the United States, which is home to more than half of them, according to consultancy Wood Mackenzie.
“Many countries are interested in green hydrogen, but in Spain the sector has accelerated rapidly in recent months,” said Rafael Cossent, associate scientific professor of energy economics at the Comillas Pontifical University in 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 to reduce its dependence on Russian energy supplies.
“Spain has become a very attractive country for green hydrogen,” said EU boss Ursula von der Leyen during a visit to the country in May. “There is a shift happening…toward competitive, mass-scale hydrogen”.
Green hydrogen is made by passing an electric current through water to break it down into hydrogen and oxygen, a process called electrolysis. It is considered green because the electricity comes from renewable energy sources that do not cause harmful emissions.
And while fossil fuels emit harmful greenhouse gases when burned, hydrogen only emits harmless water vapour.
The technology is part of the EU effort to become carbon neutral by 2050.
– ‘Big potential’ –
Green hydrogen could replace coal in heavy industries like steel mills. It can also be used to make fertilizer and is considered a potential fuel for future buses, trains and planes.
However, a major disadvantage of green hydrogen is the high production costs. It is much cheaper to produce “grey” hydrogen, but its production requires the use of fossil fuels that emit greenhouse gases.
But advances in technology and increases in the price of fossil fuels have made green hydrogen more competitive.
Spain has “great potential” because it has a well-developed renewable energy sector with important solar and wind resources, said Javier Brey, president of the Spanish Hydrogen Association (AeH2).
Cossent said Spain has another advantage in its vast natural gas network and its LNG terminals, which could be converted to export hydrogen.
The government last year unveiled a €1.5 billion ($1.8 billion) plan to support green hydrogen projects over the next three years, tapping into a European Union Covid recovery fund .
If you add private investments, almost nine billion euros will be spent by 2030.
– Future energy hub? –
Spanish energy companies such as 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 called HyDeal Espana in the North Asturias region.
The site will have around 15 solar farms that could produce 330,000 tons of hydrogen per year by 2030, which would be the world’s largest project of its kind, according to the International Renewable Energy Agency.
“This shows that the sector has matured,” said AeH2’s Brey. “The year 2030 may seem far away, but in reality it is tomorrow.”
Spain “holds all the cards to become a powerhouse,” he added.
But the country still has a few hurdles to overcome before it can become a leader in the burgeoning sector.
“To win, Spain needs to speed up the construction of solar and wind farms as electrolysis consumes a lot of electricity,” Cossent said, adding that projects were stuck in “administrative bottlenecks”.
Spain also lacks energy connectivity to the rest of Europe, but the government has revived a gas pipeline project linking Catalonia and France, which Madrid plans to use to transport hydrogen.
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