bp and Iberdrola to invest in largest green hydrogen plant in Spain
London, September 12, 2024, (Oilandgaspress) ––: bp and Iberdrola have given the green light for construction of a 25 MW green hydrogen project at bp’s Castellón refinery which is expected to be operational in second half of 2026. This is the first hydrogen project jointly undertaken by bp and Iberdrola through Castellón Green Hydrogen S.L., a joint venture equally owned by both companies. The project was presented at an official event to publicly celebrate the signing in July 2024 of the final investment decision between bp and Iberdrola.
This initiative, which includes the participation of the Technology Institute of Energy (ITE), has been awarded funding of 15 million euros from the Innovative Value Chain and Renewable Hydrogen Knowledge call of the Spanish Recovery, Transformation, and Resilience Plan, with funding allocated by NextGenerationEU of the European Union.
The 25 MW electrolyzer will be powered by renewable electricity through a power purchase agreement (PPA) signed with Iberdrola that will supply 200GWh/year coming from Iberdrola’s photovoltaic and wind projects. The electrolyzer will include 5 modules of 5 MW containerized proton exchange membrane (PEM) technology, which will be supplied by Plug Power, a leading manufacturer of green hydrogen solutions.
The green hydrogen produced by the electrolysis of water powered by renewable electricity will comply with European requirements to produce green hydrogen (Renewable Fuels of Non-Biological Origin, RFNBO) and will support the transition of bp’s Castellón refinery into an integrated energy hub. It’s expected around 2,800 annual tons of green hydrogen could substitute part of the grey hydrogen currently used by the refinery – currently produced from natural gas – and as such is expected to result in avoiding the emission of 23,000 tons of CO2 per year, equivalent to the emissions of 5,000 cars over the same period. This plant could create up to 500 new direct jobs during its construction.
In parallel to this initial 25 MW project, bp continues to assess opportunities to increase capacity in the coming years. In subsequent phases of the project, the green hydrogen produced could also be used in key hard-to-abate industries in the Valencia region, such as the ceramics sector replacing natural gas used in its processes, in chemical industries and in heavy transport.
The launch of this project has been announced just weeks after bp signed a letter of intent with the Valencian Government to reinforce the region’s position as a leader in the energy transition. The letter has materialized in the creation of a joint working committee that will serve as a platform for dialogue and collaboration between both parties and will oversee the transformation of bp’s refinery in Castellón into an integrated energy hub.
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