Spain enhances at­trac­tive­ness in renewables – Focus on hydrogen through the European Union’s Recovery and Resilience Facility

February 6, 2023
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Press release from Business Finland

Spain is one of the European countries with the highest solar radiation and therefore a resource for photovoltaic deployment, the one with the greatest potential. This wealth, together with technological know-how, the leadership of its energy companies and public-private investment, can make us producers and exporters, especially to northern Europe, where there is a lack of natural light but an abundance of energy demand.

WHY SPAIN ON GREEN HYDROGEN?

Spain contributes 1.4% to global GDP, however Spain has the 3.6% of world scientific production related to hydrogen and fuel cells. Almost 50% of the electricity that comes out and is consumed already has that origin and the government objective is to reach 74% in 2030. Two years ago, company investments in R&D&I related to renewables reached 2.99% of the direct contribution to the national GDP, whereas the Spanish average was limited to 1.24% and the European one to 2.11%. Also, the Spanish government has shown commitment by allocating specific funds through EU NextGen.

SPANISH ENERGY COMPANIES COMMIT TO GREEN HYDROGEN, ALIGNED WITH THE EU AND THE SPANISH GOVERNMENT

The commitment to green hydrogen in Spain is well reflected in the projects that will be carried out by large companies with an international presence such as Repsol, Iberdrola, Acciona, Cepsa, Enagás or EDP, which will invest more than 15 billion euros in green hydrogen projects in Spain in the coming years, with the aim of becoming the main producers of this raw material. The war in Ukraine and the target of energy independence pushed large companies to speed up the development of one of the main energy vectors to achieve the decarbonization of the economy, thanks mainly to its versatility.

THE FUTURE OF GREEN HYDROGEN IN EUROPE PASSES THROUGH SPAIN AND PORTUGAL

The Ministry for the Ecological Transition and the Demographic Challenge has provisionally approved aid to promote green hydrogen in Spain for 250 million euros. In total, the 29 awarded projects add up to 487 megawatts (MW), which represents 12% of the objective set by Spain for 2030 to promote green hydrogen, which involves the installation of electrolysers for at least 4 gigawatts (GW). The winners include the country’s leading companies in the energy sector, such as Repsol, Iberdrola, Cepsa, Endesa, EDP and Enagás, among others. The Renewable Energies, Renewable Hydrogen and Storage Part will allocate 1,6 billion euros to green hydrogen, which in turn will mobilize another 2,8 billion euros of private capital.

Iberdrola is fully committed to developing the green hydrogen market with two real projects built in 2022 in Spain (a 2.5 MW hydrogen refuelling station for buses in Barcelona and a 20 MW green hydrogen plant in Puertollano for the industry of fertilizers – Europe’s largest industrial electrolyser at the moment). Iberdrola has a green hydrogen mature portfolio of 2,400 MW by 2025 (40% in Spain), with more than 60 projects in eight countries (Spain, United Kingdom, Brazil, United States, among others) that will require investments of 9 billion euros by 2030, with the aim of developing 3 GW of electrolysers. In words of Roque Bernadó, Green H2 Development Manager at Iberdrola, “The new reality of green hydrogen sector in Spain, spearheaded by IBERDROLA, represents a unique opportunity to help the most challenging hard-to-abate polluting industrial sectors in transforming their processes and becoming more sustainable”.

EDP has plans in the Iberian Peninsula too, more specifically in Los Barrios. The company proposes 100 MW of electrolysers, later scalable, in Campo de Gibraltar and the installation of a green hydrogen plant on the land of the Viesgo thermal power plant (group subsidiary) also in Los Barrios, with a calculated investment of 555 million euros and a total capacity of 700 megawatts.

Acciona is not far behind in this race either, and it is that through strategic alliances, such as the one carried out with Enagás in Palma de Mallorca -Power To Green Hydrogen Mallorca- or the one carried out with Plug Power, it also intends to build hydrogen plants throughout the country. The one located in the Balearic Islands will generate and distribute more than 300 tons of hydrogen per year. Regarding the agreement with Plug Power, both companies plan to build two hydrogen plants in early 2023, according to sources close to the projects, in Tarragona, although the final location has yet to be determined.

But not only the Spanish energy companies are betting on green hydrogen in our country. In the last part of 2022, the Danish shipping company Maersk announced its intention to establish a large hub for the production of green methanol and ammonia for fuels in the maritime sector based on hydrogen in Spain. This project could involve an investment of about 10 billion euros.

POTENTIAL COLLABORATIONS OPEN FOR FINNISH OPPORTUNITIES

Spain aspires to produce more than a fifth of the European production of green hydrogen by 2030. This will not be possible without international cooperation. A good example would be Finland and Spain, with strong collaborations within the industry decarbonization or the forestry sector.

VTT recently visited Spain end of last year, visiting key stakeholders through the whole hydrogen value chain. Mr. Pasi Kokko, Sales and Customer Partnerships at VTT concluded after the visit that the both countries Finland and Spain have the driver seat role in creating European hydrogen ecosystem. Both countries are investing intensively to green electricity which is key enabler for green transition and carbon neutral society. And he added the co-operation between Spanish and Finnish companies and research institutes creates great opportunities locally but also leads the way for the whole Europe in green transition.

Sources from the Ministry of Ecological Transition indicate that this interest will make it possible to reach and exceed the 4 GW goal by the end of this decade. Spain is the fifth country in the world in wind energy, the eighth in renewable generation. Of all the green hydrogen projects worldwide, 20% are located in Spain, only behind the United States.

FURTHER INFORMATION

Senior Advisor (Energy, Bioeconomy, General Market Advice)
Guillermo Solano De La Asunción
Madrid, Spain
guillermo.solano (at) businessfinland.fi
Tel. +34 667 869 645


Originally published on 3 February

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