Big Oil bets that green hydrogen is the future of energy

Big Oil bets that green hydrogen is the future of energy

Last Updated: Jun 20, 2022

The Big oil majors have been building multibillion-dollar projects since forever,” said Julien Rolland, head of power and renewables at commodities trader Trafigura Group Pte Ltd. “This green hydrogen, green ammonia stuff will be the new energy industry.

US giant Chevron Corp. is ready to spend billions on a mixture of green and blue hydrogen. After years of dabbling, major oil companies are finally planning the kind of large-scale investments that would make green hydrogen a serious business.

They’re chasing a very particular vision of a low-carbon future — multibillion dollar developments that generate vast concentrations of renewable electricity and convert it into chemicals or clean fuels that can be shipped around the world to power trucks, ships or even airplanes.

“The oil majors have been building multibillion-dollar projects since forever,” said Julien Rolland, head of power and renewables at commodities trader Trafigura Group Pte Ltd. “This green hydrogen, green ammonia stuff will be the new energy industry.”

The plan is well suited to the companies’ natural strengths in project management and their financial heft, but even with those advantages they’re still making a big bet on an unproven technology that could fall short of its potential.

“I don’t think any company out there has developed anything to these kinds of scales,” said Gero Farruggio, head of Australia and global renewables at consultant Rystad A/S.

Deep PocketsThis month has seen a flurry of big news about hydrogen.

BP Plc is taking the lead in the $36 billion Asian Renewable Energy Hub, a project that aims to install 26 gigawatts of solar and wind farms over a vast 6,500-square-kilometer (2,500 square-mile) stretch of Western Australia’s Pilbara region, and use the electricity generated to split water molecules into hydrogen and oxygen. Once fully developed, each year it would produce about 1.6 million tons of green hydrogen or 9 million tons of ammonia, which can be used to make fertilizer.

TotalEnergies SE has joined Indian billionaire Gautam Adani’s conglomerate in a venture that has the ambition to invest as much as $50 billion over the next 10 years in green hydrogen. An initial investment of $5 billion will develop 4 gigawatts of wind and solar capacity, about half of which will feed electrolyzers producing hydrogen used to manufacture of ammonia. The venture could expand to 1 million tons of annual green hydrogen production by 2030, driven by 30 gigawatts of clean power.

It’s only a matter of time before Shell Plc follows with a megaproject of its own, said Paul Bogers, vice president for hydrogen at the company. Shell is looking for a place where there are sufficient wind and solar resources for a large-scale project that would play to its strengths, he said in an interview on the sidelines of the Financial Times Hydrogen Summit in London.

“The size of these projects isn’t something done by a small startup,” Bogers said. “It requires deep pockets.”

US giant Chevron Corp. is ready to spend billions on a mixture of green and blue hydrogen, which uses a chemical reaction to split natural gas and capture and store the carbon dioxide. Smaller players in the oil market are also getting involved, with Trafigura looking at a number of mid-size green hydrogen projects, such as a 440-megawatt development near Adelaide, Australia.

While the trading house doesn’t have the balance sheet of an oil major, it’s looking to develop large-scale projects of multiple-gigawatt capacity, including one n South America, and then bring on a larger partner to actually build it, Rolland said.

Lifeline to the FutureThe global supermajors still spend the bulk of their money on oil and gas, but are devoting a growing proportion to low-carbon energy. That has included major investments in areas well outside their core business — offshore wind farms, solar plants, battery technology and electric-car chargers.

“Electrons don’t need the type of infrastructure” that the oil majors specialize in, said Meredith Annex, an analyst at BloombergNEF. But hydrogen is a molecule and “these are companies that understand molecules and infrastructure design around molecules.”

Until recently, the majors’ hydrogen plans have been modest. BP is developing an electrolyzer at its Lingen refinery in Germany and its Castellon plant in Spain, making green hydrogen for use in those facilities. Shell started up a 10 megawatt plant producing hydrogen for its Rheinland refinery in Germany last year and already has plans to expand its capacity.

The nature of hydrogen, with its complex processing plants, pressurized pipelines and storage facilities, and the specialized tankers required for distribution, makes it “a lifeline into the future” for Big Oil, said Annex.

There’s another natural synergy for companies that have a long history of seeking the largest concentrations of energy and the biggest markets in the world and finding low-cost ways to connect them.

For green hydrogen “one of the key attributes is having very competitive renewable energy resources,” said Tom Ellacott, a senior vice president at consultant Wood Mackenzie Ltd. BP has gone to Australia because “you’ve got a lot of sun,” while TotalEnergies is in India because “low-cost ammonia is potentially a very big market.”

Long GameWhile giant projects may be the future of green hydrogen, there’s a long way to go before they’re proved to be commercially viable, said Pierre-Etienne Franc, chief executive officer of Hy24, a joint venture between asset managers Ardian SAS and FiveT Hydrogen.

“You can’t move from 10 megawatt size to gigawatt size just like that,” Franc said. First it will be necessary to build facilities at the scale of hundreds of megawatts — 10 times the size of pilot projects currently operating in Europe. Those will enhance the operational knowledge and the electrolyzer manufacturing capacity necessary to scale up to the next level, he said.

Rystad estimates that the average size of a green hydrogen electrolyzer is 3 to 4 megawatts. That should increase by 20 times by 2025, leaving a lot of groundwork still to be done for gigawatt-scale developments.

“There’s a long way to go before one of these projects actually starts seeing significant capital investment,” said Farruggio. “It will possibly be a stretch to see this coming in prior to 2030.”

That fits with the announced timetables for full expansion of the BP and TotalEnergies’ green hydrogen ventures, and is well within the 2050 deadline for the companies to achieve net-zero carbon emissions. Large-scale hydrogen, unproven though it may be, could represent the best chance for the current generation of oil majors to remain as key players in a mid-21st century, climate-compatible energy industry.

“At some point, oil and gas will have to start declining to get on that Paris-aligned trajectory,” said Ellacott. Green hydrogen is the best fit for a new low-carbon profit center because it’s “such a big long-term growth market, it’s really in the majors’ sweet spot in terms of synergies with their existing businesses.”

Source Link: https://economictimes.indiatimes.com/industry/renewables/big-oil-bets-that-green-hydrogen-is-the-future-of-energy/articleshow/92328937.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Spain bets on green hydrogen in clean energy push

Spain bets on green hydrogen in clean energy push

Last Updated: Jun 22, 2022

Spain accounted for 20 percent of the world’s green hydrogen projects in the first quarter, second only to the United States, home to more than half of them, according to Wood Mackenzie consulting firm.

Madrid: As Europe seeks to move way from fossil fuels, Spain is racing ahead in developing green hydrogen, aided by a growing wind and solar power complex in efforts to decarbonise its economy.Spain accounted for 20 percent of the world’s green hydrogen projects in the first quarter, second only to the United States, home to more than half of them, according to Wood Mackenzie consulting firm.”A lot of countries are interested in green hydrogen, but in Spain the sector has rapidly accelerated” in recent months, said Rafael Cossent, research associate professor in energy economics at 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 goal 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 … to mass-scale competitive hydrogen”.Green hydrogen is produced by passing an electric current through water to split it between hydrogen and oxygen, a process called electrolysis. It is considered green because the electricity comes from renewable sources of energy that don’t create any harmful emissions.And while fossil fuels emit harmful greenhouse gases when they burn, hydrogen only emits harmless water vapour.The technology is part of EU 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 fertiliser and is being considered as a potential fuel for buses, trains and aircraft in the future.A major drawback for green hydrogen, however, has been the high cost of producing it. It is much cheaper to make “grey” hydrogen, but its production requires using fossil fuels that emit greenhouse gases.But technological progress and the surge in prices of fossil fuels has made green hydrogen more competitive.Spain has “great potential” because it has a well-developed renewables sector, with important solar and wind resources, said Javier Brey, president of the Spanish Hydrogen Association (AeH2).Cossent said that Spain has another advantage in its vast natural gas network and LNG terminals, which could be transformed to export hydrogen.The government launched last year a 1.5-billion-euro ($1.8-billion) plan to support green hydrogen projects over the next three years, tapping a European Union Covid recovery fund to do so.Adding private investments, close to 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 teamed up with global steel giant ArcelorMittal and fertiliser maker Fertiberia for a huge project dubbed HyDeal Espana in northern Asturias region.The site will have around 15 solar parks that could produce 330,000 tonnes of hydrogen per year by 2030, making it the biggest project of this type in the world, according to the International Renewable Energy Agency.”This shows the sector has matured,” said Brey of AeH2. “2030 may appear far away, but in reality it’s tomorrow.”Spain “holds all the cards to become an energy hub,” he added.But the country still has some obstacles to clear before it can become a leader in the burgeoning sector.”To win, Spain will have to speed up the deployment 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 with the rest of Europe, but the government has revived a gas pipeline project linking Catalonia and France, which Madrid wants to use to ship hydrogen.

 

Source Link: https://energy.economictimes.indiatimes.com/news/renewable/spain-bets-on-green-hydrogen-in-clean-energy-push/92379644

India needs $225-250 bn investment to meet its 2030 renewable energy target: Moody’s

India needs $225-250 bn investment to meet its 2030 renewable energy target: Moody’s

Last Updated: Jun 13, 2022

Investment
“The country aims to triple its renewable energy capacity to 500GW by 2030 from 157GW as of March 2022, and to have 50% of the electricity generation from non-fossil fuel sources. The key enabler will be the competitiveness of wind and solar generation over coal-fired power generation because of technological developments, supportive government policies, private sector participation,” says Abhishek Tyagi, a Moody’s Vice President and Senior Credit Officer.

If India is to to reach its net-zero emissions by 2070, it needs a shift in its energy mix toward renewable energy, enabled by supportive government policies, private sector participation and low cost capital, Moody’s Investors Service said in a report on Monday.

The government’s support in encouraging the private sector and overseas investors to participate in renewables would be key in India achieving its targets, the report said.

Overall, the country will need investment of around $225-250 billion to meet its 2030 renewable targets.

India’s ability to reach its 2030 renewable energy goals will be determined by its ability to acquire low-cost, long-term, and diverse finance sources from both the public and private sectors.

“The country aims to triple its renewable energy capacity to 500GW by 2030 from 157GW as of March 2022, and to have 50% of the electricity generation from non-fossil fuel sources. The key enabler will be the competitiveness of wind and solar generation over coal-fired power generation because of technological developments, supportive government policies, private sector participation,” says Abhishek Tyagi, a Moody’s Vice President and Senior Credit Officer.

The government’s continued policy support is critical – the country’s renewable energy footprint has grown dramatically over the last 4-5 years as a result of favourable government policies that encouraged domestic and international investors to participate in the sector.

The poor financial health of India’s state-owned distribution businesses will continue to be a hurdle for the country’s renewable energy sector. Payment delays are common for these enterprises, resulting in a buildup of receivables from off-takers and an increase in working capital debt for renewable energy companies, the report said.

 

Source Link: https://economictimes.indiatimes.com/industry/renewables/india-needs-225-250-bn-investment-to-meet-its-2030-renewable-energy-target-moodys/articleshow/92173747.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Uttar Pradesh Gets Investment Proposals Of Rs 4782 Crores For Renewables

Uttar Pradesh Gets Investment Proposals Of Rs 4782 Crores For Renewables

Last Updated: Jun 21, 2022

Investment Proposals Of Rs 4782 Crores

Highlights :

  • SJVN shall be investing Rs 1000 crore through three solar power projects in Uttar Pradesh.
  • In the category Rs 500 – 200 crore, AMP Energy will implement a project of Rs 450 crore in Ballia and another project of Rs 300 crore Mau.

The outcome of GBC 3 (third ground breaking ceremony) has been quite fruitful for the state of Uttar Pradesh in the renewable energy sector development and energy transition. In the most recent case, key players have vowed to invest in the renewable energy segment as investment proposals of Rs 4782 crore have come up for the development of clean energy.

A sector-wise analysis of the distribution of the proposals reveals that 23 projects in the renewable energy sector will be developed in 21 districts out of the states 75 districts. These are Jalaun, Mau, Ballia, Azamgarh, Sitapur, Jhansi, Banda, Fatehpur, Kanpur, Noida, Auraiya, Sonbhadra, Agra, Ambedkarnagar, Badaun, Mahoba, Mirzapur, Pilibhit, Pratapgarh, Shahjahapur, and Unnao.

Uttar Pradesh is lagging well behind to achieve its solar energy target of 10.5 GW by the end of 2022. By October 2021, the largest state of India had merely added 4.3 GW of total renewable energy which is less than a third of its commissioning target of 14.1 GW. Fresh investments provide a ray of hope that may expedite the renewable projects in UP. These have been helped along by state owned energy firms in no small measure

In the fresh investment proposals, state owned SJVN shall be investing Rs 1000 crore through three solar power projects in Uttar Pradesh. Two of these will come up in Jalaun and the third will be implemented in Kanpur. The proposals have come under the category of projects worth over Rs 500 crore. The two Jalaun based solar projects will attract investments of Rs 791 crore.

In the category Rs 500 – 200 crore, private sector AMP Energy will implement a project of Rs 450 crore in Ballia and another project of Rs 300 crore Mau. Multiple projects in the same category will also come up in Azamgarh, Jhansi, Sitapur, Banda, Fatehpur, Auraiya, Noida and Sonbhadra.

As far as the projects of Rs 200 – 10 crore value are concerned, SAEL Limited will make the largest investment of Rs 170 crore in Jalaun. Hindustan Petroleum will also invest Rs 125 crores in Badaun.

Uttar Pradesh requires more such investments as a joint report by Institute for Energy Economics and Financial Analysis, and think tank Ember holds that UP’s renewable energy dash lags behind and more so in the solar segment as the state has added just 2 GW of solar power which is just 19 per cent of the target. As always, the rooftop segment offers a glaring opportunity, and the biggest miss, with the state having barely 180 MW of rooftop capacity versus a target of 4300 MW out of the 10500 MW target for 2022.

Source Link: https://www.saurenergy.com/solar-energy-news/uttar-pradesh-gets-investment-proposals-of-rs-4782-crores-for-renewables

Airports To Become Carbon Neutral By December 2024

Airports To Become Carbon Neutral By December 2024

Last Updated: Jun 15, 2022

Carbon Neutral

Highlights :

  • With renewable energy from solar playing a key part in such efforts, its time to set clear goals for every large airport across the country to be renewable powered by 2024 or earlier.

The government is aiming to make Most Indian airports carbon neutral by December 2024 and achieve Net Zero emissions by 2030. Rubina Ali, joint secretary, Ministry of Civil Aviation, recently wrote to the CEOs of the private airports and the Airports Authority of India (AAI) to submit a plan to achieve net zero. Her letter reads, “Airports in India are already at the forefront by adopting various measures to reduce emissions, such as renewable energy development. All airports (must) adopt carbon management plans in their existing operation and ongoing airport expansion. All airport operators to adopt Carbon Mitigation Measures as their milestones with definite time frame,”. Cochin, Delhi, Bangalore and Mumbai airports have successfully taken to renewable energy model motivating the rest of the airports to follow the beaten path.

While renewable energy is the obvious first step for most airports, thanks to the abundant areas they are spread across, other targets like zero water discharge facilities and rainwater harvesting are also a must, which only some are practicing or moving towards now.

Giving a peek into the mind of the aviation minister, another senior official from the ministry has been quoted as saying, “The aviation minister has special focus on green airports, and we will be able to achieve that. The airports have now submitted the plan and we will keep monitoring it. While many airports have already working towards environment friendly measures, we want to ensure everyone does,”.

GMR-led Delhi International Airport Limited has got the distinction of being Asia Pacific’s first Level 4+ (Transition) accredited airport under ACI’s airport carbon accreditation programme. Besides, Chhatrapati Shivaji Maharaj International Airport (CSMIA) had been bestowed the Energy Efficient Unit certification by the Confederation of India Industry (CII) for a host of sustainable and green initiatives. Kochi airport of course has been the pioneer with its solar power additions that have made it completely energy indepoendent. Among the several initiatives by the Airports Authority of India (AAI) are installation of solar power plants under net metering/captive mode at various airports for generation and self-consumption of green and renewable energy. Besides, a few airports procure green energy through open access. Covering nearly 3.9 million square feet within the IGI Airport premises, around 40,000 air purifying plants have been put inside the three-terminal buildings of the Delhi airport to clean the indoor air. DIAL has also taken to the “single-use plastic-free airport”. CSMIA has also taken several steps during the pandemic to optimize energy consumption, resulting in energy usage to 35%. Cochin International Airport Ltd (CIAL), fully powered by solar energy, has achieved a cumulative production volume of 25 crore units; offsetting 1,60,000 metric tons of carbon emission.

Bangalore International Airport Limited (BIAL), operator of Kempegowda International Airport, Bengaluru, consumes nearly 100% renewable electricity (70 Mn units), leading to largely Zero Scope 2 emissions (>50000 MT of carbon emissions reduction). The public transport sector, be it aviation, railways and highways, needs to go green with a vengeance, as they have all access to crucial land and other structures where solar power will thrive. India needs to get way more ambitious in this regards, and setting a clear target for 2025 will not be a bad idea at all.

Source Link: https://www.saurenergy.com/solar-energy-news/airports-to-become-carbon-neutral-by-december-2024

RENEWABLES 2022 GLOBAL STATUS REPORT

RENEWABLES 2022 GLOBAL STATUS REPORT

Last Updated: Jun 15, 2022

RENEWABLES 2022

As the world’s only crowd-sourced report on renewable energy, the Renewables 2022 Global Status Report (GSR) is in a class of its own. The Renewables 2022 Global Status Report documents the progress made in the renewable energy sector. It highlights the opportunities afforded by a renewable-based economy and society, including the ability to achieve more diversified and inclusive energy governance through localised energy generation and value chains. Countries with higher shares of renewables in their total energy consumption enjoy a greater level of energy independence and security.

In response to an unprecedented public health crisis, countries around the world had hoped to seize the post-COVID-19 opportunity for a green and equitable recovery. Unfortunately, and despite record growth in renewable energy deployment in 2021, this historic chance has been lost. As of mid-2022, the world was experiencing its biggest energy crisis on record. Although this crisis was exacerbated by the Russian Federation’s February 2022 invasion of Ukraine, prices for fossil fuels – coal, oil and natural gas – were already spiking by late 2021, leading to the threat of energy poverty for billions of people.

Despite evidence that renewables are the most affordable energy source to both improve resilience and support decarbonisation, governments across the world continue to resort to fossil fuel subsidies to keep energy bills under control. This growing gap between countries’ ambition and action on the ground is alarming and sends a clear warning that the global energy transition is not happening.

Building the sustainable energy future

There is an unprecedented momentum for leaving the fossil fuel age behind us. And we must do it now. Before the COVID pandemic, millions of young people took to the streets to force decision-makers to understand the climate crisis we are facing. While protests had to go digital over the last several months, it does not alter the fact that patience and faith in politicians, who hesitate and waver, is fading away.

We at REN21 know that with a rapid transition to renewable energy and energy efficiency we can turn the tide. With our worldwide community of experts, we can prove that a transition to renewable energy is possible and happening – now! Together, let’s bring that knowledge to every citizen and every decision-maker throughout the world.

Be one of the first to know the latest status of renewables globally – Join our launch events from 15 June.

Join us on Wednesday 15 June to offically launch REN21’s flagship report Renewables 2022 Global Status Report (#GSR2022) and find out about the latest trends and key findings in renewables. Ms Teresa Ribera, the Spanish Third Deputy Prime Minister of Spain, and Minister for the Ecological Transition of Spain will share Spain’s experience and best practice in renewables.

Follow our conversation on IDAE’s YouTube page, from 13:00 CEST. We’re hosting many other events over the coming weeks; below is a snapshot of those not to be missed. This is our opportunity to bridge sectors, unpack policy, investment, market and industry trends and build momentum around the necessary structural shifts for the uptake of renewables – now.

In addition, we are hosting a number of thematic and regional events – and, as always, you are invited. Main events will be added below, and additional speaking engagements are added regularly on our Let’s Meet Up web calendar

Source Link: https://www.ren21.net/wp-content/uploads/2019/05/GSR2022_Full_Report.pdf