On Tuesday, Castleton Commodities International (CCI), the Stamford, Connecticut-based energy commodities and infrastructure investment firm, announced that it is backing Europe’s first green hydrogen project to be co-located at an existing combined cycle gas turbine power plant (CCGT). According to a company announcement, Castleton’s involvement in developing the Amorebieta-Boroa CCGT site in Spain reflects CCI’s ambition to advance the energy transition and contribute to decarbonizing Europe’s economy.
CCI is investing alongside White Summit Capital, a Madrid-headquartered infrastructure investor specialized in energy transition; Bizkaia Energía, which directly owns the Amorebieta-Boroa CCGT and is itself majority owned by CCI, Nortegas, the second largest gas distributor in Spain (in which White Summit is a majority investor), and SENER, a leading Spanish engineering and technology group.
The project consists of a 20 MW green hydrogen plant adjacent to the Amorebieta-Boroa CCGT utilizing part of the existing infrastructure of the conventional power generation plant and gas distribution network. The plant is expected to generate 1,500 tons of green hydrogen per year from 100 percent renewable sources which will offset the emission of more than 12,000 tons of CO2 into the atmosphere, the equivalent of taking more than 2,500 cars off the road each year.
A portion of the green hydrogen generated will be used by the power plant and will serve to directly reduce its CO2 emissions. In addition, the hydrogen will be injected into Nortegas’ gas distribution network and blended with natural gas, thereby decarbonizing part of the current gas system. The project also includes installing a hydrogen refueling station to meet the fuel requirements of local public-private fleets of hydrogen-powered vehicles.
The project is the first of its kind to be co-located adjacent to a host CCGT and, according to CCI’s announcement, will be instrumental in the decarbonization process of Spain’s power and transportation sectors. The site will be commercially operational by 2022.
CCI currently owns and operates over 2,000 MW of power generation in Europe and, if successful, this project technology could be deployed in scale at all of its European power generation facilities.
“Together with our partners, CCI is seeking to accelerate the energy transition initiative in Europe through the investment in key technologies such as hydrogen to power,” said Arie Pilo, CCI’s Co-Head of Power Principal Investing. “We are excited to be working on these projects that simultaneously reduce emissions, promote the stability of the grid and address important issues arising from the rapid acceleration of renewable energy resource deployment. Specifically, in the port of Rotterdam in the Netherlands, where CCI owns two CCGTs, we will look to collaborate with our local partners to continue to support the grid and to explore innovative ways to address the challenges of intermittency in the context of decarbonization.”
Mainly in Spain
Spain has emerged as a site of considerable interest for green hydrogen development in recent months. In November, Nel Hydrogen Electrolyzer, a division of Norwegian hydrogen producer Nel ASA signed a Memorandum of Understanding (MoU) with Spanish utility giant Iberdrola to develop a 200 MW green hydrogen production plant in Spain by 2023, and to jointly develop a complete green hydrogen technology value chain in Spain.
“We are honored that Iberdrola wants to work more closely together with us on electrolyzer projects in the 100-MW scale and beyond. Just as Iberdrola in the past successfully contributed to developments in the wind industry, they are now doing the same within hydrogen,” Nel CEO Jon André Løkke said upon formally announcing the MoU in November.
Also in November, Iberdrola announced plans with global fertilizer manufacturer Fertiberia to develop an 800 MW green hydrogen project for the production of green ammonia. Shortly thereafter, Nel and Iberdrola announced that Nel would be the preferred partner for the delivery of a 20 MW PEM electrolyzer facility in Puertollano, Spain.
“This initiative will accelerate the production of green hydrogen in Spain and will create a new industry, the manufacturing of electrolyser systems, with high growth potential. We continue to make progress in our ambitious plan to put Spain and Europe at the global forefront of this technology by reducing energy dependence and fossil fuel consumption while driving the country’s economic and social revitalization,” Iberdrola Chairman and CEO Ignacio Galán said at the time.
Over the summer, the European Union—as part of a sweeping program aimed at achieving net-zero carbon emissions by 2050—announced an ambitious green hydrogen strategy targeting 6 GW of installed electrolyzer capacity by 2024, 40 GW installed within EU borders by 2030, and another 40 GW in neighboring countries with export capacity to the EU.
