Magnum Development LLC and Mitsubishi Power Americas Inc. have secured a $504 million loan guarantee from the U.S. Department of Energy (DOE) to develop what could be the world’s largest green hydrogen industrial hub in Delta, UT.
The loan is the DOE’s first in more than 10 years for a renewable energy project, Mitsubishi Power said.
The funding “helps generate a viable market for hydrogen and will make it scalable across the western United States and the electric grid, creating the foundational infrastructure needed to deploy this carbon-free energy source,” the company added. society.
The hub, called Advanced Clean Energy Storage I LLC (ACES I), is designed to initially produce up to 100 metric tons/d of green hydrogen from renewable energy through 220 MW of electrolysers.
The hydrogen can then be stored in two salt caverns, each capable of storing 150 GWh of energy, “providing the largest hydrogen storage site in the world and the ability to seasonally move excess salt.” renewable energy,” said Mitsubishi Power. “The long-term energy storage capacity of the salt caverns will help improve resource adequacy and reduce costs by capturing excess renewable energy when it is abundant and feeding it back into the grid when there is a shortage. need.”
From coal to clean hydrogen
ACES I would supply hydrogen feedstock to the Intermountain Power Plant Renewal Project (IPP), a revamp of Utah’s largest coal-fired power plant.
The Renewed project involves the replacement of IPP’s existing coal-fired units with new natural gas-fired units capable of also running on hydrogen, with a combined net capacity of 840 MW.
The project would see the plant initially run on a mix of 30% green hydrogen and 70% natural gas in 2025, and gradually expand to 100% green hydrogen by 2045.
The DOE loan “creates a pathway to accelerate the long-term hydrogen market and clean energy landscape to expand decarbonization across the United States,” said Michael Ducker, senior vice president. of Mitsubishi Power’s hydrogen infrastructure.
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US Energy Secretary Jennifer Granholm has also touted the virtues of clean hydrogen.
“Since President Biden’s first day in office, the DOE has made it a priority to leverage the potential of the Office of Lending Programs to fund emerging technologies that will deliver clean, reliable energy for Americans,” it said. she declared. “Accelerating the commercial deployment of clean hydrogen as a long-term, zero-emissions energy storage solution is the first step to harnessing its potential to decarbonize our economy, create well-paying clean energy and allow more renewables to be added to the grid. ”
The ACES I project is part of a larger initiative by Mitsubishi Power to create a “hub and spoke” network of hydrogen production, transport and storage infrastructure in North America.
Magnum Development has been developing the Delta storage site since 2008.
“A big step”
The ACES I joint venture “is historic for Mitsubishi Power Americas and the future of global hydrogen deployment,” said Bill Newsom, CEO of Mitsubishi Power. “We are proud to partner with Magnum Development and provide the hydrogen equipment to advance carbon-free hydrogen as a cornerstone of our future energy supply and help pave the way to net zero. This project sets the industry benchmark for hydrogen deployment, helping to combat the impacts of climate change and advance human prosperity.
The development and operation of ACES I will create up to 400 local construction jobs over its three-year construction cycle and will employ approximately 25 full-time operations and maintenance staff. said Mitsubishi Power.
In a research note, Evercore ISI analysts led by James West called the ACES I loan “a big step for the DOE and the US administration.” President Biden has been clear in his goal of achieving a clean grid by 2035 and achieving net zero economy-wide emissions by 2050, for which long-term energy storage technology duration such that hydrogen will be essential.
The Evercore team added, “If anyone still needed confirmation, the energy transition is in full swing.”