Mitsubishi Corporation plans to make a significant investment in what would be the largest green hydrogen project globally , signaling the industry’s determination to advance the construction of clean energy projects despite rising costs.
The estimated investment is around $690 million , equivalent to more than 100 billion Japanese yen, for a green hydrogen production plant in Rotterdam’s Europoort industrial zone, as reported by Nikkei Asia.
The project, called Eneco Electrolyzer, would become the largest green hydrogen plant in the world , with a capacity of 800 MW and an annual production of up to 80,000 tons of hydrogen. This production capacity would be almost 30 times greater than any other green hydrogen project currently operating around the world.
The Eneco Diamond Hydrogen joint venture, made up of Eneco and Mitsubishi, will be in charge of building and operating this project that will use renewable energy from solar and wind farms for the production of clean hydrogen, initially aimed at the industrial sector. The planning application was submitted by Eneco in November 2023, anticipating the start of construction in 2026 and the green hydrogen plant expected to begin operations in 2029.
” Producing green hydrogen is essential for the success of the energy transition ,” declared Eneco CEO As Tempelman two months ago.
The challenges behind green hydrogen
As heavy industry and governments turn to hydrogen to drive decarbonization and power, oil and gas companies look to diversify into low-carbon hydrogen production, high costs remain an obstacle to widespread project implementation. .
Analysts, including the International Energy Agency (IEA), a proponent of green practices, recognize that costs must be reduced significantly for clean hydrogen to play a crucial role in the energy transition. Green hydrogen, which currently costs between 3 and 8 euros per kg in some regions, is more expensive than “gray” hydrogen, produced from natural gas, according to a PwC analysis last year.
” Low-emission hydrogen production can grow massively between now and 2030, but cost issues hamper its deployment ,” the IEA noted in its Global Hydrogen Review 2023 report, published in September 2023.
Likewise, increases in financial and equipment costs are creating risks for projects and diminishing the impact of government support for deployment, the agency warns, although it highlights that interest in low-carbon hydrogen projects remains robust.
Don’t miss any of our posts and follow us on social media!