Energy Transition in Motion (Week of April 7, 2023): Advancing Projects, Investment

Offshore wind developers advanced on more projects this week as buyers agreed to purchase wind energy, pushing them closer to net-zero emissions goals.

Hydrogen players also continued lining up offtake deals and collaboration agreements, while developers took their research on hydrogen blending to the next level.

Terms of an integrated gas project were also confirmed, making way for a 1-gigawatt (GW) solar project in the Middle East.

Here’s a look at some of this week’s renewable energy news.

Hydrogen

Linde, Exxon Mobil Sign CO2 Offtake Agreement

Hydrogen producer Linde and Exxon Mobil Corp. signed a long-term agreement for the offtake of CO2 associated with Linde’s new clean hydrogen production facility being constructed in Beaumont, Texas, the companies said on April 4.

As part of the agreement, Exxon Mobil will transport and permanently store up to 2.2 million metric tons (MMmt) of CO2 annually—equivalent to the emissions from nearly 500,000 cars per year—from Linde’s hydrogen production facility, according to a news release.

The agreement follows companies’ continued efforts to reduce emissions and use more low-carbon energy.

“Working with Exxon Mobil as the carbon dioxide off-taker at our Beaumont project supports Linde’s strategy to decarbonize customer processes while safely and reliably supplying low-carbon hydrogen at scale,” said Dan Yankowski, senior vice president for Linde’s Americas operations.

Expected to begin operations in 2025, Linde’s new Beaumont facility will supply hydrogen and nitrogen for OCI Global’s new blue ammonia plant and supply hydrogen to other off-takers.

Speaking to analysts on April 4, Dan Ammann, president of Exxon Mobil Low Carbon Solutions, called the pact “another landmark commercial offtake agreement.”

“It’s not hard to imagine us leveraging this for future potential activity at our nearby Beaumont site,” Ammann said, “and obviously we’ll be welcoming other third-party emitters to join as well.”

Obsidian Collaborates on Potential Hydrogen-fueled Power Plant

Obsidian Renewables will work with Washington state’s Grant County Public Utility District on the design of a potential hydrogen-fueled power plant with a storage and hydrogen production facility.

“This project kicks off the development of Obsidian’s Pacific Northwest Hydrogen Hub plan to make low-cost renewable hydrogen available to large parts of Oregon and Washington,” said Ken Dragoon, Obsidian’s director of hydrogen development, said in an April 6 news release. “Renewable hydrogen will play an important role in the region’s decarbonization goals, and we are proud to take this step towards a green energy future.”

Solar energy would be used to produce the hydrogen.

The hub is one of the 33 projects that have been encouraged to seek funding from the U.S. Department of Energy.

“The proposed power plant design will use an onsite storage pipeline to hold enough hydrogen so that the plant can operate for up to one week on the stored renewable energy,” the release said.

Grant County is already home to several industrial hydrogen users, which could use the hydrogen and surplus electricity generated.

Dominion Energy Begins Hydrogen Blending in Utah

Dominion Energy Utah said on April 3 it has started blending hydrogen into natural gas pipelines in Utah, marking the next phase of its ThermH2 project focused on no-carbon emissions fuel.

“An up-to 5% blend will be introduced to the city as well as to the surrounding towns of Oasis, Hinkley and Deseret, serving about 1,800 customers,” Dominion said in a news release. “The project will begin with grey hydrogen and will upgrade to green hydrogen later this year. During the course of the project, the majority of hydrogen blended will be green hydrogen made from renewable energy.

The first phase, which lasted one year and focused on blending hydrogen in the utility’s Training Academy, found that a 5% hydrogen blend was safe and compatible with current residential appliances and helpful in reducing emissions from appliances using natural gas, the company said.

The work is intended to help the company prepare its entire distribution system for blending by 2030.

“The commencement of this project is very exciting for Dominion Energy Utah,” said Judd Cook, vice president and general manager of Dominion’s Western Gas Distribution system. “We are always looking for ways to reduce emissions while still providing the reliable, affordable and safe service that our customers expect from us. This project provides an opportunity to do just that.”

India Plans Green Hydrogen Incentives

India plans to offer incentives to green hydrogen fuel producers worth at least 10% of their costs under a $2 billion scheme set to begin before the end of June, a top government official said.

New Delhi this year approved a 174.9 billion-rupee (US$2.1 billion) incentive plan to promote green hydrogen in a bid to cut CO2 emissions and become a major exporter in the sector.

The government will give incentives worth at least 30 Indian rupees per kg (US$0.37/kg) for production of green hydrogen fuel, the official, who is directly involved but did not want to be identified because the discussions are private, told Reuters.

The cost of manufacturing green hydrogen in India, made using renewable energy rather than power derived from fossil fuels, is currently at about 300 rupees per kg ($3.67/kg).

In response to a query from Reuters, India's Renewable Energy Secretary Bhupinder Singh Bhalla said the incentives will be awarded through a competitive bidding process. The incentive amount will taper down annually.

“Draft concept notes on the program have been circulated to industry chambers and associations for consultations,” he said.

Out of the total incentive plan for the sector, the government will award about 130 billion rupees for producing green hydrogen with the rest set aside for manufacturing electrolyzers, which are used to split hydrogen and oxygen molecules using electricity.

India set targets for half of its installed electricity capacity to be from non-fossil fuel sources by 2030 and for net-zero carbon emissions by 2070.

Solar

TotalEnergies Plans to Develop 1-GW Solar Plant in Iraq

TotalEnergies said April 5 it will develop a 1-GW solar power plant to supply electricity to the Basrah regional grid in Iraq.

The plan is part of an agreement reached recently with Iraqi authorities, confirming the terms of a development and production contract signed in 2021. As part of the agreement to move forward with the Gas Growth Integrated Project (GGIP), TotalEnergies and its partners will invest about $10 billion to recover flared gas on three oil fields to supply gas to power generation plants and build a seawater treatment plant for water injection for pressure maintenance. The investment will increase regional oil production along with the solar plant.

The French energy company said it will invite Saudi company ACWA Power to join the solar project.

The GGIP consortium will be comprised of TotalEnergies (45% interest), Basrah Oil Co. (30%) and QatarEnergy (25%).

Sun Pacific Lines Up Property for New Solar Plant

Sun Pacific Holding Corp. subsidiary Elba Power Corp. executed a contract to purchase property in Alabama for $2.95 million for its planned solar manufacturing facility.

The contract was announced on April 5. The company plans to develop a 1.2-GW solar product manufacturing and clean power generation plant.

“We have been working diligently in obtaining our insurance wrap to protect our investment in the project, as well as receiving state approvals and executed agreements to proceed with acquiring the [200,000] sq ft property,” Sun Pacific Holding CEO Nicholas Campanella said.

The company also said it received a 100% tax abatement on property sales and use tax plus an inducement resolution for $50 million.

Soltage Gears Up for Illinois Solar Projects

Independent power producer Soltage is expanding its community solar portfolio with plans to construct three solar projects in Illinois under the state’s community solar program, the company said on April 4.

Combined, the projects—located in Freeport and Danville, Illinois—are expected to provide more than 10,000 megawatt-hours (MWh) of renewable energy per year and operate for at least 40 years. The projects will serve commercial, municipal and residential energy consumers in the area.

“We are proud to begin construction on an additional portfolio of projects in the great state of Illinois,” said Jon Cole, Soltage senior vice president of development. "Customers who subscribe to these projects receive significant savings on their electricity bills, as well as price certainty over time as these projects will be running for many decades."

Trina Solar, Al-Raebi Seal 500-MW Module Deal

China-headquartered Trina Solar agreed to supply Al-Raebi for Trading with 500 MW of module shipments for the Yemeni market as part of a five-year partnership agreement, according to an April 4 news release.

The agreement follows a similar deal last year for 400-MW n-type modules.

Trina Solar will initially supply Al-Raebi with 100 MW of Vertex N modules, an upgraded module with improved efficiency, this year.

“Our long and prosperous relationship with Al-Raebi allows us to deliver the power, efficiency and reliability needed to accelerate the adoption of clean energy in the Yemeni market,” said Antonio Jimenez, managing director and vice president of Trina Solar’s Middle East operations.

Serbia’s DeLasol Opens Country’s Largest Solar Park

The biggest solar park in Serbia’s push into renewable power was completed in late March and began operations on April 5, owner and operator DeLasol said in a statement.

Serbia, which produces most of its electric power from aging coal-fired plants, plans to increase the output from renewable energy sources to 40% of total production by 2040.

DeLasol was formed as a special purpose vehicle for the construction of the solar plant in the town of Lapovo. Four more plants with the same production capacity will be built over the next two years, owner Milos Kostic told Reuters.

With its installed solar panels’ capacity of 11.8 MW, the plant in Lapovo will be able to produce enough electricity for 2,100 households, said Kostic, who also owns Serbia’s leading solar park construction company MT-KOMEX.

Mining and Energy Minister Dubravka Djedovic said that cooperation between the public and private sectors is required for a successful transition to green energy.

Wind

Ørsted, Google Ink Their First US Power Purchase Agreement

Tech giant Google and renewable energy producer Ørsted said on April 3 they signed a power purchase agreement for energy generated at the Helena Wind Farm in South Texas, marking their first such agreement in the U.S.

The 150-MW, 15-year agreement is expected to help Google move closer toward its goal to operate all of its data centers, cloud regions and offices on renewable power by 2030.

“Building a 24/7 carbon free energy portfolio requires us to blend various resources to optimize for hourly production, and that’s exactly what this project helps us accomplish,” Sana Ouji, energy lead for Google, said in a news release.

Located in Bee County, Texas, the 268-MW, Ørsted-operated Helena Wind Farm was commissioned in mid-2022. The wind farm features more than 60 Vestas turbines spanning about 15,000 acres in Pawnee, Texas. The wind farm is part of the Helena Energy Center, which also includes a 250-MW solar farm called Sparta.

The power purchase agreement is the second agreement globally between Ørsted and Google.

“As a trusted partner in providing clean energy solutions for our customers, we’re proud to support Google’s decarbonization goals on both a regional and global scale,” said Monica Testa, head of origination for Ørsted Americas. “Google’s leadership in the investment of renewable energy and commitment to advancing 24/7 carbon-free energy by 2030 sets a strong example for companies across the globe, and we look forward to helping them achieve that ambition.”

DNV Begins JIP Focused on Wind Farm Control Technology

DNV has teamed up with several energy companies to launch a joint industry project focused on wind farm control technology, the Norway-based energy expert and assurance provider said on April 4.

The intent is to confirm the potential of wind farm control, which DNV said “covers the models and procedures required to control each turbine in a wind farm through approaches such as wake steering and induction control, in a way that optimizes the wind farm’s total output or overall performance.”

The technology enables operators to optimize loading across turbines and extract more energy.

“DNV launches this joint industry project to demonstrate the value of this promising wind control technology, which may become as common as energy yield assessment and equally necessary to wind projects,” Ditlev Engel, CEO of energy systems for DNV, said in a news release.

Participating companies include EDF Renewables, Enel Green Power, Engie, Equinor, GE Renewable Energy, Greencoat, Iberdrola/Scottish Power, Pattern, RES, RWE, Shell, Vestas, Windey and Ørsted, according to the release.

Ocean Winds, Partners Reach FID on Wind Park Offshore France

Ocean Winds and partners have taken a final investment decision on the €2.5 billion (US$2.7 billion), 500-MW Îles d’Yeu and Noirmoutier wind farm project offshore France, the company said on April 6.

The project secured public and private financing led by the Japan Bank for International Cooperation and a syndicate of 16 banks, according to the release. The financing paves the way to the start of construction.

“A new page is being written with the start of the construction phase, a stage during which we will continue to enthusiastically mobilize our know-how and our experts in order to meet the challenges of this collective project,” said Paolo Cairo, president of the Eoliennes en Mer des iles d’Yeu et de Noirmoutier (EMYN), the project company comprised of shareholders from Ocean Winds, Sumitomo Corp., Banque des Territoires and Vendée Energie.

Developers said the project will supply nearly 800,000 people with electricity each year.

Initial offshore operations will begin this summer with installation operations commencing in 2024, Ocean Winds said in a news release. Commissioning is expected in the second half of 2025 following a 2.5-year construction phase.

Several companies have already been tapped to carry out work for the project. Chantiers de l’Atlantique will build the electrical substation and Louis Dreyfus TravOcean will install the first submarine cables. DEME and Jan de Nul will be responsible for the transport and installation of the foundations and wind turbines, which will be made by Siemens Gamesa and installed in 2025.

Reuters contributed to this article.