The promoters of the Hydeal Spain “gigaproject”, the spearhead of the world’s largest initiative for the production, transport and consumption of renewable hydrogen, assure that they will be able to supply all the renewable gas that ArcelorMittal will need to start producing green steel in Gijón in 2025. There are 150,000 tons of hydrogen per year that will prevent the steel company from having to use natural gas as a transition source between coal and renewables.
The strong demand for green hydrogen that Arcelor will have with its decarbonization plan is the main driver of the HyDeal Spain “gigaproject”. Fertiberia has joined the demand from the steel company, which will take advantage of the supply to create a green ammonia plant in Trasona. These two companies will not only be consumers in the HyDeal Spain project. Their involvement goes further and they will also be investment partners together with Enagás and DH2 Energy, the other two members of the alliance.
The plan includes the creation of a network of 15 green hydrogen production points with electrolysers powered by renewable energy obtained from photovoltaic solar plants that will be located mainly in Castilla y León. Electrolyzers and solar plants will be very close to avoid energy losses in transport and the sets will be concentrated to facilitate the transport of hydrogen production to Asturias through existing gas pipelines to which exclusive hydrogen pipelines could be added. The Ruta de La Plata gas pipeline, connection between La Meseta and Asturias, will be key.
Sources from the HyDeal Spain alliance pointed out that there is still no closed estimate of the investment that will be needed to create this scalable green hydrogen network that will have an installed capacity of 9,500 megawatts (MW) and that will supply electricity to 7,400 MW of power. electrolysis in 2030. “Obviously we are talking about billions of investment,” said these sources, who added that the financing model for the project is currently being built, which will not be dependent on public aid, although it will be eligible. The Minister of Industry, Kings Marotoassured yesterday that the project “will have the support of the Government of Spain”.
ArcelorMittal will replace one of the Gijón blast furnaces with a new plant for the direct reduction of iron ore (DRI system) with hydrogen. The company expects to start up the plant in 2025 and will already need an annual supply of 150,000 tons that year, which HyDeal Spain has committed to supply. In 2026, the alliance’s production would rise to 200,000 tons and the goal is to reach 6.6 million in the first 20 years, which represents an annual average of 330,000 tons. Bearing in mind that ArcelorMittal’s annual need is 150,000 tons, the difference will allow it to supply Fertiberia but also other industries and sectors such as mobility. “There are already interested Asturian companies,” sources from the alliance pointed out. ArcelorMittal and Fertiberia as investors would benefit from this entry of new consumers.
To guarantee the supply of 150,000 tons of green hydrogen to Arcelor already in 2025, a very rapid deployment of production and transport infrastructures will be necessary. The Spanish-French company DH2 Energy will be responsible for the development of production infrastructures. It shares investors with Dhamma Energy, which has completed the development of more than 650 photovoltaic MW. However, this company sold its activities in Spain to the Italian group Eni, with which it currently has no generation assets in Spain.
For the project to supply green hydrogen to ArcelorMittal DH2 Energy, it will have to start almost from scratch – in recent months it has negotiated the acquisition of surface rights for photovoltaic solar parks in the province of Zamora – or rely on other renewable promoters with advanced projects . HyDeal Spain is the first industrial implementation of the European HyDeal Ambition platform, which includes 30 companies in the hydrogen value chain, including companies such as Naturgy, with a broad portfolio of renewable energy projects in Spain. The European HyDeal Ambition project foresees an electrolysis power of 67,000 MW, the largest in the world according to the International Renewable Energy Agency.