Leading industrial gases company Air Products and energy provider AES announced today plans to invest $4 billion to build the first “mega-scale” green-hydrogen production facility in Texas.
With anticipated capacity of over 200 metric tons per day of hydrogen, and including approximately 1.4 gigawatts (GW) of wind and solar power generation, the project is expected to be the largest green hydrogen facility in the U.S.
The project, targeted to begin commercial operations in 2027, will serve the growing demand for green hydrogen from states and corporations aiming to incorporate zero-carbon intensity fuels into their net-zero targets. Green hydrogen is specifically relevant for the mobility market, as well as other industrial markets.
Seifi Ghasemi, Air Products’ Chairman, President and Chief Executive Officer, said:
“We have been working on the development of this project with AES for many years and it will be competitive on a world-scale while bringing significant tax, job and energy security benefits to Texas. We are excited to move forward and make clean green hydrogen available to U.S. customers in the near future.”
Hydrogen is viewed as one of the key building blocks of the transition to a cleaner energy future, particularly for sectors with difficult to abate emissions, in which renewable energy solutions such as wind or solar are less practical.
Around 90 million metric tons of hydrogen are produced annually, although the vast majority is extracted using fossil fuels, which create pollutants and GHG emissions. Significant investments are required to develop clean extraction processes, such as green hydrogen, which uses a renewable energy-powered electrolysis process to extract hydrogen from water.
Slated to begin commercial operations in 2027, the new facility will supply green hydrogen to the transportation and industrial markets in the U.S., addressing growing demand for zero-carbon intensity fuels.
According to Air Products and AES, the facility will help to avoid more than 50 million metric tons of CO2 over its lifetime, equivalent to the emissions from nearly five billion gallons of diesel fuel.
Air Products and AESwill equally own the renewable energy and electrolyzer assets, with Air Products serving as the exclusive off-taker and marketer of the green hydrogen under a 30-year contract.
AES President and Chief Executive Officer Andrés Gluski stated:
“We are very pleased to partner with the world leader in hydrogen, Air Products, for this first of its kind mega-scale green hydrogen facility in the United States. We will build more than 1 GW of new solar and wind facilities to provide zero carbon energy for electrolysis and related production facilities. AES believes that green hydrogen has a key role to play in decarbonizing transportation and accelerating the future of energy.”