Spanish oil giant Repsol is planning to invest more than €1.3bn ($1.5bn) in green hydrogen production by 2025, putting it at the forefront of the growing clean H2 sector.
The company said it will invest €338m in electrolysers, €700m in 1.8GW of wind and solar projects to power them, and a further €273m on biomethane steam reforming over the next four years.
This includes €179m in 232MW of electrolyser capacity at its three largest oil refineries, a further €32m in a 10MW electrolyser at its planned synthetic fuel pilot plant in Bilbao, and another €102m in 110MW of electrolysers to be owned by joint ventures with third parties.
Repsol will also plough €273m into biomethane steam reforming by 2025, producing the equivalent to 200MW of electrolyser capacity.
Because biomethane is produced from plant matter that absorbed CO2 from the air as it grew, the gas — which is produced in large tanks known as anaerobic digesters — is said to be carbon neutral when burned or cracked.
The Spanish company says it will require 3.25MW of renewable energy for each megawatt of electrolyser, with 70% of the electricity produced from its wind and solar plants being used for hydrogen production, and 30% sold to the grid.
Repsol also plans to scale up its green hydrogen production to 1.9GW of electrolysis equivalent, between 2025-30, according to director of hydrogen, Tomas Malango.
Earlier this week, the company said it had produced its first batch of biomethane-based green hydrogen — ten tonnes’ worth — at its Cartagena facility in southeast Spain.
Repsol said its green hydrogen investments are not expected to break even before 2025, but will then generate earnings (before interest, taxes, depreciation and amortisation) of €1.24bn in 2026-30 and €2.37bn in 2031-35.
Because Spain has the strongest solar irradiation in Europe, it is said to be the best place on the continent to develop green hydrogen.
"If hydrogen is going to fly in Europe, Spain is going to be at the head of it and Repsol has the size, teams and capacity to make that happen," said chief executive Josu Jon Imaz.