Portugal-based EDP Group announced on February 19 that it will establish two new business units. One of them will concentrate on the development of technologies related to green hydrogen, while the other will be targeting the market for energy storage. The EDP Group is a major European provider of energy solutions and has a presence in numerous regional markets.
The green hydrogen unit is currently named H2BU and will be directly under the control of the EDP Group. As for the energy storage unit, it will be under the control of the North American branch of EDP Renováveis (EDPR), a subsidiary of the EDP Group. EDPR is a developer of renewable energy projects with a focus on wind power. However, the company has also been involved in the PV sector. According to the press release about the new business units, the immediate goal of the energy storage unit is to attain a project portfolio of 1GW by 2026.
So far, EDPR has only a few renewable projects with a significant energy storage component. These include a wind farm and a solar park in Romania and a solar park in the US. The PV-plus-storage project in the US is located in California. Named Sonrisa, it is still in development and scheduled for operation in 2022. Its generation capacity and storage capacity are 200MW and 40MW respectively.
Miguel Stilwell de Andrade, CEO of EDP Group, said that energy storage systems have become increasingly important as the range of applications for renewable energies widen. He pointed out that energy storage batteries provide renewable generation systems with the necessary supply flexibility. This, in turn, contributes to the market growth of renewable energies as a whole.
With regard to H2BU, the EDP Group considers green hydrogen as a growth pillar of its operations. The cost using renewable energies to manufacture hydrogen fuel is going down. At the same time, many countries have set ambitious targets for curbing CO2 emissions. As a result, the green hydrogen market is steadily gaining attention from various energy companies and investors.
Hydrogen is a cleaner alternative to natural gas for certain vehicles and industrial activities that cannot be “electrified”. With North America and Europe serving as its main regional markets, H2BU will be developing green hydrogen solutions that complement EDPR’s existing portfolio. The target applications of its solutions include steel production, chemical production, cement production, petroleum refining, and long-haul and heavy-duty transportation.
The EDP Group is currently working on two green hydrogen projects: H2Sines and BEHYOND. The former is a green hydrogen production center in Portugal, and the latter is a pilot project that will be testing the feasibility of using offshore wind energy to produce hydrogen. H2Sines is a pan-European initiative, whereas BEHYOND is a collaboration between Portugal and Norway. It should also be pointed out that the EDP Group is a member of the newly formed European Clean Hydrogen Alliance that has an agenda to invest 430 billion euros into the development of hydrogen fuel infrastructure by 2030.
Stilwell de Andrade also said that even though renewable energies and electrification of energy consumption together constitute the most cost-effective means for achieving carbon neutrality, other “energy vectors” like green hydrogen is still needed to meet the demand of specific sectors where electricity is unsuitable for economic or technical reasons.
Various media outlets have reported that the EU has formulated an ambitious strategy for green hydrogen. It calls for 40GW of hydrogen production (or eletrolyser) capacity that is powered by an estimated 80-120GW of renewable energies by 2030.