Brazil could take the lead in exporting green hydrogen says Armando Juliani, Siemens Energy Brazil's head of services and solutions. He spoke to Argus about the country's potential for offering the lowest hydrogen production costs in the world. Edited highlights follow.
How close is Brazil to having hydrogen plants?
Very close.
Brazil has a very large potential for generating energy with green hydrogen. We are talking about 200-300GW — three times more than all renewable energy produced by the country today.
We see hydrogen production in Brazil coming in two waves. The first would use existing industrial assets. Some clients have already started projects like this. So, I would say that within this wave, in three or four years, we will produce green hydrogen in Brazil.
A second wave, with large blocks of green energy generation producing green hydrogen for export, will start around 2030.
We need, in both cases and especially for the second wave, better regulation and definitions of policies for green hydrogen and its pricing.
Is Brazil expected to be an important participant in this market?
Yes, for several reasons. Brazil generates power from all sources. But unlike other countries, 80pc of the energy it produces is renewable.
Therefore, we are in an advantageous position for the adoption of green hydrogen. We should become one of the lowest cost producers in the coming years.
The proximity to some markets that are increasingly valuing hydrogen, such as Europe, is also a factor.
Can offshore wind power boost green hydrogen production in Brazil?
In a second wave, offshore wind is among the alternatives for producing green hydrogen fast and in large quantities.
As an equipment manufacturer, Siemens Gamesa has contributed to this trend. We have, for example, a wind turbine coupled to an electrolyser. It produces hydrogen directly from the turbine. We expect to invest €40mn ($3.97mn) in this project.
Siemens Energy is also working on the large-scale production of green hydrogen to generate e-fuel. In Chile, we have a project called Haru Oni that takes advantage of the strong and constant winds in the Chilean Patagonia region. The same power used for producing green hydrogen captures CO2 and generates a green hydrocarbon. This plant is still working on a reduced scale, but the idea is to expand it.
Why will green hydrogen prices be competitive in the global power market? Can we expect it to be competitive within Brazil as well?
We know that Brazil, because of its large green power generation, will have the lowest marginal cost for hydrogen production on the planet.
The price will be competitive outside the country for two reasons. First, because of the need for decarbonization. Second, because of the incentives that countries will grant to produce green hydrogen.
It is hard to say if it will be competitive in Brazil, because we have domestic green solutions. But hydrogen is going to be extremely important for the entire world someday because it can be exported.
Would a hydrogen certificate be important for this market's development ?
The creation of a certificate is critical. For Brazil to be a leader in this energy transition to a low-carbon economy, it is essential that we know what kind of green energy can be used to export hydrogen.
How buyers define renewable energy can affect green hydrogen production. One philosophy for green energy says it is not enough for a plant to be green. Instead, it must replace non-green energy. So, in theory, a hydroelectric plant that already exists could not produce hydrogen, for example.
