Spain sharply lifts renewable hydrogen targets

Spain is aiming to nearly triple its 2030 electrolyser capacity target to 11GW, while it wants 74pc of hydrogen used in industry to be renewable by then, according to a draft document released by the country's ecological transition ministry.

The targets outlined in the draft national energy and climate plan are the most ambitious released so far for any EU country.

Spain had previously set a 4GW target for 2030 in its national hydrogen strategy from 2021. The "notable increase in ambition" since then reflects the high rates of growth of installed renewable energy capacity and an increasing interest from companies looking to produce green hydrogen and derivatives in Spain, the ministry said. According to the ministry, Spain accounted for 20pc of the renewable hydrogen projects announced globally in 2022, second only to the US.

The 11GW aim would be the highest for any EU country. Germany had so far set the most ambitious target with 10GW, although Finland — which has only published a renewable hydrogen production target so far — may require a similar amount of electrolyser capacity for its output goal of 1mn t/yr by 2030.

While it may be the EU's ambitious target, the 11GW goal may in fact still be modest considering Spain's renewable hydrogen project pipeline. Spain's minister for ecological transition, Teresa Ribera, said this month on Twitter that the portfolio of planned projects has a total capacity that would quadruple the initial 4GW target. The president of Spain's Extremadura region, Guillermo Fernandez Vara, earlier this year said that electrolyser capacity could reach 16GW by 2030.

Consumption target

The target for renewable hydrogen in industry could also be nearly tripled, according to the draft document.

The draft foresees that 74pc of overall industrial hydrogen used would have to be renewable. This would be up from just 25pc envisaged in the 2021 hydrogen strategy.

It would also far outstrip the 42pc target foreseen under the EU's revised renewable energy directive RED III.

According to the ecological transition ministry, Spain currently consumes around 500,000 t/yr of mostly grey hydrogen, which is produced from natural gas with unabated emissions. This means that the 74pc target would equate to around 370,000 t/yr, although overall consumption may rise in the coming years. Of the current consumption, 70pc is used at refineries, 25pc in chemicals production and the remainder in the metallurgical sector, the ministry said.

The operators of Spain's largest refineries have already announced large-scale renewable hydrogen production projects as they seek to decarbonise their operations, including BP, Cepsa and Repsol.

The document separately envisages that 11pc of all transport fuels would be either renewable fuels of non-biological origin, effectively meaning renewable hydrogen and its derivatives, advanced biofuels or biogas. This is up from just 2.5pc targeted in the country's 2020 national energy and climate plan.

In any event, 11GW of electrolyser capacity could allow for renewable hydrogen production of over 1mn t/yr, meaning that Spain could have ample spare supply to export elsewhere, even if it meets or exceeds its ambitious consumption targets. Spain stands to become a key supplier of renewable hydrogen to northwest Europe, both via ship and via pipeline.

Renewable power growth

Hydrogen project developers are hoping to bank on Spain's ample power generation capacity which has grown considerably in recent years.

The ministry expects that renewable sources will account for 50pc of Spain's electricity mix this year, with its installed renewable capacity having climbed above 70GW, thanks to more than 27pc growth in 2019-22.

According to the updated targets, the ministry aims to have renewable sources representing 81pc of electricity generation by 2030, revised up from a 74pc target set in 2021.

Also part of the new targets is a boost in production of biogas and biomethane, which is expected to double to 20TWh in 2030.

A consultation on the ministry's draft plan is running until September and the final document is to be sent to the European Commission by June 2024.

By Pamela Machado and Stefan Krumpelmann