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1 March 2023

Is BP greenwashing with plans for 2GW H2 plant in Valencia?

Excuse our approach to BP news but when plans for a new 2GW green hydrogen electrolysis plant landed on our front desk, we had to ask: have the BP shareholders finally turned a corner and become earnest?… Of course not, but that doesn’t take away from the fact that more green hydrogen will be produced as a result of this Spanish project.

Named HyVal, the green hydrogen cluster planned for the Castellón refinery in Valencia will be built in phases up until it reaches the full 2GW of electrolysis capacity in 2030. HyVal is expected to play an important role in decarbonizing the operations at BP’s Castellón refinery which currently uses grey hydrogen obtained from natural gas without capturing CO2. The company expects that the entire project will cost up to €2 billion including green hydrogen and biofuels production and renewable energy generation.

The first phase of the project is anticipated to become operational in 2027 and will involve the installation of an electrolysis plant with at least 200MW of capacity. This initial stage would be expected to produce up to 31,200 tons of green hydrogen per year. Use of this green hydrogen to replace natural gas is estimated to be able to avoid more than 300,000 tons of CO2 emissions per year.

In the second phase, which could be completed in 2030, the electrolysis plant would be expanded to reach a capacity of up to 2GW of net installed power. Green hydrogen production from such a facility could support both regional and national demand, alongside positioning Valencia as a hydrogen exporter to the rest of Europe through the Mediterranean corridor of green hydrogen called H2Med.

In terms of biofuels, the refinery will increase its production to 650,000 tons a year which represents a three-fold increase. One of the main biofuels planed for production is Sustainable Aviation Fuel (SAF) – if you are familiar with our work, you will know how we feel about SAF, but if you aren’t, find out more here.

In addition to being used at BP’s refinery, the green hydrogen produced will also be used in various industries in the Valencia region, such as the ceramic industry replacing the natural gas used in their processes, chemical industries for the production of green ammonia and in heavy transportation.

BP does have an aim of producing upwards of half a million tons of green hydrogen by 2030 and it intends to achieve that with the help of a number of hydrogen projects.

H2Teesside and HyGreenTeesside are new large-scale green hydrogen production facilities that BP is building in the UK, which will amount to 500MW of electrolysis capacity by 2030. Alongside Ørsted, BP is building an electrolysis plant in Germany at its Lingen refinery. The project, currently in the optimization phase, will benefit from 100MW of capacity. In Rotterdam, BP is teaming up with Netherlands-based firm HYCC to develop a 250MW plant which upon completion will be city’s largest green hydrogen project.

These, alongside projects in the US and Australia, symbolize BP’s aim to shift towards sustainable fuels production, but that doesn’t change what BP really stands for. No, it’s not British Petroleum, its Bigger Profits. One of the first things that BP wants you to know when you visit its website is that it has a 2050 net-zero target. But its Annual Energy Outlook, released only a month ago, still predicts plenty of oil will be used in 2050. So let me get this straight. BP wants to keep selling oil in 2050, and loads of it, which will be combusted in all sorts of ways and release CO2 that will contribute to climate change but its operations will be net-zero because it will show proof that it has captured some fugitive emissions and its offices and trucks will run on clean energy so it’s all good.