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Air Products, AES Partner On $4 Billion Green Hydrogen Plant

With governments worldwide pushing green hydrogen as a more sustainable alternative to fossil fuels, you can expect to see a lot more of it in the years to come. According to Grandview Research, its global market was valued at $3.2 billion in 2021 and is projected to top $60 billion by 2030

Getting there will require sizeable investments in plants that produce green hydrogen, which involves using electrolysis to split water and separate the chemical element from the oxygen. Renewable energy sources such as wind and solar power the process, so no carbon dioxide is emitted. 

One such investment was announced in early December when industrial gas supplier Air Products and renewable energy company AES Corp. announced plans to spend about $4 billion to build the largest green hydrogen facility in the U.S.

The facility will be located in Wilbarger County, TX, and is expected to begin commercial operations by 2027. Once it is up and running, it will be capable of producing more than 200 metric tons of green hydrogen daily. The companies will share the investment equally, and both will have equal ownership of the plant’s renewable energy and electrolyzer assets.

Photo Courtesy AES Corp

Air Products, headquartered in Allentown, PA, will serve as the exclusive acquirer and marketer of the fuel from the plant under a 30-year agreement. AES, based in Arlington, VA, is one of the nation’s largest renewable energy developers and will oversee that end of the project.

Air Products and AES said the Texas facility includes about 1.4 gigawatts (GW) of wind and solar power generation. The two companies aim to meet the growing demand for zero-carbon fuels for mobility and other industrial markets. Over the project’s lifetime, it is expected to help avoid more than 50 million metric tons of CO2 or roughly the equivalent of 5 billion gallons of diesel fuel. 

The project is also forecasted to create more than 1,300 construction, 115 permanent operation, and about 200 transportation and distribution jobs.

In addition, it’s predicted to generate about $500 million in tax benefits to Texas throughout the project’s lifetime. 

Photo Courtesy Air Products

“The new facility in Texas will be, by far, the largest mega-scale clean hydrogen production facility in the U.S. to use wind and sun as energy sources,” said Seifi Ghasemi, Air Products president and CEO. “We have been working on the development of this project with AES for many years, and it will be competitive on a world scale while bringing significant tax, job, and energy security benefits to Texas.”

Hydrogen is considered vital to speeding the transition to clean energy, especially in sectors of the economy that can’t rely solely on renewable energy. About 90 million metric tons of it are produced each year, ESG Today reported. Companies extract the vast majority using fossil fuels, which create pollutants and greenhouse gas emissions. Green hydrogen provides a way to avoid these outcomes.

Photo Courtesy Air Products

“We are very pleased to partner with Air Products for this first-of-its-kind mega-scale green hydrogen facility in the United States,” said Andrés Gluski, AES President and CEO. “AES believes that green hydrogen has a key role to play in decarbonizing transportation and accelerating the future of energy.”  


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