By Bethany Blankley
The Center Square , December 27,2022
The first mega-scale green hydrogen production facility in the U.S. will be built in North Texas. On Thursday, Air Products and The AES Corporation announced they planned to invest $4 billion to build, own and operate a green hydrogen production facility in Vernon, Texas, located in the rural north Texas county of Wilbarger, which borders Oklahoma.
The mega-scale renewable power to hydrogen project includes about 1.4 gigawatts of wind and solar power generation, along with electrolyzer capacity capable of producing over 200 metric tons per day of green hydrogen, making it the largest green hydrogen facility in the United States, the companies said in a joint news release.
They expect the facility to begin commercial operations in 2027. The goal is to meet a “growing demand for zero-carbon intensity fuels for the mobility market as well as other industrial markets,” the companies said. The facility “will yield a totally clean source of energy on a massive scale, and, if all the green hydrogen were used in the heavy-duty truck market, it would eliminate more than 1.6 million metric tons of carbon dioxide (CO2) emissions annually when compared to diesel use in heavy-duty trucks,” they added. “Over the project lifetime, it is expected to avoid more than 50 million metric tons of CO2, the equivalent of avoiding emissions from nearly five billion gallons of diesel fuel.”
Air Products and AES will jointly and equally own the renewable energy and electrolyzer assets, the companies said, with Air Products serving as the exclusive off-taker and marketer of the green hydrogen under a 30-year contract. Alberta Investment Management Company is an investor in AES’ clean energy business in the U.S., with 25% ownership in the business’ growth projects.
Gov. Greg Abbott said the new facility will enable Texas to “extend its leadership in U.S. energy production and help meet our country’s energy needs for decades to come.”
The new facility will be “competitive on a global scale while bringing significant tax, job and energy security benefits to Texas,” Air Products Chairman, President, and CEO Seifi Ghasemi said, adding that it “will be, by far, the largest, fully integrated green hydrogen production facility in the country, using wind and sun energy to produce clean hydrogen for U.S. customers.”
AES President and CEO Andrés Gluski said the project “will capitalize on AES’ strength in energy innovation and Texas’ abundant renewables resources to extend Texas’ leadership position in the energy sector.”
AES states on its website that green hydrogen “is key to reaching net-zero by eliminating emissions from difficult to decarbonize sectors” and that it “can eliminate emissions in the industry’s most difficult to decarbonize sectors.”
Business Development Corporation of Vernon Member Rick Hardcastle said the new facility “is a game changer for Wilbarger County,” because of “the significant new jobs to be created during construction and beyond. With this project, we’re entering an exciting next chapter.”
The project is expected to create more than 1,300 construction and 115 permanent operations jobs, and roughly 200 transportation and distribution jobs. It’s also expected to generate approximately $500 million in tax benefits to the state over the course of the project’s lifetime.
The tax contribution to the state over the project’s lifetime is equivalent to half of what the Texas oil and natural gas industry pays in one month.