BP betting EUR2 billion on major Spanish green hydrogen hub

BP is set to invest up to EUR2 billion in a new green hydrogen cluster in the Valencia region (HyVal) at its Castellón refinery. 

The public-private collaborative initiative is intended to be based around the phased development of up to 2GW of electrolysis capacity by 2030 for producing green hydrogen at BP’s refinery.

HyVal is expected to play an instrumental role in decarbonizing the operations of BP’s Castellón refinery with the anticipated production of green hydrogen, biofuels and renewable energy.

Green hydrogen – generated by the electrolysis of water using renewable power – will support decarbonisation of the refinery’s operations, replacing its current use of ‘grey’ hydrogen generated from natural gas.

Its production of biofuels is expected to increase three-fold, to 650,000 tonnes a year 2030. Green hydrogen will also be used as a feedstock in biofuel production, specifically of sustainable aviation fuel (SAF).

HyVal was launched by Andrés Guevara, president of bp Energía España, in a presentation including Spain’s Minister of Industry, Commerce and Tourism, Reyes Maroto, the president of the Generalitat Valenciana, Ximo Puig, and the mayor of Castellón, Amparo Marco.

Andrés Guevara said: “We see Hyval as key to Castellón’s transformation and critical to supporting decarbonization across the Valencia region. We aim to develop up to 2GW of electrolysis capacity by 2030 for green hydrogen production, helping decarbonize our operations and customers. And we plan to triple the refinery’s production of biofuels to help meet the growing demand for lower carbon fuels such as SAF.”

“We believe HyVal can play an important role in Valencia region’s efforts to decarbonize and help support thousands of industrial jobs across the region.”

In addition to being used by BP at the refinery, the green hydrogen produced will also be used in key hard-to-abate 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 transport.

HyVal also aims to support the development of Valencia region into a leader for the production of green hydrogen in Spain. Its hydrogen production is expected to be developed in phases.

The first, anticipated to be operational in 2027, will involve the installation of an electrolysis plant with at least 200MW capacity at Castellón refinery. This initial stage would be expected to produce up to 31,200 tonnes 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 when used first in the refinery and then in thermo-intensive industries and heavy transport. This green hydrogen will also be used as a feedstock for the production of SAF (Sustainable Aviation Fuel), at the refinery.

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 world-scale plant could support both regional and national demand, as well as positioning Valencia region to export green hydrogen to the rest of Europe through the Mediterranean corridor of green hydrogen H2Med.

HyVal is expected to play an instrumental role in decarbonizing the operations of BP’s Castellón refinery with the anticipated production of green hydrogen, biofuels and renewable energy.

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