The Advanced Clean Energy Storage (Aces) hub in Utah—the world’s largest industrial green hydrogen production and storage facility—should finish its initial financing this quarter, according to co-developer Magnum Development.

Haddington Ventures, the financial adviser for the hub and equity sponsor of Magnum Development, is securing $650mn for the project through its equity syndication programme.

And the US Department of Energy last week issued a conditional commitment for up to $504.4mn in debt financing for the hub.

These critical investments will ensure the future growth and scalability of the Aces hub, according to Dave Webster, COO of Magnum Development.

“It is the first real demonstration of seasonal storage for renewable energy in the US, if not in the world,” says Webster. “I think we are first out of the gate here.”

“It is the first real demonstration of seasonal storage for renewable energy in the US” Webster, Magnum Development

The hub will generate 100t/d of green hydrogen through 220MW via alkaline electrolysers manufactured by Hydrogenpro of Norway. Initially, the hub will be able to provide more than 300GWh/yr of clean energy to the western US.

The hydrogen will be stored in two natural salt caverns at the site. Utah-based Intermountain Power Agency (IPA) will construct an 840MW hydrogen-ready gas-fired power plant at an adjacent site that will initially run on a blend of 30pc green hydrogen and 70pc natural gas, rising to 100pc green hydrogen by 2045. The project is called IPP Renewed and will be supplied by hydrogen from the Aces hub.

Site preparation for IPP Renewed has started, according to IPA spokesman John Ward, and the project has just priced the first tranche of municipal bonds to finance its construction. Clients include the country’s largest municipal utility, the Los Angeles Department of Water and Power.

Developers also hopes to supply hydrogen to nearby industry and transport applications, according to Webster.

Renewable coalition

IPA is a generating cooperative of municipalities, rural electric cooperatives and municipal utilities in Utah and southern California. Each member will bring its own renewable energy to the green hydrogen hub, typically in the form of curtailed energy to reduce costs, according to IPA.

But some have questioned the economics of IPP Renewed. Martin Tengler, senior hydrogen analyst at research firm BloombergNEF, noted the inefficiency of converting renewable energy into hydrogen, compressing it for storage and then burning it in turbines. For every 1kWh of renewable energy input, only 0.3kWh would be produced by the plant for sale, according to BloombergNEF analysis.

In response, IPA says seasonal storage will help project participants achieve their aggressive decarbonisation goals.

“There is no way to achieve [these] without seasonable dispatchable energy storage,” says IPA spokesman John Ward, noting that falling costs of production will also improve efficiency over time.

Additionally, IPP Renewed has one DC transmission line to southern California that needs a consistent generating source in Utah.

The Aces developers see the hub as the first phase of a regional project. The site could accommodate as many as 70 caverns, depending on their size, according to Webster. If IPA Renewed is using 100pc hydrogen by 2045, that will require the use of more than two caverns.

Aces Delta is a joint venture between Florida-headquartered Mitsubishi Power Americas and Magnum Development.

“We are unbelievably excited to reach this important milestone, not just for our hub, but for the hydrogen industry as a whole,” says Michael Ducker, senior vice-president of hydrogen infrastructure for Mitsubishi Power.

---

Author: Ros Davidson