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ABB joins alliance with Bair Energy for Texas green hydrogen complex

Bair Energy has selected ABB to join its Green Hydrogen and Technology Alliance as automation, electrification and digitalization expert.

ABB has been selected to join the Bair Energy Green Hydrogen and Technology Alliance to provide expertise on turnkey automation, electrification and digitalization solutions that support the optimization of low-cost green hydrogen production at the 1 GW Clear Fork Texas facility, according to a news release.

Phase one of the project will utilize renewable power to produce up to 33,000 kg of green hydrogen per day initially, with daily capacity designed to increase to 132,000 kg by 2028. The green hydrogen, which emits zero carbon when used as an energy source, will be liquefied on site, stored and transported to customers to help establish hydrogen networks in the mobility and transportation industry.

ABB Adaptive Execution™, a project methodology from design through to operations, will be employed to integrate expert teams, new technologies, agile processes and shared learnings. Using a portfolio of ABB products this helps customers reduce capital costs, while delivering projects ahead of schedule1.

The Memorandum of Understanding between ABB and Bair Energy provides scope to explore deploying digital twin technology enabled by the ABB Ability™ 800xA Simulator and ABB Ability™ Process Power Simulator. These solutions will integrate electrical and process controls with dynamic simulation to provide a virtual representation of how the plant is designed, operated and maintained. This enables a shorter new plant start-up period, helps train operators and tests changes in a realistic but disconnected environment.

With transportation the number one cause of greenhouse gas emissions in the United States2, the project aims to provide a significant step in the decarbonization of the US transport industry. Due to start operating in 2025, the Clear Fork Texas Project will be one of the largest locally produced green hydrogen facilities.

“We are particularly pleased to be part of this project to support low-cost hydrogen production, and sustainable transport in the US and globally,” said Brandon Spencer, President of ABB Energy Industries. “It is an exciting time for hydrogen in the US following the Inflation Reduction Act incentives passed last year, which coupled with alliance formations such as this, support projections3 of reducing the cost of green hydrogen production to under $0/kg by 2030.”

“Our collaboration with ABB, and their expertise in automation, electrification and digitalization solutions, will help us to bring the Clear Fork Texas Project one major step closer to success,” said Nicholas Bair, Chief Executive Officer of Bair Energy. “The deployment of ABB Adaptive Execution™ will also enable us to both reduce our CAPEX by 20 percent and speed up our delivery time of the facility by 10 to 20 percent, which is a game changer for a project of this scale.”

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United Airlines invests in microalgae-to-SAF startup

The investment comes from the new UAV Sustainable Flight Fund and will support the production of SAF made from algae.

United Airlines has invested $5m in algae biofuel company Viridos, a microalgae-to-fuels startup, according to a news release.

The investment comes from the new UAV Sustainable Flight Fund and will support the production of SAF made from algae.

Viridos has achieved seven times the oil productivity compared to typical wild-type algae, the release states. The company’s algae are grown in vessels containing seawater. This reduces the need for freshwater and eliminates runoff.

“By establishing production sites to grow Viridos-engineered microalgae in saltwater, we are creating the foundation for a biofuel future that moves away from fossil fuels without competing for precious resources such as fresh water and arable land, Oliver Fetzer, Viridos CEO, said in the release.

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Envusa Energy created by Anglo American and EDF

Anglo American and EDF Renewables have formed Envusa Energy to develop a regional renewable energy ecosystem in South Africa.

Anglo American and EDF Renewables have formed Envusa Energy to develop a regional renewable energy ecosystem (RREE) in South Africa, according to a news release.

The roll-out of the RREE will serve as an energy source for the production of green hydrogen for Anglo American’s nuGen Zero Emission Haulage Solution (ZEHS) – a planned fleet of hydrogen-powered ultra-class mine haul trucks to replace diesel, supporting the development of South Africa’s Hydrogen Valley.

In March the two companies signed a MOU to explore the ecosystem’s development. Envusa Energy is launching a  pipeline of more than 600 MW of wind and solar projects in South Africa – a major first step towards the development of an ecosystem that is projected to generate 3-to-5 GW of renewable energy by 2030.

This first phase of Envusa’s renewables projects is expected to be fully funded – including by attracting debt financing that is typical for high quality energy infrastructure projects – and ready for construction to begin in 2023.

Envusa is expected to supply Anglo American with a blend of renewable energy generated on Anglo American’s sites and renewable energy transmitted via the national grid. This energy portfolio approach will aggregate energy from geographically dispersed renewable generating assets and allocate this energy optimally to meet the load demand for Anglo American’s sites.

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Developer files for permit to construct green ammonia facility near Corpus Christi

A developer has filed for a permit to construct an 800,000-tons-per-year facility near Corpus Christi, on which it expects a final investment decision in 2Q24.

Avina Clean Hydrogen has applied for a permit to construct a green ammonia facility in Robstown, Texas, near Corpus Christi.

An Avina subsidiary, Nueces Green Ammonia, LLC, filed for the permit in late December with the Texas Commision on Environmental Quality.

Nueces Green Ammonia is a proposed world-scale anhydrous ammonia facility with a production capacity of 800,000 metric tons per year.

The total expected capital investment for the project is $2.2bn, and a final investment decision is expected for 2Q24, according to the project website.

ReSource previously reported that Avina was auditioning bankers to raise debt and equity capital in support of its projects.

Avina did not immediately respond to a request for comment.

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Developer Profile: Green hydrogen developer finds strength in numbers

Clean Energy Holdings is assembling a coalition of specialized companies as it seeks to break into the novel green hydrogen market.

Nicholas Bair draws a direct line from his childhood on an Oregon dairy farm to the coalition of specialized companies that, as the CEO of Clean Energy Holdings, he is now assembling in pursuit of key-player status in the green hydrogen industry.

“We created our own milk from our own hay,” he says, of his family’s organic dairy farm in Klamath Falls, near the California border. He adds, using an expression he often repeats: “Everything was inside the battery limits.”

This phrase – “inside the battery limits” – represents what Bair, who is forty-one and a chemist by trade, is trying to achieve with The Alliance: a broad, self-contained battery of partners with specialized competencies working in coordination on the challenges of developing and operating groundbreaking green hydrogen projects.

“We’re doing everything from soup to nuts,” he says.

CEH and The Alliance are planning to build roughly $1bn worth of projects per year over the next ten years, Bair says. As a launching point, the parties are advancing a green hydrogen facility – called Clear Fork – near Sylvester, Texas that would churn out 30,000 kg per day in phase 1 starting in 4Q24. The hydrogen would be produced using electrolyzers powered by a 325 MW solar farm, while ancillary facilities at the site would be powered by a gas turbine capable of blending up to 70% hydrogen.

As members of The Alliance, Equix Inc. is acting as the EPC for the solar and gas turbine portion of the project, while Chart Industries is providing tankers, trailers, and liquefaction to transport hydrogen from the site in northwest Texas. Meanwhile, Hartford Steam Boiler – an original contributor to standards written by the American Society of Mechanical Engineers – will provide quality assurance and control; Coast 2 Coast Logistics is responsible for trucking; and The Eastman Group provides permitting and facilities management.

‘First-of-kind’

Although a renewable project, the green hydrogen concept is similar to most refinery EPC contracts, since many of them are first-of-kind with significant liquidated damages, Bair says. Additionally, the green hydrogen projects are “married to renewables, and you need the cryogenics and the distribution in between.”

Before starting Clean Energy Holdings, Bair was the founder and CEO of Bair Energy, a program and construction manager for infrastructure and energy projects – a service that Bair Energy is providing as a member of the Alliance. A period of low natural gas prices made Bair Energy’s specialty – geothermal power – less competitive, and Bair, seeking to develop his own projects instead of managing projects for others, sought to branch out into new types of energies.

Bair Energy itself consists of professionals that have been cherry-picked from the industry, Bair says. Candice McGuire, a veteran of Shell and Technip, is Bair’s chairman; chief operations officer John Strawn recently joined from Technip; and wind-industry veteran Peder Hansen has joined as VP and chief engineering manager.

“Our experience on the team is taking first-of-kind, developing it, and getting it to market,” he says. With The Alliance, “We went out and found the best at what they do, put them on lump-sum order, and brought them to the table early to figure out how to make their product talk to the other person’s product, so we can have a guarantee,” he says.

What distinguishes Clean Energy Holdings from other green hydrogen developers is, in fact, the coalition it is building, says Elizabeth Sluder, a partner at Norton Rose Fulbright who is CEH’s legal advisor.

“It’s intended to be one-stop shopping in a vertically integrated structure such that as and when needed for future CEH projects or third party projects that are identified, you have all the various players you need to take it from point A to point B,” she adds.

Because the parties are on standby with a common goal, CEH and its partners can provide lump-sum turnkey services, with some element of bulk pricing potentially factored in, because savings are generated through not having to issue RFPs for partners in future projects.

“The savings in time and money is, I would expect, very valuable,” Sluder says. “And when you apply those principles to long-term strategy and equity investment-type opportunities, the lower capex spend should theoretically benefit the project at large.”

Keeping the pieces moving

Bair runs CEH alongside Co-Founder and President Cornelius Fitzgerald. The two met as children – Fitzgerald was raised on a nearby cattle farm in southern Oregon – and enjoy the uncommon chemistry of childhood friends.

In something of classic pairing, “I’m much more the trumpet, paving the path,” Bair says, while Fitzgerald “usually keeps the pieces moving.”

“Sometimes Cornelius has had the best cup of coffee and takes the lead in meetings. And sometimes I do,” he says. “It’s that ability to rely on each other that set the basis of design in my mind for what a good partner looks like.”

Fitzgerald says they approach the challenge of breaking new ground in green hydrogen with “quiet confidence and humility.” By having a big picture vision as well as “credible and tangible fundamentals for the project” – like land, resource, and water control – the project moved from an idea to a reality, he adds.

“And really we’ve been driving at how to get the best experience and expertise at the table as early as possible,” Fitzgerald says.

Equix, Inc, a civil engineering firm, joined the grouping to build the solar and gas generation portion of the facility, representing the company’s first-ever foray into a hydrogen project, says Tim LeVrier, a vice president of business development at the firm.

“There are many challenges integrating all these types of power sources and energy into creating hydrogen,” Levrier says. “From an electrical engineering standpoint it is extremely challenging to coordinate power switching from one source to another. Another consideration we are having to work through is what to do in regards to producing hydrogen at night. Will there be a battery portion to the project or do we just not produce hydrogen when it is dark? These are all things we are considering and will have to find creative solutions for.”

‘Pathological believer’

CEH recently added Chart Industries to The Alliance, which in addition to furnishing liquefaction, tanks and trailers to move hydrogen, will provide fin fans for cooling and a reverse osmosis system for cleaning water. “We don’t want to give away all our secrets,” Bair says, “but it’s a very efficient process.”

The unique perspective and expertise of partners in The Alliance makes for a fulsome ecosystem around any CEH project, says Jill Evanko, CEO of Chart Industries. With respect to CEH’s projects, Evanko says they are “very targeted, which, with focus, will continue to help evolve the hydrogen economy.”

“Chart’s hydrogen liquefaction process as well as associated hydrogen equipment including storage tanks and trailers” – which the company has been manufacturing for over 57 years – “will be sole-source provided into the project. This will allow for efficient engineering and manufacturing to the CEH Clear Fork project schedule,” she says.

In any molecule value chain, hydrogen included, Chart serves customers that are the producers of the molecule, those who store and transport it as well as those who are the end users, Evanko adds. “This allows us to connect those who are selling the molecule with those who need it.”

Looking ahead, CEH is preparing to meet with investors in the lead-up to an April, 2023 final investment decision deadline for the Texas project. And it is being advised by RockeTruck for another RFP seeking fuel cell vehicles to transport hydrogen from the site as the trucks become available – a design that will likely include hydrogen fueling stations at the production facility as well as at the Port of Corpus Christi, Bair says.

CEH also has plans to develop its own geothermal plants and explore the role that nuclear energy can play in green hydrogen. Bair Energy recently hired Eric Young as its VP of engineering and technology from NuScale, where he worked on the research team that received approvals from the U.S. Nuclear Regulatory Commission for a small modular nuclear reactor.

“We’re a technology-driven owner-operator,” Bair says. “We’re all technologists, which means we’re pathological believers in technology. We’re all looking for transformational energy.”

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Mitsubishi laying groundwork for additional equity raise

Mitsubishi Power Americas and its JV partners are preparing to raise additional equity for the ACES Delta project in Utah, as well as for other hydrogen developments in the Americas.

Mitsubishi Power Americas is conferring with its financial partners to raise equity from existing investors in the Advanced Clean Energy Storage (ACES) Delta green hydrogen project in Utah, Senior Vice President, Investment and Business Development Ricky Sakai said in an interview.

Haddington Ventures formed Haddington ESP I and raised $650m in June 2022 from institutional investors to fund projects developed by ACES Delta, which is a joint venture between Mitsubishi Power Americas and Haddington portfolio company Magnum Development.

The investors — AIMCo, GIC, Manulife Financial Corporation, and Ontario Teachers’ Pension Plan Board — have additional rights to increase their collective investment to $1.5bn, according to a press release announcing the deal.

The first phase of the project in Utah will be to produce 100 tons of hydrogen per day. Once that is complete, existing investors can scale up their investment, Sakai said.

ACES Delta rendering

Mitsubishi is involved in several regional hydrogen hubs applying for funding from the US Department of Energy.

Hydrogen capable

Depending on how that $7bn is ultimately allocated, Mitsubishi is interested in replicating the Utah project in other regions, a source familiar with the company said.

MPA and Magnum recently closed on a $504.4m loan guarantee from the DOE for ACES Delta, electrolyzers for which will be supplied by Norway-based HydrogenPro.

ACES Delta will support the Intermountain Power Agency’s IPP Renewed Project — upgrading to an 840 MW hydrogen-capable gas turbine combined cycle power plant using Mitsubishi’s M501JAC gas turbines. The plant will initially run on a blend of 30% green hydrogen and 70% natural gas starting in 2025 and incrementally expand to 100% green hydrogen by 2045.

Mitsubishi is also supplying the hydrogen-capable gas turbines to Entergy’s Orange County Advanced Power Station; to an Alberta coal plant owned by Capital Power; and to J-Power’s Jackson Generation Project in Illinois, which reached commercial operations last year.

Mitsubishi Power

Investing in startups

Mitsubishi is doubling down on a strategy of investing in startup producers and technology in renewable fuels, Sakai said.

Recent investments in the space include: C-Zero, a drop-in decarbonization tech startup in California; Cemvita Factory, a Houston-based synthetic biology firm focused on the decarbonization of heavy industries; Infinium, an electrofuels company innovator in California forming decarbonization solutions for industries in Japan; and Starfire Energy, a modular green ammonia solution provider in Denver.

Series A and Series B valuations for US companies are much higher now than they were a few years ago, Sakai said. Still, the US is the leading climate tech startup ecosystem in the world and provides rich opportunity for capital deployment, Sakai said. Biofuels, SAF and waste-to-energy are leading sectors for MHI investment moving forward.

“We have several hundred of these in the pipeline that we are looking at right now,” he said. “In the next few years, we will increase the number of these portfolio companies.”

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Advisor Profile: Cameron Lynch of Energy & Industrial Advisory Partners

The veteran engineer and financial advisor sees widespread opportunity for capital deployment into early-stage renewable fuel companies.

Cameron Lynch, co-founder and managing partner at Energy & Industrial Advisory Partners, sees prodigious opportunity to pick up mandates in the hydrogen sector as young companies and early movers attract well-capitalized investors looking for auspicious valuations.

The firm, a three-year-old boutique investment banking outfit with offices in New York and Houston, is broadly committed to the energy transition, but is recruiting for new personnel with hydrogen expertise, Lynch said, adding that he is preparing for a new level of dealmaking in the new year.

“I think we can all expect 2023 will be even more of a record year, just given the appetite for hydrogen,” Lynch said. “Hydrogen is one of our core focuses for next year.”

Cameron Lynch

Lynch started his career as a civil & structural engineer and moved into capital equipment manufacturing and leasing for oil & gas, and also industrial gasses –things like cryoge

nic handling equipment for liquid nitrogen. He started the London office of an Aberdeen, U.K.-based M&A firm, before repeating that effort in New York.

Founding EIAP, Lynch and his business partner Sean Shafer have turned toward the energy transition and away from conventional energy. The firm works on the whole of decarbonization but has found the most success in the hydrogen space.

Earlier lifecycle, better valuations

Hydrogen intersects with oil& gas, nuclear, chemicals, midstream companies, and major manufacturing.

Large private equity funds that want to get into the space are realizing that if they don’t want to pay “ridiculous valuations for hydrogen companies” they must take on earlier-stage risk, Lynch said.

Interest from big private equity is therefore comparatively high for early-stage capital raising in the hydrogen sector, Lynch said, particularly where funds have the option to deploy more capital in the future, Lynch said.

“They’re willing to take that step down to what would normally be below their investment threshold.”

Lynch, who expects to launch several transactions in the coming months with EIAP, has a strong background in oil & gas, and views hydrogen valuations as a compelling opportunity now.

“It’s very refreshing to be working on stuff that’s attracting these superb valuations,” Lynch said.

There’s a lot of non-dilutive money in the market and the Inflation Reduction Act has been a major boon to investors, Lynch said. For small companies, getting a slice of the pie is potentially life changing.

Sean Shafer

The hydrogen space is not immune to the macroeconomic challenges that renewables have faced in recent months and years, Lynch said. But as those same challenges have accelerated the move toward energy security, hydrogen stands to benefit.

Supply chain issues post-COVID pose a potential long-term concern in the industry, and equity and debt providers question the availability of compressors and lead times.

“I would say that’s one of the key issues out there,” Lynch said. There’s also the question of available infrastructure and the extent to which new infrastructure will be built out for hydrogen.

EIAP sees the most convincing uses for hydrogen near term in light-weight mobility and aerospace, Lynch said. The molecule also has a strong use case in back-up generation.

Hydrogen additionally presents companies in traditional fossil fuel verticals the opportunity to modernize, Lynch said, citing a secondary trade EIAP completed earlier this year

California’s Suburban Propane Partners acquired a roughly 25% equity stake in Ashburn, Virginia-based Independence Hydrogen, Inc. The deal involved the creation of a new subsidiary, Suburban Renewable Energy, as part of its long-term strategic goal of building out a renewable energy platform.

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