Mitsubishi Power Americas and Magnum Development have closed on a $504.4m loan guarantee from U.S. Department of Energy’s (DOE) Loan Programs Office to Advanced Clean Energy Storage I, LLC to develop the world’s largest industrial green hydrogen facility in central Utah.
DOE’s loan is its first in more than ten years for a renewable energy project, according to a news release.
In April 2022, DOE’s Loan Programs Office issued a conditional commitment for ACES I. The loan closed on June 3, 2022, highlighting the Administration and the Energy Department’s commitment towards supporting the clean hydrogen sector. This loan helps generate a viable market for hydrogen and will make it scalable in the western United States and electrical grid, creating the fundamental infrastructure necessary to deploy this zero-carbon energy source, the release states.
The Advanced Clean Energy Storage hub will help the clean energy transition by supporting the Intermountain Power Agency’s IPP Renewed Project — upgrading to an 840 MW hydrogen-capable gas turbine combined cycle power plant. 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.
The hub will produce up to 100 metric tonnes per day of green hydrogen from renewable energy using electrolysis. Green hydrogen can then be stored in two massive salt caverns, each capable of storing 150 gigawatt hours (GWh) of energy, resulting in the world’s single largest hydrogen storage site and providing capabilities for seasonal shifting of excess renewable energy. The long-duration energy storage capability of the salt caverns will help improve resource adequacy and decrease costs by capturing excess renewable power when it is abundant and dispatching it back on the grid when it is needed.
“This joint venture is historic for Mitsubishi Power Americas and the future of global hydrogen deployment,” says Bill Newsom, President and CEO of Mitsubishi Power Americas. “We’re proud to partner with Magnum Development and provide the hydrogen equipment to further advance carbon-free hydrogen as a cornerstone of our future energy supply and help chart the path towards net zero.”
The development and operation of the Advanced Clean Energy Storage hub will help spur economic development locally by creating up to 400 local construction jobs throughout the 3-year construction cycle, and it will employ a projected 25 full-time operations and maintenance personnel to provide 24/7 operations and maintenance of the facility.
“Magnum Development has enjoyed a synergistic relationship with the City of Delta and Millard County since 2008,” said Craig Broussard, CEO of Magnum Development and ACES Delta. “In addition, royalties paid from our operations go to our mineral estate partner, the Utah School and Institutional Trust Lands Administration, to provide funding for the Utah educational system. Over the next three decades significant taxes and royalties will flow from this initial phase of green hydrogen development at our site.”
