Two US energy giants plan to spend $4bn to develop a massive green hydrogen scheme in Texas, using 1.4GW of renewable energy — a project they describe as the largest in the US.

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Industrial gas behemoth Air Products and utility AES want to build an electrolyser capable of delivering 73,000 tonnes of green hydrogen per year. Analysis from Hydrogen Insight estimates the electrolyser could have capacity of up to 800MW.

The pair intend to develop the project, including dedicated renewables capacity, as a 50:50 joint venture, with commercial operation mooted for 2027.

Green H2 produced at the plant will be destined for the mobility market, as well as industrial markets, Air Products and AES said.

Air Products will be the sole offtaker from the project, under a 30 year contract, a “build-own-operate and offtake” model it has already adopted for the Neom Green Hydrogen project.

One of the company’s joint venture partners in the Neom project, ACWA Power, recently identified Air Product’s decision to purchase all of the scheme’s H2 product as a major driver behind its ability to move forward without subsidies.

However, the Air Product-AES Texas project will almost certainly be looking to benefit from the $3/kg maximum Production Tax Credit (PTC) introduced by the Biden administration under the Inflation Reduction Act.

“The new facility in Texas will be, by far, the largest mega-scale clean hydrogen production facility in the US to use wind and sun as energy sources,” said Seifi Ghasemi, Air Products' chief executive officer.

However the partners have not given a timeframe for reaching final investment decision (FID), meaning it joins a host of other schemes in Texas that lay claim to being the US’s biggest green H2 project, including Green Hydrogen International’s enormous 60GW Hydrogen City scheme in Duval County, which plans to deliver 2.5 million tonnes of green hydrogen a year.

And New York-based Plug Power is teaming up with LNG player New Fortress Energy with a proposal to build a 120MW green hydrogen facility in Beaumont to supply H2 to industrial customers.