$ 1.3 billion hydrogen complex to create 2,500 construction jobs

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Edmonton will be a hub for western Canada’s hydrogen economy with a new complex expected to be operational by 2024.

An investment of $ 1.3 billion was announced Wednesday for the first phase of a blue hydrogen project of Air Products, a multinational based in the United States.

It aims to capture 95% of its carbon emissions, by reducing carbon intensity to a level which the company says is “close to zero”, by producing blue hydrogen for the electricity grid and for transport by truck by 2024.

Alberta is contributing $ 15 million to the complex, which is expected to create 2,500 construction and engineering jobs and eventually provide enough liquid hydrogen to power every transit agency in the province.

Premier Jason Kenney said he was well suited to take advantage of Alberta’s massive supply of natural gas.

“This is just the start – with projects like these, our province is securing our future as a clean energy powerhouse,” said Kenney.

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The announcement follows provincial and federal hydrogen plans to expand the production of blue hydrogen, which uses natural gas, carbon capture and storage technology. Environmental groups and some critics have called on governments to focus their efforts on green hydrogen, which is produced from renewable sources and has no emissions.

The Canadian government and Invest Alberta signed a memorandum of understanding with Air Products, but the Minister of Innovation, Science and Industry, François-Philippe Champagne, did not provide specific details on the tax incentives or the possible investments to which the federal government would commit.

Champagne said investors and consumers want to see more sustainable products and projects like these will create good jobs as the market shifts to take advantage of hydrogen.

“The global race is on and Canada is ready to lead the way in building a cleaner, stronger and more resilient economy with our private sector partners,” said Mr. Champagne.

Air Products CEO Seifi Ghasemi did not provide specific details on the additional phases.

“I hope this will be the start of many, many other projects that we will do in Canada,” he said.

Edmonton Mayor Don Iveson called it a “transformative” investment, adding that the clean hydrogen energy boom has the potential to revitalize the energy sector and the local economy.

“We need lots and lots of pathways to achieve net zero (emissions) by 2050, but hydrogen is a big deal, and it’s no secret that Alberta has had tough economic times given of all the pressures and disruptions facing our energy sector, ”said Iveson, who noted the city was purchasing two hydrogen-powered transit buses.

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Alberta’s cash contribution to the project will come from the Technology, Innovation and Emissions Reduction (TIER) program, funded by a carbon tax imposed on industrial emitters.

The government could also contribute up to 12 percent of capital costs through the Alberta Petrochemical Incentive Program (APIP), once the facility is operational.

NDP Leader Rachel Notley congratulated the federal and provincial governments for their participation in the project at an independent press conference on Wednesday.

Simon Dyer, deputy executive director of the Pembina Institute, said the complex represents a major improvement over existing hydrogen production using natural gas in terms of emissions, but that it is expected to fill the gap with hydrogen produced with renewable electricity.

“We are impressed with the innovative approach taken by Air Products and encourage them to consider ways to reduce emissions upstream of their natural gas supply,” he said in a statement.

Calling the announcement exciting, Edmonton Global – the regional economic development company – said the Edmonton area is on the cusp of becoming the world’s largest net zero hydrogen network and that the investment from Air Products will radically transform the economy of Alberta and significantly decarbonize western Canada.

“This Air Products investment demonstrates the potential hydrogen has to transform our regional economy,” said Malcolm Bruce, CEO of Edmonton Global. “We are delighted to see Air Products build on the investments they have already made in our region. This expansion, which will be the largest net zero hydrogen complex in the world, is a clear signal to the investment community that Air Products is certain of the enormous opportunity that exists to leverage the expertise, resources and infrastructure that already exists here. Our region is at the center of the hydrogen economy in Canada and around the world and we are aggressively seeking more.

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The news was also greeted with great enthusiasm by the Industrial Heartland Association (AIHA) of Alberta. He said this represents the best of the region’s energy future.

“With innovation, renewed confidence and leadership from all levels of government, projects like (Air Products) will transform the hydrogen landscape in Alberta,” the AIHA tweeted. “We have it all: supporting infrastructure, world-class talent and world-class resource development. Let’s go! “

Julia Levin of Environmental Defense said in a statement that the proposed complex was an example of “greenwashing” because it allocated public funds to the fossil fuel sector rather than prioritizing renewables.

The Canadian subsidiary of Air Products already operates three hydrogen production facilities in Alberta and one in Ontario.

– With files from Lindsay Morey

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