The Advanced Clean Energy Storage Project, a much-watched project under development in Delta, Utah, that is shaping up to be the largest renewable hydrogen energy hub in the U.S., has garnered a conditional commitment for a $504.4 million loan guarantee from the Department of Energy’s (DOE’s) federal loan guarantee program.
The conditional loan guarantee commitment issued on April 26 is for the Advanced Clean Energy Storage I, the first phase of a massive undertaking by ACES Delta, which is a joint venture comprising Magnum Development (Magnum), Mitsubishi Power, and Haddington Ventures, to create a new pathway for decarbonization of the Western U.S. grid.
The project envisions producing up to 100 metric tonnes per day of hydrogen from water and renewable energy sources using a 220-MW alkaline electrolyzer bank manufactured by Norwegian firm HydrogenPro—one of the largest deployments of its type to date. That hydrogen will be stored in two gigantic solution-mined caverns sited in the only salt dome in the Western U.S.
Capable of storing a combined 300 GWh of energy, the storage facility will provide long-term seasonal energy storage to Intermountain Power Plant’s (IPA’s) Intermountain Power Plant (IPP) near Delta, Utah, a coal-fired plant that is slated to be repowered with two Mitsubishi Power advanced M501JAC power trains as an 840-MW combined cycle power plant by 2025.
A Power-to-Power Project
The 1986–opened IPP’s two coal-fired units, a combined 1,800 MW, currently average about 13 TWh each year, power that is delivered over 2.4-GW AC and DC lines to IPA’s 35 municipal utility participants, which are primarily in Utah and Southern California. Catering to state clean energy targets—including California’s 100% clean electricity target by 2045—IPA in 2019 signed a pioneering contract with Lake Mary, Florida–based Mitsubishi Power Americas that commercially guarantees the M501JAC units will be able to combust a mix of 30% hydrogen and 70% natural gas when they come online in 2025. Mitsubishi Power told POWER that progress continues to develop a second-generation combustion system that will enable the JAC units to achieve 100% hydrogen fueling by 2045.
The DOE’s Loan Programs Office (LPO) lauded the project’s selection for its potential to “safely and cost-effectively produce and store hydrogen.” LPO Director Jigar Shah on April 26 noted the selection, which is just one of nearly 80 active applications across a variety of technology sectors submitted to the DOE office since March 2021, supports the Biden administration’s efforts to tamp down renewable hydrogen costs by about $5/kilogram as well as “expand the use of clean hydrogen in the industrial sector and beyond.”
The ACES Delta project becomes the DOE’s third offered conditional loan guarantee under the Biden administration. LPO in December offered a $1 billion conditional loan guarantee to Monolith, a 2012-established firm that has developed a methane pyrolysis process to convert natural gas into hydrogen and high-purity carbon black using renewable energy. On April 18, it offered to conditionally lend up to $107 million to Syrah Technologies to expand its capacity to produce critical materials for lithium-ion batteries at the Syrah Vidalia Facility in Louisiana.
Shah on Tuesday highlighted the ACES Delta project’s potential to reduce curtailment of renewable energy in the Western U.S., as well as reduce criteria air pollutant emissions, such as ozone precursors and particulate matter, as well as greenhouse gases (GHGs). That’s consistent with the primary goal of the Title XVII Program, which was established in the 2005 Energy Policy Act, the DOE noted.
“Financially supporting the Project would help bring hydrogen to market and into greater use, thereby reducing overall national emissions of air pollutants and human-caused GHGs,” it added. However, while the conditional…