Energy groups launch two green hydrogen projects in Italy (updated)

Hera SpA

12/12/2023 17:22

(Changes headline, adds first, third and last paragraphs to
include second hydrogen project)
       MILAN, Dec 12 (Reuters) - 
    Four energy companies announced on Tuesday two separate
green hydrogen projects in Italy as they move to offer clean
fuels to their customers and take advantage of money coming from
the European Union's post-pandemic recovery fund.
  
        Italian gas grid operator Snam  SRG.MI  and utility Hera
 HRA.MI  said they had signed an agreement to develop a green
hydrogen production site near the northern city of Modena.
    Separately the Italian unit of France's Engie  ENGIE.PA  and
gas distributor Società Gasdotti Italia (SGI) together with
local industry lobby Consorzio Industriale Lazio said they would
produce the green fuel near Rome. 
    The 20 million euro ($21.6 million) project led by Snam and
Hera involves setting up a photovoltaic plant that will supply
green energy to an electrolyser to produce hydrogen from water.
At full capacity it will make 400 tonnes a year of green fuel. 
    "Hydrogen is still expensive, but its price could halve to
around 5 euros a kilo if the government offers incentives to
reduce costs, in addition to existing ones on capex," said Hera
Chief Executive Orazio Iacono, adding the price could be
considered competitive by customers.
    The green fuel will go to local public transport groups and
could also be available to energy-intensive companies based near
Modena, including tile-makers and automotive groups.
    In its business plan to 2026, Snam has earmarked 1 billion
euros for investment in decarbonisation, which also includes the
development of a pipeline to bring hydrogen from North Africa to
northern Europe, dubbed SoutH2 Corridor. 
    Snam Decarbonisation Unit Executive Director Piero Ercoli
said the group would launch a market test for cross-border
hydrogen infrastructure next year.
    The project involving Engie and SGI also plans to start
producing in 2026 and reach a capacity of 400 million tonnes of
hydrogen per year, the groups said. It will cost 20 million
euros, of which 9.5 million euros will be coming from public
funds.
($1 = 0.9258 euros)

 (Reporting by Francesca Landini; editing by David Evans/Keith
Weir)
 ((francesca.landini@thomsonreuters.com; +39 02 66129437;
Reuters Messaging: reutersitaly.thomsonreuters@reuters.net))