In 2018, Wesley Cooke, the chief executive of Enegix Energy, set out on a mission to reduce energy poverty.
His plan was to build a model for power projects that combined decarbonisation with boosting access to electricity. Having spent time working in several emerging markets, he notes that one thing that always struck him is “that energy poverty — which is rampant today, affecting around 940 million people — is a huge global problem that doesn’t always get the necessary attention”.
Enegix Energy has announced its first project: it will build the world’s largest green hydrogen plant in Ceará, in northern Brazil, after signing a memorandum of understanding with the state government in February. Its ‘Base One’ facility will produce 600–700 million kg of green hydrogen annually, will run entirely on renewable energy and produce zero emissions.
The project will create thousands of jobs in the plant's construction, and hundreds of full-time jobs to manage the facility thereafter. Enegix expects the facility to be fully operational by 2025. Its goal is to turn Ceará into a hydrogen export location, making hydro-heavy Brazil a pioneer in the hydrogen revolution.
First and largest
Brazil’s potential for renewable energy is well known among investors and Enegix is not the first to be attracted by the country’s solar and wind capabilities. In 2020, the country welcomed 31 greenfield renewable energy projects, its second-highest year after 2019, according to fDi Markets. Enegix, too, was enticed by the north-east coast’s wind and solar potential, and the accessibility to water — integral in the production of hydrogen.
But the scale of Enegix’s project is unprecedented. Initially, such an ambitious project was not necessarily Enegix’s intention; however, Mr Cooke understood that whatever the project, small- or large-scale, it would demand a lot of capital. And so, Enegix made the decision to go big in Brazil.
“It would be hard to find a 20–25% capacity factor for solar, but there we’re looking at projects that will have 33%,” he says. “For onshore wind, some good projects are around 40% capacity factor; in Ceará we’re looking at 50%.”
The possibility of offshore wind in Ceará means that, together, the renewable potential of the project can scale up to 100GW to meet rising global demand. This, Mr Cooke points out, can potentially generate more than double the electricity usage in Australia per annum.
The technology at the heart of Enegix’s plans is liquid organic hydrogen carriers (LOHCs). “The only way we’re going to have a significant impact is if we can make hydrogen handleable in a cost-effective way. And we can't speak enough for liquid organic hydrogen carriers,” he says. “It’s a game changer.”
LOHCs are organic compounds that can absorb hydrogen, keeping it stable at ambient temperature. Importantly, hydrogen is not toxic, flammable or explosive when bound to LOHCs, meaning that this technology would allow for safe and secure hydrogen exports.
But, as Schreiner Parker, vice president of Latin America at Rystad Energy, points out, “it is not sufficient to just build an export facility; there has to be an import facility somewhere”. Simply put, the target market will need the capabilities to re-electrify hydrogen.
“If successful, the project may reorient people’s view of Brazil in terms of renewable energy, but there are a lot of questions that need to be resolved: one of which is the cost,” he says, adding that offshore wind and cooling hydrogen incur huge costs while the regulatory environment in Brazil lacks clarity.
“There’s potential for delay with this project,” Mr Parker says. “We don’t expect construction to start before 2030.”
This article first appeared in the June/July print edition of fDi Intelligence. View a digital edition of the magazine here.