International Government Hydrogen Updates: Central and South America

By Nova Thayer

As the hydrogen economy continues to expand, countries around the world have begun to invest in domestic hydrogen industries and zones to meet urgent decarbonization goals. Following up on FCHEA’s previous international update, this blogpost will cover the significant development of hydrogen projects in Central and South America.

Brazil

Brazil recently released a new hydrogen roadmap, detailing the technical and economic challenges the country faces involving hydrogen production. The report calls for a “rainbow” approach to hydrogen, supporting a range of different hydrogen pathway projects, including reformed gas and renewables.

In Brazil, the northern State of Ceará launched the “Green Hydrogen HUB” project, which seeks to jumpstart the region’s hydrogen industry by creating a public and private partnership to attract investors and companies. To date at least 12 Memorandum of Understandings (MoU) have been signed with different companies. In addition to a favorable business climate, the region also has access to ample wind and solar potential, estimated to be around 900GW, including onshore, offshore, and hybrid opportunities.

The Port of Pecém, which could be a hub for both hydrogen production and export (Complexo do Pecém)

Ceará is not the only state in Brazil pursuing hydrogen projects, and several ports across the country have begun to invest in hydrogen production and distribution projects of their own. This includes the Acu Port, Rio de Janeiro, the Rio Grande do Norte, and the Port of Suape, Pernambuco. As projects get off the ground, and the cost of hydrogen production continues to drop, Brazil has the potential to develop into an important hydrogen hub for the region.

Columbia

Columbia’s government has been active in pursuing a hydrogen economy as well. A hydrogen roadmap was released in late 2021, covering the challenges and opportunities for hydrogen in the country. This led to other reports providing overviews of the country’s hydrogen industry, including current projects and initiatives.

The country is utilizing a multi-step approach, utilizing its extensive gas reserves to produce blue hydrogen while also nurturing the renewable industry to support green hydrogen production. The country predicts that green hydrogen will begin reaching cost parity with blue hydrogen by 2027, and significantly outpace blue hydrogen in 2036 onward.

An example of this roadmap in action can be seen in the Columbian province of Cartagena, where Columbia’s state-run oil and gas companies have started operations on two hydrogen projects. One is a 53.2 kW electrolyzer that produces green hydrogen, and the other is a project that will blend hydrogen with gas in the existing transport network. The government hopes to develop between 2 GW and 3 GW of electrolysis capacity of clean hydrogen production by 2030.

Chile

Chile’s government has been a long supporter of decarbonization and hydrogen production specifically. The country recently made it’s 2050 carbon neutrality plan legally binding, in addition to releasing detailed plans on hydrogen production plants and projects. For example, the Chilean government released $50 million in grants for six clean hydrogen projects and aims to reduce the price of hydrogen below $1.50 per kilogram by 2050. This approach of financing important pilot projects and setting clear, legally binding targets helps create the investor confidence necessary for the clean hydrogen transition.

Costa Rica

The government of Costa Rica has focused a significant amount of time and resources on decarbonization efforts in recent years. And like any realistic decarbonization plan, the country’s 2020 National Decarbonization Plan highlights hydrogen as a potential source of clean energy for industry and transportation. The country is currently working on creating a National Hydrogen Strategy report which will provide a more comprehensive overview of the country’s hydrogen potential.

However, Costa Rica isn’t just working on reports, there are several promising projects and collaborations already underway. For example, the Australian infrastructure company Kadelco signed a MoU with the Costa Rican Institute of Electricity to identify conditions for the production of green hydrogen. If the conditions are ideal, the company plans to build a green hydrogen production plant in the country. The value of this agreement is estimated at $2 billion, and other foreign companies have expressed interest in building green hydrogen production plants also.

Panama

Panama recently announced the start of its National Hydrogen Strategy, which seeks to develop the country into a regional green hydrogen hub, capable of exporting to both Atlantic and Pacific based countries and companies. The plan is expected to be completed by mid-2022, and smaller projects have already sprung up, such as the government’s plan to installed a green hydrogen electrolyzer and hydrogen bus network for Panama City.

We look forward to what will come next, and where, as awareness about hydrogen continues to grow around the world. As more and more countries begin to invest resources in hydrogen, the global hydrogen industry is expected to expand rapidly, and the Americas seem well placed to take advantage of the coming demand for, and benefits of, clean hydrogen, based on the number of announcements, plans, and projects coming out of the region.