Advanced storage project receives $500 m commitment from US DoE

10 May 2022

The US Department of Energy’s (DOE) Loan Programs Office has issued a conditional commitment to Advanced Clean Energy Storage, Mitsubishi Power Americas, Magnum Development and Haddington Ventures for up to $504.4 million in debt financing for the Advanced Clean Energy Storage Project, which is expected to be the world’s largest industrial green hydrogen production and storage facility.

The hydrogen storage hub, located in Delta, Utah, was first announced in May 2019, and within three years is in the final stages of debt and equity closing. Currently, the hub has secured all major contracts including offtake, engineer, procure and construct (EPC) contractors, major equipment suppliers, and operations and maintenance (O&M) providers.

Haddington Ventures, the financial advisor for the hub and equity sponsor of Magnum Development, is also securing $650m through its Equity Syndication Program.

The hub will initially be designed to convert renewable energy through 220 MW of electrolysers to produce up to 100 metric tonnes per day of green hydrogen, which will then be stored in two huge salt caverns each capable of storing 150 GWh of energy. Financed with support from the DOE loan guarantee, this facility will supply hydrogen feedstock to the Intermountain Power Agency’s IPP Renewed Project – an 840 MW hydrogen capable gas turbine combined cycle power plant – that will initially run on a blend of 30 % green hydrogen and 70 % natural gas by volume starting in 2025 and is intended to increase to 100 % by 2045.

Several leading industry entities are also involved in the hub, which broke ground this Spring, including, Black & Veatch, Mitsubishi Power, and NAES Corporation. WSP will provide EPC Management services for the development of two large salt cavern storage facilities. WSP has been developing underground storage facilities since the 80s and has developed over 200 salt caverns for top tier midstream companies. 

Utah School and Institutional Trust Lands Administration, a subdivision of the State of Utah, leases the site and will utilise revenue generated from the hydrogen hub to benefit Utah schools.

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