Spanish Company Bets on Green Hydrogen in Mexico

SENER Ingeniería México aims to replicate its green hydrogen model implemented in Spain in Mexico. The company’s objective is to become leaders in the production of green hydrogen in the country.

The Spanish company SENER, not to be confused with Mexico’s energy ministry holding the same name, is rethinking its business model in Mexico and focuses its efforts on the development of green hydrogen via a pioneering business model in Latin America. Through the construction of small green hydrogen plants, SENER Ingeniería seeks to scale this scheme toward commercial viability and consolidate its leading position in the green energy sector in the coming years.

Despite being established in the Mexican oil and gas sector for more than a decade, the company is aware of wider decarbonization trends in the sector, which were accelerated by the COVID-19 pandemic.

"In Spain, SENER Ingeniería has been developing its green hydrogen technology for a couple of years through a joint venture to set up an electrolysis factory. We are currently installing our company's first pilot plant in Bilbao," said Javier Pascuale, Commercial Director, SENER Ingeniería Mexico.

To replicate this model, Pascuale said that SENER Ingeniería is negotiating options in Mexico. The company hopes that by 2023, the first green hydrogen plant can be set up via small-scale projects of 2.5MW each.

"Beyond the oil and gas that will still last many decades, green energy and decarbonization will be gaining ground. That is why we want to be the first to consolidate ourselves as leaders in Mexico. There is even the potential to export green hydrogen to the rest of Latin America from Mexico," explained Pascuale.

Nevertheless, the Spanish company will maintain its other consolidated business lines, too, including a portfolio of projects with CFE, PEMEX and private partners toward the development of cogeneration plants, combined cycle projects, gas pipelines and refineries, among other infrastructure projects for the oil and gas sector.

Interest in green hydrogen is growing as the energy transition and a reliance on natural gas drive its demand. Although natural gas clean compared to other fossil fuels, it remains a somewhat polluting energy source. Supplementing it with green hydrogen, a prospect already made a reality at various power producing facilities, therefore contributes to the decarbonization of natural gas until the renewable resource can take over entirely.

Industry insiders feel that Mexico has been somewhat slow to develop its green hydrogen industry. However, several international studies by the World Energy Council (WEC) and the International Renewable Energy Agency (IRENA) show a great potential to produce, use and export green hydrogen in Mexico.

"Mexico can be a power among the 10 most important countries in green hydrogen production. They place us around the 5th and 6th place, but we have to produce to be in those places," said Israel Hurtado, President, the Mexican Hydrogen Association (AMH2).

According to a recent study conducted by AMH2 and PricewaterhouseCoopers, Mexico would need to invest around US$60 billion between 2025 and 2050 to consolidate this up-and-coming industry, which has the potential to generate more than 3 million jobs. As an exporter of industrial products, Mexico will require a greater green energy component in its processes if it wants to remain competitive in the international market.