The French company Lhyfe has canceled the green hydrogen plant planned for Vallmoll, in Alt Camp, a project announced in 2023 that foresaw an investment of 28 million euros and was expected to enter production in 2026.
The company has confirmed that it also waives the 14 million euro subsidy granted within the H2 Pioneers program. That aid came from the Institute for Energy Diversification and Saving, an agency dependent on the Ministry for Ecological Transition.
"It has decided to cancel its project and renounce the subsidy" - Lhyfe
The company alleges lack of commercial viability
Lhyfe attributes the decision to the lack of commercial viability of the installation projected in Vallmoll. The firm maintains that the necessary conditions to carry out the plant were not met in time and specifies that among those factors was the minimum number of buyers necessary to guarantee financial viability.
"For Vallmoll, the conditions were not met on time, including the minimum number of buyers that guaranteed the financial viability of the project" - Lhyfe
The planned facility was to have a capacity of 15 MW and supply up to five tons daily of hydrogen to industrial and logistics customers in the area. During the construction phase, 300 direct and indirect jobs were foreseen.
The City Council learned of the resignation a month ago
Lhyfe communicated the withdrawal to the Vallmoll City Council approximately a month ago. The mayor, Josep Lluís Cusidó, has explained that the company conveyed that the project would not go ahead for strictly commercial reasons.
"They told us the project would not go ahead, due to a commercial cost issue. It is a very clean energy but still expensive, and when it comes to selling it to clients there are problems" - Josep Lluís Cusidó, mayor of Vallmoll
The mayor has also lamented the loss of an initiative that placed the municipality within the hydrogen map, although he keeps the door open to future projects linked to this technology.
"We had all the enthusiasm in the world, because Vallmoll was included on the hydrogen map. We remain open and receptive to opportunities of this type" - Josep Lluís Cusidó, mayor of Vallmoll
A brake in a context of cooling of the sector
The company frames the cancellation within a broader market situation. It speaks of a structuring of the sector and a consolidation of projects, while admitting that the market is growing, but less than expected. It also points to a European political and regulatory context that, in its opinion, is slowing down the development of this market compared to other geographical areas where ambitions and the regulatory framework are advancing more quickly.
Lhyfe assures that it is applying an investment prioritization and also points to the slowness with which the European Union's regulatory framework is transferred to the Member States. In that scenario, the European Red III directive, which sets emission targets, is still in the process of transposition into Spanish legislation.
The cancellation of Vallmoll also occurs at a time of paralysis of several initiatives linked to green hydrogen in Tarragona. The Hydrogen Valley, which came to gather more than 260 public and private organizations, is currently on standby. Among its promoting entities are the Rovira i Virgili University, the Port of Tarragona and the Provincial Council.
The debate about technological maturity and the final price
From the research field, Emilio Palomares, director of the Catalan Institute of Chemical Research, considers that the sector has experienced an excessive expectation in recent years.
"There has been a hydrogen bubble. It seemed to arrive quickly but the final prices were not competitive" - Emilio Palomares, director of ICIQ
Palomares maintains that hydrogen will have weight in the future, but warns that its deployment requires more mature technology and costs that allow it to compete in the market.
"Hydrogen will end up being important but requires the technology to be mature. Sometimes we want to implement a technology but with a price that ultimately results in the process being slower" - Emilio Palomares, director of ICIQ
The fall of the Vallmoll project leaves unexecuted one of the plants called to reinforce the deployment of green hydrogen in the Camp de Tarragona and confirms the slowdown of a market that, for now, is advancing below the expectations with which it was presented just two years ago.