Spanish power company Iberdrola is expanding its bet on green hydrogen with a plan to build a 750 million euro ($808.05 million) plant to produce green ammonia that would be purchased and exported by ammonia trader and shipper Trammo.

Iberdrola has positioned itself as one Europe’s leaders in renewable power and green hydrogen, in line with Spain’s ambition to become a green energy powerhouse.

Green ammonia is produced using renewable energy and can be used in its gas form or turned into green hydrogen. It can also be used in fertiliser production, to transport green hydrogen and has potential uses as a marine fuel.

Millán García-Tola, the company’s green hydrogen chief, said this deal could be the first of several.

“Reducing industrial emissions with the supply of green ammonia presents opportunities in the coming years and Iberdrola wants to be at the centre of this market,” he said on Friday.

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“We are already in talks with Trammo to look at similar projects in other markets.”

Green hydrogen projects in general are often not competitive without subsidies.

Iberdrola said that the new plant “will be viable thanks to European funding” that it will apply for. The construction of a 500 megawatt renewable energy facility will fuel the plant.

Iberdrola said this would be the first green ammonia plant in southern Europe, but did not say where it would be located.

The deal with Trammo envisages up to 100,000 tons of green ammonia being shipped out of southern Europe to the north of the region every year, starting in 2026.

Building the facility will create up to 3,500 jobs, the company said, while more than 50 jobs will be created in operations and maintenance.

Source: Reuters