Rio Grande do Sul government presents study about investment opportunities on green hydrogen

The production of green hydrogen integrates the strategic proposal of the Rio Grande do Sul government for the next years. Recently it was launched the study “Strategies for Green Hydrogen in Rio Grande do Sul” by the State government, about the productive chain of this kind of energy. The detailed plan for the economic development of the sector, showing the potentiality of Rio Grande do Sul, was made by the McKinsey consulting.

The State governor Eduardo Leite highlights that the document sustains the capacity of the State to produce green hydrogen. “Now we have a strong technical study that proves our conditions to develop this chain, making it possible for investors to bet on Rio Grande do Sul as the head office of a plant of green hydrogen generation”, he said. The governor also mentioned the results that might be generated. “the effects of the study will benefit all society. Green hydrogen will improve the local economy and generate new jobs and income” he reinforced.

Green hydrogen and other sources of renewable energy generation were on the agenda during the state delegation mission to The Netherlands in June 2022. Among the topics, there were a meeting with the general director of the Department of External Economic Relationships from The Netherlands government, Peter Portman, organized together with NBSO Porto Alegre.

Representatives from organizations responsible for business and projects related to renewables presented several initiatives being developed in the European country, which is considered a reference in sustainable development.

Scenario

According to the study, on an optimistic scenario, there would be the use of green hydrogen in application of all complexities (low, medium, and high), including the use in refineries, transportation, highway, cycle turbines, fertilizers, methanol, industrial heating, maritime transportation, gas mixture, highway transportations and passenger cars. In this case the application can generate in 2040, an increase of up to 62 billion Brazilian Reais, on the state Gross Domestic Product (GDP) – compared to the index of 2021, which would represent 11% of the total. The scenario also predicts 41 thousand jobs at the period.

If used in activities of low and medium complexity, which include refineries, railway transportation, cycle turbines, fertilizers, methanol, industrial heating, maritime transportation, and gas mixture, the GDP in Rio Grande do Sul could grow in 33 million Brazilian Reais – equivalent to 6% in today’s values and over 25 thousand new jobs. Considering the scenario of applications of low complexity – as it is the case of refineries, railway transportation, and cycle turbines – the expected is 3.7 billion of the GDP in the same period and the generation of 2 thousand jobs.

The secretary of Environment and Infrastructure, Marjorie Kauffmann, reinforced the competitive differences in the State: “Besides having renewable energies: more than 100 gigawatts of wind and solar energy mapped, we also have proper places, like the Port of Rio Grande, which has appropriate infrastructure and logistic, as well as other places with the same conditions. And we also have the political wish to develop the productive chain”, she said. The Secretary of Civil House Artur Lemos Junior, commented the possibility of the State become leader on the production of Green Hydrogen in Brazil. “The studies show that our state indeed has a great potential to develop this chain and be leader in the country, with a difference: we have internal market to start the production and after that we can search for the external market”, he said.

The study also pointed ten places in Rio Grande do Sul with more favorable conditions to develop this activity: Cambará do Sul/Arroio do Sal, Dom Pedrito, Giruá, Mostardas, Porto Alegre, Rio Grande, Santa Vitoria do Palmar, São Francisco de Assis.

Evaluations

In the evaluation of the president of the Sindienergia – RS (Renewable Energies Industries Union of Rio Grande do Sul). Guilherme Sari, the study is an important step made by the State, so that it can disclose the opportunities of the sector to Rio Grande do Sul. “We understand it is fundamental to have a deeper knowledge of the whole process. There are many investors and a market to be developed. It is clear that today the gaucho green hydrogen market has focus on the internal use and on MERCOSUL. We know there is a local market with high demand, with the possibility to use it on agribusiness, a sector Rio Grande do Sul and Central West that are very strong, and can demand this need of hydrogen”, said Sari.

“The South has a great wind potential and other renewable sources of clean energy generation to accomplish”, he adds. Renewable sources in Rio Grande do Sul, are today 82% of electrical supply. The wind energy, for example, represented 2% in 2010 and went up to 19% in 2020. There is also 10 gigawatts (GW) licensed and total capacity of 103 GW onshore and 109 GW offshore.

According to the cofounder of Trust & Co consulting, Juliano Pereira, the fact that the State has taken the lead to invest on the study is of great importance in order to reduce the uncertainties and the risks of a new market. It is a very valid and necessary initiative. He also evaluates that the concept of self-sufficiency in terms of sufficient demand in the state to attend the local production, is a promising concept. “Which can allow us to have a factor of difference and to make this industry work”, he adds.

On the link www.sema.rs.gov.br/h2v it is possible to download the booklet about  Strategies for green hydrogen in RS.

Opportunities in Brazil

On the 4th of April 2023, Rotterdam Partners together with the Port of Rotterdam, the Economic Diplomatic Network, Wind & Water Works, and the Netherlands Enterprise Agency (RVO) are organising an online seminar for companies that are interested in port development, port logistics and port related energy projects – offshore wind and hydrogen – in Brazil.

This seminar is the first activity that is on behalf of the ‘Green Ports Partnership’ program. Normally this entails exclusive activities for the companies that are registered for this program. However, this online seminar will be an open invitation for everyone that is interested in doing business in ports in Brazil, including the Port of Rio Grande, in Rio Grande do Sul.

More information: https://en.rotterdampartners.nl/international-trade/online-seminar-green-ports-partnership/