Advanced Clean Energy Storage Project Invited to Submit Part II Application for up to $595 Million Financing from U.S. Department of Energy for Proposed Hydrogen Hub and Long-duration Renewable Energy Storage Project
Project Applied under Title 17 Innovative Energy Loan Guarantee Program
SALT LAKE CITY (May 11, 2021) – Mitsubishi Power Americas and Magnum Development today announced that their jointly developed Advanced Clean Energy Storage Project has been invited by the U.S. Department of Energy’s (DOE) Loan Programs Office to submit a Part II Application for up to $595 million under the Title 17 Innovative Energy Loan Guarantee Program to develop a proposed green hydrogen hub in Delta, Utah. The green hydrogen hub is part of a broad effort to support decarbonization efforts across the western U.S. The DOE program finances projects that accelerate commercial deployment of innovative energy technology that avoids, reduces, or sequesters greenhouse gas or air pollutant emissions.
The green hydrogen hub at the Advanced Clean Energy Storage Project would interconnect green hydrogen production, storage and distribution in the West. Green hydrogen — which is hydrogen produced from renewable energy sources — will support decarbonizing multiple industries including power, transportation, and manufacturing.
Haddington Ventures, the financial advisor for the project and equity sponsor of Magnum Development, will submit the Part II Application this summer. If successful, the project will enter due diligence for the potential loan guarantee. Additionally, Haddington Ventures is responsible for interfacing with the DOE as well as managing the Equity Syndication Program (ESP) to provide construction capital on behalf of the Advanced Clean Energy Storage Project.
If the project reaches loan closing, debt financing from the DOE would support construction of the green hydrogen hub, which ultimately targets building more than 1,000 megawatts (MW) of electrolysis facilities capable of producing more than 450 metric tonnes per day of green hydrogen. The hydrogen would be stored in the Advanced Clean Energy Storage Project’s salt caverns, which are natural geological formations providing safe, reliable, and cost-effective bulk storage of hydrogen. The massive salt formation is adjacent to the Intermountain Power Project near Delta, Utah, with transmission interconnections to major demand centers and significant renewable energy resource opportunities in the region.
The project’s salt caverns will be capable of holding more than 5,500 metric tonnes of hydrogen. From an energy storage perspective, one cavern holds the equivalent of 150 gigawatt hours (GWh) of carbon-free dispatchable energy and/or decarbonized fuel that can be used in other industries. By comparison, a U.S. Energy Information Administration (EIA) 2020 report estimates the current installed base of battery energy storage across the U.S. at 1.2 GWh. Therefore, using salt caverns for energy storage is a significant opportunity to expand energy storage resources throughout the U.S. and further supports the increased build-out of renewable energy.
Craig Broussard, President and CEO of Magnum Development, said, “We look forward to working with the Department of Energy to explore financing opportunities for innovative renewable energy projects like ours that not only will help decarbonize the West, but also will support hundreds of clean energy jobs in Millard County and across the state of Utah.”
Paul Browning, President and CEO of Mitsubishi Power Americas, said, “Together with our partner Magnum, we have been planning and developing the world’s largest renewable energy storage project for several years. We would welcome the Department of Energy’s support to help us realize utility-scale green hydrogen production, storage, and distribution to decarbonize power and other industries throughout the western U.S. Our green hydrogen hub will help bring a Change in Power.”
Mitsubishi Power Americas and Magnum Development’s jointly developed Advanced Clean Energy Storage Project creates a green hydrogen hub as part of a broad effort to support decarbonization efforts for multiple industries including power, manufacturing, and transportation across the western U.S. (Credit: Mitsubishi Power)
About Mitsubishi Power Americas, Inc.
Mitsubishi Power Americas, Inc. headquartered in Lake Mary, Florida, employs more than 2,000 power generation, energy storage, and digital solutions experts and professionals. Our employees are focused on empowering customers to affordably and reliably combat climate change while also advancing human prosperity throughout North and South America. Mitsubishi Power’s power generation solutions include natural gas, steam, aero-derivative, geothermal, distributed renewable technologies, environmental controls, and services. Energy storage solutions include green hydrogen and battery energy storage systems. Mitsubishi Power also offers digital solutions that enable autonomous operations and maintenance of power assets. Mitsubishi Power, Ltd. is a wholly owned subsidiary of Mitsubishi Heavy Industries, Ltd. (MHI). Headquartered in Tokyo, Japan, MHI is one of the world’s leading heavy machinery manufacturers with engineering and manufacturing businesses spanning energy, infrastructure, transport, aerospace and defense. For more information, visit the Mitsubishi Power Americas website and follow us on LinkedIn.
About Magnum Development
Magnum Development, LLC owns and controls the only known “Gulf Coast” style domal-quality salt formation in the western United States. Magnum was originally funded by Haddington Energy Partners III, LP in 2008 to support a variety of projects centered around a large salt body near Delta, Utah. Site viability and profitability has been proven with one business, Magnum NGLs, LLC, which was successfully developed, brought to commercialization, and sold in 2015. In March 2018, Magnum Development entered into a joint venture with Sawtooth by contributing its refined products business for an 8% ownership interest in the Sawtooth JV. Magnum Development is focused on developing multiple portfolio companies, which are in various stages of development: natural gas, Compressed Air Energy Storage (CAES), refined products, and industrial gases such as hydrogen and helium.
About Haddington Ventures
Founded in 1998, Haddington Ventures, LLC oversees a growing portfolio of successful conventional and renewable energy businesses that are bringing innovative new infrastructure to the U.S. energy sector. Haddington Ventures, through its private equity funds, generally makes control-oriented investments in portfolio companies acquiring or developing energy infrastructure underwritten by long term contracts. Haddington Ventures is led by a team of senior energy professionals who have invested more than $1.5 billion in companies focused on energy infrastructure across multiple private equity funds and co-investment partnerships.