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Hydrogen energy & Southeast Texas: Why here, why now?

By Eliecer "Eli" Viamontes, President & CEO, Entergy Texas

Posted September 2, 2022 in News

Companies across all industries are seeking to reduce emissions and associated costs from operations, and the power industry is no different. When it comes to generating clean energy, utilities have traditionally looked to renewable and nuclear resources; however, hydrogen is a viable option for renewable energy storage and reliable, clean power generation.

Demand for the nonpolluting element has tripled since 1975, and development of low-to-zero carbon hydrogen production continues to grow across the world to support the decarbonization goals of countries and companies. Closer to home, there have been recent developments in funding opportunities to incentivize clean energy production, making alternative fuel sources more competitive against traditional fuel sources.

Southeast Texas is well positioned to play a key role in the growing low-to-zero carbon hydrogen industry, as we are in the heart of hydrogen producers, extensive hydrogen pipeline delivery infrastructure, hydrogen storage capability and industrial customers. In fact, one of the largest green hydrogen plants in North America will soon call the Beaumont area home. Our region is full of companies that are leaders in energy technology integration, deployment, operation and maintenance. As a result, our service area already has a workforce with the skillset to become a leader in clean hydrogen innovation. Now is the time to leverage these strengths to ensure Southeast Texas not only maintains but enhances its position as a worldwide leader in the energy industry.

To help produce sustainable, low-cost and reliable energy to the ever-growing Southeast Texas population, Entergy Texas is working to bring the Orange County Advanced Power Station to Bridge City. OCAPS will have the initial capability to use up to 30% hydrogen by volume along with natural gas to generate power. Hydrogen produces zero carbon emissions when utilized as the fuel source for electric generation. The dual-fuel plant will provide enough electrical energy to power over 230,000 residential homes across Southeast Texas.

As soon as it is placed in service, OCAPS’ dual fuel capability to use hydrogen as an additional fuel source will provide immediate reliability benefits to Texans in the event the delivery of natural gas is constrained, as it was during Winter Storm Uri. In addition, Entergy Texas views hydrogen as a form of long-duration storage for renewable energy. When renewable resources produce energy at the time it’s needed, they can provide power directly. At the same time, when renewable resources are coupled with electrolysis, and hydrogen storage, they can generate clean hydrogen that can be used to fuel dispatchable power plants whenever needed. In other words, hydrogen is a way to convert intermittent renewables into clean, on-demand power that is available when Texans need it most.

The OCAPS facility will not only modernize the generation fleet but help drive economic development and benefit the communities we serve. An outside analysis determined the construction of OCAPS will create nearly $1.8 billion in total economic activity in Southeast Texas, leading to more than 7,000 jobs during construction. OCAPS will be replacing old, less fuel-efficient generation resources and is projected to save customers approximately $109 million in fuel costs during its first full year of operation alone. In addition to providing reliable and affordable power, OCAPS’ hydrogen capabilities will help meet our customers’ evolving sustainable energy needs as the nation moves further toward a low-carbon economy. For example, Entergy Texas recently entered into an agreement with Sempra Infrastructure to develop a renewable electricity plan to provide efficient, resilient, and sustainable power to Sempra’s facilities in Southeast Texas.

Southeast Texas is growing at a rapid pace, and the time to continue to invest in hydrogen and power that growth is now. Texas residents deserve reliable power, and OCAPS generates that power right here in Texas. The OCAPS project reduces reliance on power imported from other states and helps ensure the region has access to modern and efficient generation. Entergy Texas is committed to making investments that support a resilient electric system and provide reliable, affordable, and sustainable power to our customers for generations to come.