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Renewable Energies & Hydrogen Strategic Markets

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Canada

Energy Sector:Wind, Hydrogen

Category:Strategic Markets

Region/Province:Newfoundland and Labrador, Nova Scotia, Québec

Canada is already a world leader in renewable energy generation. Moving water is by far the most important renewable energy source in Canada, accounting for 61.7% of national power generation in 2022. Canda is also the third-largest producer of hydropower in the world. In addition, wind and solar have seen significant growth over the past decades. At the end of 2023, a total of 21.9GW of wind, solar and energy storage capacity has been installed. According to Canada Energy Regulator, wind and solar are expected to contribute to 12% of Canadian energy mix by 2035.

Source: Canadian Renewable Energy Association

Abundant natural resources and a reliable legal framework set the ground for continuous, strong growth of renewable energy and provide a high degree of energy security.  At the same time, huge challenges lie ahead as the Canadian government is committed to achieving net-zero greenhouse gas emissions by 2050. In line with the goal, power generation and grid capacity need to increase by up to 3.4 times to ensure a sustainable, secured and low-cost demand. A study by the Canadian Renewable Energy Association shows that this would require an installation of 4-5GW per year.

Wind Energy

Nearly 17GW of onshore wind has been installed throughout the country, with most of the capacity in the regions Ontario, Alberta, Québec. The Buffalo Plains wind farm will become the largest onshore project in Canada, once the operation begins in December 2024. The project consists of 83 wind turbines from Siemens Gamesa and has a capacity of 495MW, enough to power 240,000 households in Alberta. Buffalo Plains wind farm was formerly developed by ABO Wind and sold to Copenhagen Infrastructure Partners (CIP). Amazon has reached an PPA with CIP in November 2023 to purchase 415MW from the project.

While onshore wind is now one of the fastest-growing renewable sectors in Canada, no offshore wind project has been built yet. The east coast of Canada boasts some exceptional advantages developing offshore wind: mean wind speed, huge shallow water areas and solid industry base with well-established port infrastructure. Regions of Newfoundland and Labrador, Nova Scotia have recognized offshore wind as a unique opportunity to support the global energy transition and create economic and environmental benefits in the country.  

The Province of Nova Scotia intends to offer leases for 5GW of offshore wind by 2030 in connection with green hydrogen production. The first call for bids is expected to be issued by 2025. DP Energy and SBM Offshore are working to build the “Nova East Wind Project” with a proposed capacity of 300-400MW. After completion by 2030, it will become Canada’s first floating offshore wind farm.

A white paper jointly published by Canadian consulting firm Waterford Energy Services and Hamburg-based companies greenjoule and JBO (EEHH member) in 2024 analyzes and explores the feasibility of developing a 700MW offshore wind project in Nova Scotia.

Hydrogen

In 2020, Canada published the Hydrogen Strategy and sees hydrogen as a way to boost economic growth, decarbonize the industry and create energy resilience. Based on the unique advantages, like rich feedstocks, skilled workforce and excellent international collaboration, Canada has all the key elements needed to build a competitive and sustainable hydrogen economy and aims to become a leading nation in the production of clean hydrogen, covering domestic demand of up to 20.5 M t and exporting a large amount to the world.

Hydrogen
Source: Government of Canada

The energy policy in Canada will be mainly made and shaped at the provincial level. Due to their different conditions and interests, the approach to promoting the hydrogen economy varies among regions. Oil and gas-rich western provinces) such as Alberta and British Columbia, attach importance to generating blue hydrogen, whereas Québec, on the other hand, wants to take advantage of high renewable energy capacity, low electricity price and huge freshwater reserves to produce green hydrogen.

As outlined in the Canadian hydrogen strategy, the hydrogen industry will be mainly developed through regional hubs and demonstration projects over the next few years. This offers opportunities for Canada and Germany to cooperate on scaling up hydrogen production and to export green hydrogen to Germany. A cooperation between Germany and Newfoundland and Labrador to use the vast untapped wind resources on the eastern coast is regarded as particularly promising. Thanks to the low energy requirements of the local population and industry, the majority of its wind energy can be used to produce green hydrogen and ammonia. In summer 2023, the Province of Newfoundland and Labrador named four successful bidders to participate in the development of wind-to-hydrogen projects on state-owned land (crown land).

Under the name, ‘Toqlukuti’k Wind and Hydrogen’, the German wind developer, ABO Wind, plans to build a 5-gigawatt onshore wind farm on an area of approx. 108,000 hectares and produce green ammonia and hydrogen close to the Come-By-Chance refinery, together with Braya Renewables Fuels. The project is divided into several phases. A 30-megawatt electrolyzer is scheduled to be commissioned by 2025. This would produce enough green hydrogen to cover 13% of the refinery’s hydrogen requirements. From 2026 to 2034, the plan is to gradually increase the output of the wind power and electrolysis plants in order to prepare and scale for the global export of green ammonia.

Canada-Germany Hydrogen Alliance

In March 2021, Natural Resources Canada and the Federal Ministry for Economic Affairs and Climate Action established the Canda-Germany Energy Partnership. Hydrogen has been put at the forefront of the energy partnership and, with the bilateral hydrogen alliance, the two countries aim to strengthen cooperation in the export of clean hydrogen from Canada to Germany. Under the agreement, Canada and Germany will work to enable investment in hydrogen projects, support the build-up of hydrogen supply chains and establish a transatlantic Canadian German hydrogen supply corridor.

At the hydrogen conference this April in Hamburg, a Memorandum of Understanding to establish a joint H2Global funding window was signed. The H2Global mechanism is designed to provide planning security for both hydrogen production and applications.

EEHH member Mabanaft and the US company Pattern Energy signed a letter of intent in the presence of ministers Habeck and Wilkinson regarding a possible supply of green ammonia from Canada at the hydrogen conference in Hamburg. Pattern Energy is planning a new facility with a daily production capacity of around 400 t of ammonia. Powered by wind energy and hydrogen, production is earmarked to begin in the Canadian Province of Newfoundland in 2027.

The Hamburg Port Authority and the Port of Argentina entered into another agreement on a maritime corridor for the export and import of green hydrogen and its derivatives from Canada to Germany. The Port of Argentia partners with Pattern Energy in the development of Argentia Renewables, a 300MW onshore wind project to produce green hydrogen in Argentia. Both cooperations bring added momentum to the hydrogen economy in Hamburg.

The article includes facts and figures taken from the following sources:

  • Government of Canada
  • Canada Energy Regulator
  • Canadian Renewable Energy Association
  • Clean Energy Canada
  • Hydrogen Strategy for Canada
  • Province of Nova Scotia
  • adelphi
  • GTAI
  • Statista
  • Waterford Energy Services INC
  • Power Technology