EDP Renováveis invested 25 million euros in the initial public offering (IPO), which would allow the French Lhyfe to raise more than 110 million euros in share capital and get access to Euronext’s regulated market in Paris.
In exchange, the Nantes firm inked an industrial agreement with the Portuguese energy company to “identify, develop, create, and jointly manage projects” in the hydrogen domain.
A “collaboration agreement to create green hydrogen production projects” was struck on May 6 between the world’s fourth-largest wind energy producer and a pioneer in green hydrogen production in Europe. However, the two corporations are only announcing the arrangement coming Tuesday in Portugal.
On the one hand, the EDP group takes another step in an area that is now a clear trend in the energy sector through its subsidiary EDP Renováveis. Lhyfe, on the other hand, has gained a powerful partner and the opportunity to develop hydrogen projects not only in Portugal, but also in 19 other countries such as the United States, Spain, and Brazil. In total, Portuguese energy has roughly 14 gigawatts (GW) of installed renewable energy capacity in 26 markets. France, Germany, Belgium, Holland, Denmark, Sweden, Finland, Norway, Spain, and Portugal are among the 10 European nations where the French corporation is working on projects.
“Under this arrangement, EDP Renováveis will deliver renewable power to Lhyfe’s hydrogen generating plants,” says Lhyfe founder and CEO Matthieu Guesné to DV Matthieu Guesné. Furthermore, the two businesses would “explore options for project co-development,” with EDP Renováveis’ involvement in each project “possibly reaching up to 50% of the capital.”
“The firms will also collaborate on R&D [research and development] initiatives in new projects and equipment procurement,” adds the manager.
“This agreement intends to produce value by using synergies between the two firms’ expertise and complementary capabilities, enhancing EDP Renováveis’ portfolio growth, particularly in France, and contributing to the development of Lhyfe projects globally,” he says. The signing of the deal would also allow the two organizations to “get better operational and commercial knowledge in renewable hydrogen projects.”
“We are ecstatic to have reached a deal with one of the world’s top renewable energy providers. The faith that EDP Renováveis has in us helps us to have faith in the global and large-scale growth of renewable hydrogen “, Matthieu Guesné emphasizes.
When questioned about Portugal’s significance in this arrangement, Lhyfe’s founder and CEO responded, “Portugal has a tremendous strategy for hydrogen development, which is why it is an essential target.” However, it makes no plans for further investments in the nation, either in collaboration with EDP or on its own.
Miguel Stilwell d’Andrade, CEO of EDP and EDP Renováveis, considers the deal with Lhyfe “essential” for the company he heads, noting that the energy industry aims to “advance the decarbonization of all sectors, particularly those with problematic electrification.” According to the management, hydrogen “can complement direct electrification as the greatest approach to cut carbon dioxide emissions and accomplish economic decarbonization.”
“By signing this deal, we are reaffirming our commitment to speeding the energy transformation while also moving closer to meeting our growth goals,” he says.
Following the IPO of French Lhyfe, which seeks to join Euronext Paris to identify sources of capital for ongoing initiatives, the deal with EDP was reached. The Nantes-based firm seeks to boost its activities through the stock market. EDP Renováveis has already committed to invest 25 million euros in the project from the start. If EDP Renováveis’ investment converts into 20% (or more) of Lhyfe’s capital at the end of the IPO, the Portuguese energy giant will have a representation on the French business’s board of directors.
Lhyfe has a portfolio of 93 projects in construction in Europe, with a total installed capacity of over 4.8 GW, 20 of which are now in advanced stages of development and are projected to be online by 2026. for installing another 3 GW by 2030. In addition, Lhyfe has had an industrial unit directly connected to a wind farm and a water supply since September 2021, and has successfully completed the electrolysis process. As a result, green hydrogen is already being supplied from the Vendée region of the Bay of Biscay. Given the maturity of the projects, the business claims to be a one-of-a-kind case in the world and “one of the largest and most sophisticated participants in the green hydrogen industry.”
Since the summer of 2021, when it joined the Torres Vedras Living Lab Green Hydrogen project, Lhyfe has been functioning in Portugal. It’s a “pact” between 28 organizations aimed at promoting hydrogen project development in the Intermunicipal Community of the West.
Miguel Stilwell d’Andrade’s business has previously said that it plans to build 1.5 GW of renewable hydrogen production capacity by 2030. Meanwhile, it has established H2BU, a business unit dedicated to renewable hydrogen projects and other “promising areas,” in light of the fact that hydrogen consumption is predicted to double to 530 tonnes per year by 2050. Green hydrogen is expected to account for 60 percent of total hydrogen demand by that time.
