Chevron New Energies said it will develop a 5-megawatt solar-to-hydrogen production project in the Central Valley of California.
The facility will produce low-carbon hydrogen through electrolysis, a process of using electricity to split water into hydrogen and oxygen. The project will initially produce 2 tons of hydrogen each day, and the company claims its goal is to eventually create an expansive hydrogen refueling network. It will also make use of Chevron’s pre-existing operations by using existing solar power, land, and water from its Lost Hills Oil Field in Kern County -- hydrogen will be produced by using non-potable water produced as a byproduct of the oil facility, and solar energy will power the facility's electrolyzers.
The project will reportedly take multiple years to reach commercial operation and depends on regulatory energy policies, timely permitting, and obtaining the necessary materials to build. Hydrogen production is expected to commence in early 2026, the company said.
“This project will help develop key technical and commercial proof points as Chevron New Energies assesses concepts for future scale-up and new lower carbon intensity hydrogen production opportunities,” said Richard Chapman, president and CEO of Kern Economic Development Corporation. “By locating expected production in the Central Valley, we believe the project will be well positioned to meet the demand of customers along an important transportation corridor, as well as having proximity to key California urban markets.”
According to the International Energy Agency, oil and gas demand will need to drop by 80% by 2050 to meet goals outlined in the Paris Agreement. At COP28 last year, the conference concluded with a commitment to transition away from fossil fuels.
Although drilling for oil and gas continues, some oil companies have broadened their portfolio to include emissions-free energy and fuel products. Chevron’s New Energies unit was established in 2021, aiming to explore carbon capture technologies, hydrogen production, renewable fuels, carbon offsets, and other green technologies.
Late last year, the company partnered with Mitsubishi on an energy storage project in Utah, meant to produce about 100 tons of hydrogen daily and to store 300 gigawatt hours of energy. Meanwhile, the company just had to cease operations of its two biodiesel production facilities in the Midwest, reportedly due to poor market conditions and changing legislation that reduced the value of renewable energy credits for biofuels.
The company also said the new hydrogen facility’s success relies heavily on favorable legislation.
“I’m excited about the scalability of this solution,” Knight said. “However, our ability to meet growing hydrogen demand and help build hydrogen fueling infrastructure in California to a commercial scale with more widespread adoption will be strongly led by state and federal energy policies that promote new lower carbon energy solutions.”
