The joint venture between bp and Iberdrola has announced the start of construction work on Spain’s largest green hydrogen project, with a capacity of 25 MW. The project could generate up to 500 jobs during the construction phase , which will involve the participation of approximately 25 Spanish companies.

The first stage of the project consists of earthmoving and preparation of a site of approximately 20,000 m2 located near the BP refinery in Castellón. Civil works will begin in the second quarter of the year .

The next milestone of the project will be the delivery and installation of the first main equipment, including the electrolyzers , which should occur in the second half of 2025. This equipment is responsible for producing green hydrogen through a chemical process (electrolysis) capable of separating the hydrogen and oxygen molecules that make up water, using electricity from renewable sources.

Carolina Mesa , bp’s vice president of hydrogen for Spain and new markets, said: “The start of construction of Spain’s largest green hydrogen plant is excellent news as it represents a concrete step forward in a project that is crucial for industrial decarbonisation. bp’s Castellón refinery is set to become a model for transforming refineries into integrated energy hubs.”

Jorge Palomar Herrero , Iberdrola's Hydrogen Development Director, highlighted: "This project is already enabling the real development of the hydrogen value chain in our country, with key equipment manufactured in Spain and employing more than 25 local companies. In addition, the project requires 200 GWh/year of renewable energy from Iberdrola's wind and photovoltaic plants in Spain, meeting all EU requirements to ensure that the hydrogen produced is green hydrogen."

The announcement reinforces bp and Iberdrola’s leadership in the hydrogen sector, an energy vector that has the potential to play a significant role in the decarbonization of the industry . In addition, Iberdola and bp continue to advance their partnership to accelerate electric mobility and lead the high-power public charging segment in Spain and Portugal.

The largest green hydrogen plant in Spain

The project will receive an investment of more than 70 million euros and is being developed jointly by bp and Iberdrola España through Castellón Green Hydrogen SL , a company created with equal participation between the two companies. The plant is expected to be operational in the second half of 2026.

The 25 MW electrolyser will be powered by renewable electricity through a power purchase agreement (PPA) provided by Iberdrola from photovoltaic and wind farms.

It is estimated that the production of 2,800 tons of green hydrogen per year will replace part of the gray hydrogen currently used by the refinery in its processes. This would prevent the emission of approximately 23,000 tons of CO2 per year , which is equivalent to the emissions of 5,000 cars in the same period.

In future stages of the project, the green hydrogen produced could also be used in important industries in the Valencian Community that are difficult to decarbonize , such as the ceramics sector, to replace the natural gas used in their processes, the chemical industries and heavy transport.

This initiative, which has the participation of the Instituto Tecnológico de Energia (ITE) , has obtained funding equivalent to 15 million euros from the support programs for the Innovative Value Chain and Knowledge of Renewable Hydrogen of the Recovery, Transformation and Resilience Plan of Spain, with resources from the NextGenerationEU program of the European Union.

Trust in Spanish companies

The companies recently awarded the manufacturing and supply of the transformer to Spanish company Imefy . Based in Toledo, the La Mancha-based company will manufacture, supply and supervise the assembly and operation of the three-phase power transformer, with 37 megavolt-amperes (MVA) of power and 66/30 kilovolts (kV) of transformation ratio . Delivery is scheduled for the first quarter of 2026.

This concession reflects the confidence that bp and Iberdrola, through the company created for the Castellón Green Hydrogen project, have in Spanish companies for the development of the renewable hydrogen value chain. The initiative contributes to the structuring of the territory and the creation of industrial and innovation opportunities in a growing market , acting as a driver of development.

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