Sep 25, 2026
Spain has historically depended on imported oil and gas, but the country’s solar and wind resources and available land for large renewable installations are positioning it to become a major player in green hydrogen, according to Euronews. The report describes green hydrogen as an energy carrier rather than a primary energy source, meaning electricity must first be used to produce it through electrolysis, a process that splits water into hydrogen and oxygen.
Most hydrogen today is grey hydrogen, produced mainly from natural gas and generating carbon dioxide emissions. Green hydrogen instead relies on electricity from renewable sources such as solar or wind. According to Maarten Wetselaar, chief executive of Moeve, power accounts for roughly 70 percent of the cost of green hydrogen, and the Iberian Peninsula offers some of the cheapest renewable electricity in Europe, which he says makes the region’s green hydrogen highly competitive.
Moeve, formerly known as Cepsa, has started construction of Onuba in Palos de la Frontera, Huelva, the first phase of the Andalusian Green Hydrogen Valley. The project represents more than 1 billion euros of investment and will begin with 300 megawatts of electrolysis capacity, with a possible later expansion of another 105 megawatts. Moeve estimates the facility will produce around 45,000 tonnes of renewable hydrogen a year. The company aims to scale the wider Andalusian Green Hydrogen Valley to 2 gigawatts of capacity, with facilities in Huelva and Cadiz.
Wetselaar said the location was chosen because Huelva combines abundant renewable resources with industrial activity, port infrastructure and potential consumers relatively close to production. He added that connecting Huelva with other industrial areas in Europe, whether through pipelines or maritime solutions, would allow the plant to expand from 300 megawatts to 2 gigawatts and beyond, with the goal of creating a new industry in Spain.
Spanish Prime Minister Pedro Sanchez argued at the Huelva project launch that the technology can help cut emissions from activities that still depend on oil and gas, while also framing the bet in economic terms. He described the transformation as a way to protect against crises and to seize a major industrial opportunity. Sanchez also said the government has allocated more than 3 billion euros to over 120 renewable hydrogen projects, and Moeve’s project alone has received more than 300 million euros in public support. Spain has raised its electrolysis capacity target for 2030 to 12 gigawatts.
Sanchez said the strategy is not only about producing the molecule, but also about ensuring that electrolysers, valves, compressors and other equipment are manufactured in Spain. The goal is to develop a value chain around hydrogen, from production equipment to storage and transport infrastructure.
The report notes that green hydrogen remains generally more expensive than conventional hydrogen from fossil fuels, although the gap depends on factors such as gas prices, electricity costs, emissions taxes and project-specific conditions. Wetselaar argued that the current energy context is narrowing that gap, partly because gas prices are high, and he expects scaling up production to reduce the cost of electrolysers and installations, similar to previous cost declines in solar and wind technologies.
However, the trajectory is not guaranteed. Large-scale projects are needed to bring costs down, and companies investing billions need sufficient customers willing to buy the hydrogen. The report also raises questions about safety, noting that hydrogen is highly flammable and, because of its small molecules, requires particular attention to the tightness of equipment, pipes and connections. In enclosed spaces, a leak can create a flammable atmosphere if it reaches certain concentrations.
Moeve says its strategy prioritises preventing leaks rather than relying on detection afterwards. Maria Olavarria, head of the Production Department at Moeve’s La Rabida Energy Park, said the development of renewable hydrogen must go hand in hand with high safety standards, drawing on decades of industrial experience in handling the molecule. She explained that new facilities are designed to be leak-tight and feature several independent layers of protection. The company adds that automatic monitoring and detection systems are in place as an additional barrier to quickly identify anomalies during operation.
Energy security is another motivation. Wetselaar said Europe needs energy that is decarbonised, secure and produced within Europe. For Spain, the ambition means reversing the traditional energy flow: instead of importing fossil fuels, the country aims to generate renewable energy, convert it into hydrogen and derivatives, and supply its own industry and eventually other European markets. Wetselaar argued that if Spain becomes an energy exporter for the first time in its history, its relationship with the rest of Europe would change for the better.
A key project is H2Med, a corridor intended to link the hydrogen networks of Portugal and Spain with France and, from there, with Europe’s major industrial centres. The report notes that Spain has advantages including abundant solar and wind resources, capacity to keep rolling out renewables, industry, ports and a strategic geographical position, alongside strong public and private commitment. But leadership is not guaranteed.
Renewable hydrogen still accounts for a very small share of global production. Costs remain high, new transport and storage networks are needed, and sufficient industrial demand has yet to materialise to justify many announced investments. Producing much more renewable electricity will also be necessary, because green hydrogen can only contribute to decarbonisation if the vast amount of power it requires genuinely comes from new clean sources.
The construction of Onuba shows that some major Spanish projects are moving from announcements to construction. The hardest test now begins: proving that they can produce at scale, find enough buyers and do so at a competitive price. If Spain solves that equation, its sun and wind could turn a historic weakness, dependence on imported energy, into an advantage in the new European energy landscape.
