Lightsource BP and Portuguese gas utility Dourogás are forming a joint venture to invest in solar and green hydrogen infrastructure in Portugal.
The partnership will explore the potential of eight green hydrogen sites.
Up to 200MW of solar projects developed by Lightsource BP will power 130MW electrolysers, developed by Dourogás, that will convert water to green hydrogen and oxygen.
The green hydrogen will be injected directly into the country’s gas grid. Further clean power could be drawn from the grid to optimise the usage of the electrolysers.
At its peak, more than 1000 direct and indirect jobs could be created by the new partnership. It is Lightsource BP’s first green hydrogen partnership.
The first project with Dourogás, Monforte, will benefit from a €5m grant from the EU's Portugal 2020 fund to support this early- stage deployment.
Green hydrogen has the potential to decarbonise a range of hard-to-abate sectors, the partners said.
It allows clean electricity to be converted into gas and transportable fuels such as ammonia.
These can displace natural gas and other fossil fuels opening new routes to a low carbon future where electricity is not an option, they added.
Lightsource BP country head for Portugal Miguel Lobo said: "Solar is scalable, quick to deploy and today, cheaper than any other form of electricity.
"We’ve always believed in solar as a vital tool in decarbonisation. When used to generate green hydrogen, it becomes an entire energy transition toolkit.
"The clean energy locked into these hydrogen molecules can immediately cut the footprint of industries, heavy transport and heat in ways electricity alone cannot.
"This partnership is a beacon of the possible. It shows what the energy sector can do not in 2050, or 2030 but right now.”
Dourogás group chief executive Nuno Moreira said: "This partnership between Dourogás and Lightsource BP results from the priority that these companies place on the development of new energy green projects.
"This partnership materializes, both in technical and dimension terms, the capacity and the vision of these two companies.
"It is undoubtedly a step forward towards the decarbonization of the economy to which Dourogás is committed, paving the way to a sustainable world for the next generation."
In September Lightsource BP set a new ambition to develop 25GW of solar power by 2025, up from 10GW by 2023.
The increase in pace will be supported by a $1.8bn (€1.59bn) credit facility announced alongside that new target.
Lightsource BP has an existing solar pipeline in Portugal of around 1.5GW outside of this new JV. It is also part of hydrogen consortiums in Australia and the UK.
Dourogás is developing a number of green gas projects both with biomethane and hydrogen. Dourogás is a natural gas utility supplying about 30,000 grid clients in 34 municipalities.