U.S. utility unveils plan to supply Los Angeles with green hydrogen

Feb 17 (Reuters) - Southern California Gas Co (SOCGP.PK), the largest U.S. gas utility, on Thursday unveiled a major proposal to deliver hydrogen produced by wind and solar energy to the Los Angeles area to help wean transportation, manufacturing and electricity sectors off of fossil fuels.

The project, dubbed the Angeles Link, would help California achieve its goal of carbon neutrality by 2045, the company said. It could one day deliver enough green hydrogen to equal nearly a quarter of the natural gas the utility delivers today.

SoCalGas, a division of Sempra Energy (SRE.N), also has a target of net zero greenhouse gas emissions in its operations by 2045. The company expects to meet that goal by supplying its nearly 22 million customers increasingly with gas produced from organic waste and hydrogen.

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Companies and governments have touted green hydrogen, derived from water using electrolyzers powered by renewable energy, as a way to cut carbon emissions, particularly for sectors like heavy industry that are difficult to electrify. SoCalGas said a new pipeline would transport the hydrogen from parts of the state with large renewable energy resources into the Los Angeles area.

It now costs about four times more to make green hydrogen than that made with natural gas, a fossil fuel.

SoCalGas said the Angeles Link, which could help replace up to 3 million gallons of diesel fuel per day in the region's trucking industry and convert up to four gas power plants to hydrogen, will help reduce the fuel's cost.

"Economies of scale are important to bring down the cost of the delivered hydrogen," Neil Navin, vice president of clean energy innovations at SoCalGas, said in an interview. "That's the importance we see in our project. Delivering hydrogen at scale will help to reduce that cost."

With Thursday's announcement, SoCalGas said it was initiating steps to define the scope of the project, including a timeline for construction and operation. It yet to identify a company that would produce the hydrogen.

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Reporting by Nichola Groom Editing by Alistair Bell

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