Germany’s Linde, the world’s top industrial gases company, announced on Monday it will invest $1.8 billion in Netherlands-based nitrogen producer OCI’s blue ammonia plant in the U.S. state of Texas to supply hydrogen. Linde said it will supply OCI clean hydrogen by sequestering more than 1.7 million tons of CO2 emissions each year, starting from 2025.

“Linde’s capabilities are already enabling the transition to a low carbon intensity economy,” Chief Executive Lamba said in a statement.

In 2022, Linde signed deals with BASF, BP and Airbus to jointly develop clean hydrogen projects, as governments and companies have been scrambling to curb emissions and scale up renewables across carbon intensive sectors to meet the EU’s net zero target by 2050.

Linde said it will build, own and operate an on-site complex at the OCI plant, which will include autothermal reforming, a process to produce low-carbon hydrogen with carbon capture, and a large air separation plant.

Lamba added that with support from the U.S. Inflation Reduction Act (IRA), the company is well positioned to secure future clean energy projects.

Under the multi-billion dollar IRA, Washington will subsidize products ranging from electric cars to solar panels as long as they meet requirements on being locally produced. The legislation has caused concerns in the European Union, which fear the measures could put companies based in Europe at a disadvantage.