H2U raises $11 million for tech aimed at replacing precious metals in electrolyzers

The hydrogen technology company H2U has secured $11 million in funding to advance two electrolyzer technology developments that it says will help grow electrolysis to grid scale, the company said March 2.

California-based H2U has designs for its Gramme 50 GS series PEM electrolyzer, which it describes as a "disruptive design" made to drive grid-scale adoption of electrolysis. The company is also developing its proprietary Catalyst Discovery Engine, a data-driven process used to discover inexpensive metals that can be used in lieu of precious metals in electrolyzer manufacturing.

The $11 million Series A funding round attracted investments from venture capital energy firms such as Jericho Energy Ventures, Freeflow Ventures, Volo Earth Ventures and Hess Corporation. The capital raise was the second tranche investment after an initial Series A tranche in 2021, which generated $7 million. The funds will go towards further development of both H2U's electrolyzer design and its Catalyst Discovery Engine.

"H2U's cutting-edge technology will play an integral role in accelerating the production and deployment of clean hydrogen to advance the energy transition," Jericho Energy Ventures CEO Brian Williamson said in the March 2 statement.

The company's Catalyst Discovery Engine collects data to quantify "the catalytic activity of millions of compositions per month," then uses artificial intelligence and big data analysis to discover new metals that can be used as a catalyst in water electrolysis, or the process that splits hydrogen from oxygen in water molecules.

The central technology in the water electrolysis process is a proton exchange membrane, or PEM, which uses both iridium and platinum as a catalyst for producing the hydrogen. But both those metals "are expensive and rare, offering serious bottlenecks in hydrogen's plans to replace gas worldwide," a 2019 Stanford University study found.

According to Platts assessments from S&P Global Commodity Insights, Iridium in North America cost $4,300/toz as of March 1. Platinum cost about $1,065/toz on March 2.

High, fluctuating prices of these precious metals can inflate the cost of electrolyzers and stymie the adoption of green hydrogen worldwide, H2U says.

"Most expect demand for rare earths to increase dramatically in the coming decades," H2U said in its statement. "To prevent shortages in critical minerals that would interfere with today's primary pathway for clean hydrogen production, the industry needs to materially reduce or fully eliminate its reliance in expensive, finite and singly sourced rare earth metals."

The company's Catalyst Discovery Engine will be able to "identify earth-abundant alternative catalysts at a rate one million times faster than known industry methods," which could ultimately unlock low-cost clean hydrogen.

The company will leverage the Catalyst Discovery Engine to create its Gramme 50 GS series PEM electrolyzer, which will use non-precious metals as a catalyst.

"H2U has discovered abundant, low-cost catalysts for green hydrogen production, replacing rare, expensive [precious group metals]," said H2U CEO Mark McGough. "Coupled with H2U's novel, low-cost electrolyzer design, we and our partners will produce least-cost green hydrogen, so we are thrilled to have such support from new and existing investors."

Platts price assessment of clean hydrogen produced using PEM electrolysis (including capex) in Southern California was at $4.14/kg on Feb. 28.