Concerted effort needed 'to maintain Europe's electrolysis lead'

A mix of industry and policy leadership is needed to maintain Europe's global position as a leader in sustainable hydrogen technologies, according to Nel's head of investor relations Bjorn Simonsen.

Nel is a Norwegian manufacturer of electrolyzers and hydrogen refueling systems. On Tuesday it announced a deal with France's Lhyfe Labs to supply up to 60 MW of electrolyzers to produce hydrogen for transport and industry applications.

"The long-term prospects for sustainable hydrogen have never been better, but in the short term everything is affected by the coronavirus, the world has slowed down," Simonsen said.

Installation of hydrogen fueling stations, for instance, had suffered due to travel restrictions and supply chain disruption caused by the virus, he said.

In late March, however, Nel US was defined as an essential manufacturing business and operations resumed at its Wallingford plant in Connecticut.

Nevertheless revenues and operations would still be negatively impacted by disruptions, Simonsen said.

In the longer term, industry and politicians had come together earlier in April to promote industry group Hydrogen Europe's "2 x 40 GW" initiative, he said.

This is designed to galvanize installation of 40 GW of electrolysis in Europe and 40 GW in neighboring countries by 2030, driving the cost of electrolysis below that of conventional steam methane reforming with CCS.

"[European Commission Executive Vice President] Frans Timmermans wants to make a success of this initiative," Simonsen said.

National policy support was building behind the EC's Green Deal, with the Netherlands' hydrogen strategy released earlier this month, and a similar strategy due in Norway in a month or two, he said.

The German government is also preparing a hydrogen strategy while the UK recently provided phase one funding for a slew of hydrogen project clusters, one being the Green Hydrogen for Humberside project, aimed at producing renewable hydrogen at scale from polymer electrolyte membrane (PEM) electrolysis.

"Europe certainly has a lead with a number of electrolysis manufacturers based here, but now is the time to step up the effort to maintain that position ahead of Asia," he said.

Already dominant in lithium battery manufacturing and increasingly strong in renewables, Asia was "waiting to take a position in renewable hydrogen," he said.

The good news was that the EU's Important Projects of Common European Interest (IPCEI) initiative would offer support to a number of large, pan-European hydrogen project deployments, Simonsen said.