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Norway's HydrogenPro ramps up global electrolyzer capacity with Chinese JV

Highlights

300 MW/year production capacity from China factory

Pilot production to start by end of year

Targets $1.2/kg hydrogen production in 2022

Norwegian renewable hydrogen plant manufacturer HydrogenPro has taken a step to ramp up global electrolyzer production capacity, launching a joint venture with China's Tianjin HQY Hydrogen Machinery Co., or THM, to establish a 300 MW/year production line, the company said in a statement Nov. 17.

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The joint venture will allow HydrogenPro to use THM's alkaline electrolyzer technology globally and drive down hydrogen production costs.

Pilot production is expected by the end of the year, ramping up to 300 MW/year at full capacity, with "substantial room for further expansion," HydrogenPro said.

"This transaction gives HydrogenPro full control over intellectual property and core electrolyzer technology that is key to our global fabrication plan," HydrogenPro CEO Elling Nygaard said in the statement.

Nygaard took over leadership of HydrogenPro from Marten Lunde in October.

"The joint venture will be very cost-effective and serve clients all over the world until our global fabrication set-up is completed, complying with all regulatory standards in the relevant locations," Nygaard said. "The next steps will be to establish footprints outside of China, based on technology and experience from the joint venture, to maintain cost leadership and to ensure high local activity in our end-markets."

"THM will transfer employees, fixed assets and intellectual property to the joint venture, which will be 75% owned by HydrogenPro and 25% by the current owners of THM," the statement said.

The factory will be based in Tianjin, China, and will be equipped with new machinery that has already been purchased, it added.

THM produces electrolyzer components, parts and systems to supply the industry in China, and has expanded into assembly and sales of complete electrolyzer units, it said.

HydrogenPro is targeting hydrogen production costs of $1.2/kg in 2022 with its core high-pressure alkaline electrolyzer product.

S&P Global Platts assessed calculated costs of alkaline electrolysis hydrogen production in Europe (Netherlands, including capex) at Eur12.19/kg ($13.79/kg) Nov. 16, driven by soaring spot power prices, and up from around Eur4/kg at the start of the year. By contrast, costs in low-cost locations such as Australia were $2.79/kg.

The company said it will leverage its new technology for large industrial hydrogen installations, reducing power consumption by 14%, enabling electrolyzers to reach 93% of the theoretical maximum, giving a "significant cost advantage."

The costs of electricity account for around 70%-90% of hydrogen production costs, depending on market prices, HydrogenPro said.

"THM's unique intellectual property and experience in the manufacturing of cost-competitive high-pressure alkaline electrolyzers makes them an ideal partner," Nygaard said.

HydrogenPro will combine THM's technology with its own electrode technology from Denmark to increase electrolyzer efficiency.

This will, Nygaard said, deliver hydrogen "at the absolute lowest cost in the market for the time being."

The company is investing around NOK48 million ($5.5 million) in the project.

"We regard this moderate investment in state-of-the-art production capacity to be in line with our asset light approach to developing a global supply chain," Nygaard added.