Competition to make green hydrogen competitive continues

One type of hydrogen production uses electrolysis, in which an electric current splits water into oxygen and hydrogen. If the electricity used in this process comes from a renewable source, some refer to it as “green” hydrogen.

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Siemens Energy and Air Liquide have announced plans to establish a joint venture focused on the production of “industrial scale renewable hydrogen electrolyzers in Europe”.

The move, announced Thursday, represents the latest effort to find a way to reduce “renewable” or “green” hydrogen production costs and make the sector competitive.

The setting up of the joint venture – Siemens Energy will hold a 74.9% stake, while Air Liquide will hold a 25.1% – is subject to approval from the authorities.

If all goes according to plan, it will be headquartered in Berlin, with a facility to manufacture electrolysis modules or stacks based there as well.

Plans for electrolyser production in the German capital were announced earlier. Manufacturing is set to begin in 2023, reaching an annual production capacity of 3 GW in 2025.

The EU’s executive arm, the European Commission, has previously said it wants 40 GW of renewable hydrogen electrolyzers to be installed in the EU by 2030.

In February 2021, Siemens Energy and Air Liquide announced plans related to the development of a “large-scale electrolyzer partnership”.

Described as a “versatile energy carrier” by the International Energy Agency, hydrogen has a wide variety of applications and can be deployed in a wide range of industries.

It can be prepared in many ways. One method involves using electrolysis, in which an electric current splits water into oxygen and hydrogen.

Some call it “green” or “renewable” hydrogen if the electricity used in this process comes from renewable sources such as wind or solar. Today, the vast majority of hydrogen production is based on fossil fuels.

In October 2021, Christian Bruch, CEO of Siemens Energy, explained the challenges facing the green hydrogen sector. On Thursday, he stressed the scale going forward and the importance of cooperation.

“To make green hydrogen competitive, we need a sequentially produced, low-cost, scalable electrolyzer,” Bruch said in a statement. “We also need stronger partnerships,” Bruch said.

Air Liquide CEO Fran├žois Jaco described the creation of the joint venture as “a major step towards the emergence of a leading European renewable and low-carbon hydrogen ecosystem”.

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A joint venture plan by Siemens Energy and Air Liquide represents the latest effort by multinationals to set a marker in the green hydrogen sector.

Just last week, oil and gas supermajor BP said it has agreed to take a 40.5% equity stake in the Asian Renewable Energy Hub, a massive project for Australia.

In a statement, BP said it would become the driver of the development, adding that it “has the potential to be one of the world’s largest renewable and green hydrogen hubs.”

In December 2021, Iberdrola and H2 Green Steel said they would develop a 2.3 billion euro (about $2.42 billion) project centered around a green hydrogen facility with an electrolysis capacity of 1 gigawatt.


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