Revving up the hydrogen race

Published: 31.03.22

With big ambitions from EU policymakers comes a big need for rapid expansion in the green-hydrogen business.

Europe is the global leader in hydrogen production, and Nel is the world´s biggest electrode manufacturer, with products in 80 countries. Now the European Commission is aiming to make 20m tonnes of hydrogen a year by 2030, which will require between 120 and 200 GW of electrolyser capacity. In 2000, global electrolyser capacity was just 100 MW.

Nel´s new fully automated electrode plant at Herøya in southern Norway can produce 500 MW of capacity per year, and that can be ramped up to 2 GW. By 2025, Nel is targeting to increase its global production capacity to 10 GW, with new electrode factories in continental Europe, Asia, and America. 

Watch Nel´s CEO, Jan André Løkke, talk about the importance of this expansion with the CEO of Hydrogen Europe, Jorgo Chatzimarakis, in this video podcast:

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The hydrogen dream

“Reaching the EU´s targets will require huge investment, and a spirit of partnership between companies working in the hydrogen business,” Løkke says. But the returns on that investment promise to be sweet. Once hydrogen can be produced for $1.5 per kilo, it will achieve cost parity with fossil fuels. That target is getting close – only years away. And the increasing gas prices has narrowed the gap already.

The range of applications for hydrogen is already large. Nel´s customers include HYBRIT, (a joint venture with SSAB, LKAB and Vattenfall), that produces green-steel in Sweden with Volvo already using the metal to make vehicles; Iberdrola in collaboration with Fertiberia, a Spanish fertiliser manufacturer; companies combining CO2 with green hydrogen to make protein powder; heavy-vehicle manufacturers such as Nikola and Hyundai; and green-methanol producers, whose end products will be used as a fuel in deep-sea vessels such as those run by Maersk, a Danish shipping operator.

Energy interdependency on top of the agenda

With the war in Ukraine, energy interdependency has reached the top of the agenda for European policymakers.

“Many of the world´s conflicts over recent decades have resulted from energy disputes, or have in some way had energy politics at their core,” Løkke says.

The current tensions in Ukraine are, in this sense, no different: energy access and transit are being used to challenge peaceful Europe, reliant as the continent is on Russian hydrocarbons. Ukraine is the victim of this manipulation: without Europe´s energy interdependency, Russia would have had far less money, and far less economic and diplomatic leeway, to fund and pursue its aggression.

“Renewable energy and hydrogen will remove much of the interdependency we see in the carbon economy. Once wind turbines, solar arrays, hydrogen electrolysers, and batteries are in operation, nation states have unimpeded access to the energy they produce and store,” says Løkke.

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