Recently, two European electrolyzer manufacturers jointly announced a $250 million capital increase to help them expand their hydrogen production capacity. It is understood that with the EU significantly increasing the green hydrogen production target, many green hydrogen producers in Europe are rapidly expanding production capacity and driving down the cost of hydrogen production equipment from water electrolysis.
In March, Norwegian hydrogen company Nel said it had raised about $172 million in private financing and was considering issuing up to 10 million new shares, which would be used to expand production capacity. German hydrogen production equipment manufacturer Sunfire also announced a few days ago that it will cooperate with Copenhagen Infrastructure Partners and Blue Earth Capital to increase its investment of US$95 million through financing to expand production capacity.
At the same time, the scale of investment and deployment of water electrolysis hydrogen production projects in Europe is also expanding. In October last year, European hydrogen producer INEOS announced that it would invest more than 2 billion euros in the electrolysis of water hydrogen production project to build the first factories in Norway, Germany and Belgium to produce zero-carbon green hydrogen. Siemens Energy recently announced that it will invest about US$33 million to start the large-scale production of electrolyzed water hydrogen production equipment in Berlin, Germany, with an initial production capacity of about 1 million kilowatts per year.
The industry generally believes that the expansion of hydrogen production capacity from water electrolysis benefits from the favorable policies of many European countries. Taking Germany as an example, it passed the National Hydrogen Energy Strategy in 2020, and plans to deploy electrolyzers with a capacity of 5 million kilowatts in 2030, and is expected to expand to 10 million kilowatts in 2040. Since then, the European Commission has also launched a hydrogen energy strategy at the EU level, proposing to increase the green hydrogen production capacity in the EU to 40 million kilowatts by 2030.
According to a study released by the US investment bank Jefferies, it is estimated that by 2030, the world will need more than 400 million kilowatts of installed capacity electrolyzers for green hydrogen production, but at the current deployment rate, only 70 million kilowatts can be achieved by then. Deployment of capacity electrolyzers. Industry insiders believe that under the trend of global low-carbon energy transformation, the demand for green hydrogen will usher in a substantial increase, and the scale of hydrogen production by electrolysis of water needs to be continuously expanded.
In the EU's view, affected by the tension between Russia and Ukraine, EU member states are increasingly concerned about energy security. Therefore, it is necessary to continuously develop new energy sources such as hydrogen energy to further improve energy independence.
A few days ago, the European Commission proposed that the EU green hydrogen production target should be doubled, and the green hydrogen production capacity should be increased by 15 million tons per year by 2030 to reduce energy dependence. To this end, the European Commission said it will develop a regulatory framework to promote the development of the European green hydrogen market and support the construction of infrastructure such as hydrogen storage and ports.
It is worth noting that, under the trend of substantial expansion of production in the industry, the cost of electrolyzed water hydrogen production equipment is expected to drop rapidly. According to the International Renewable Energy Agency (IRENA), in the next 10 years, the cost of electrolysis of water for hydrogen production equipment is expected to fall faster than that of solar and wind power generation.
According to a report published by IRENA, the cost of solar modules fell by 82% between 2010 and 2019, while the cost of onshore wind power fell by 39% over the same period. “The price of purchasing electricity from solar and onshore wind farms has fallen significantly over the past 10 years. For hydrogen, a similar drop in electrolyser costs is expected over the next 10 years due to the growing scale of green hydrogen projects around the world.” IRENA To achieve this cost reduction target, the global green hydrogen capacity needs to exceed 100 million tons per year by 2030 and more than 400 million tons per year by 2050, which will require the deployment of about 136 million kilowatts per year by 2030 Capacity electrolyzers, of which 90% are alkaline electrolyzers and 10% are proton exchange membrane electrolyzers.
Christian Bruch, CEO of Siemens Energy, said that hydrogen energy is an important part of the future energy system, and the economic feasibility of hydrogen energy utilization can only be guaranteed if the manufacturing cost of electrolysis water hydrogen production equipment is greatly reduced.
