Competition among manufacturers of electrolysers is increasing in Europe as a growing pipeline of green hydrogen projects begins to create demand for a regional supply chain. The focus is on ramping up to large-scale production and refining electrolyser technologies to reduce hydrogen production costs.

US power systems group Cummins and French hydrogen technology specialist McPhy have recently identified preferred sites for the construction of electrolyser manufacturing facilities on the continent, while Norway’s Nel is set to start testing a fully automated large-scale facility at Heroya, Norway. Also in Norway, state-owned Equinor is moving ahead with developing an ammonia production plant.

$1.5/kg – Nel’s target green hydrogen production cost by 2025

Cummins’ decision to set up in Spain will increase the pressure on local European manufacturers and is a coup for the Spanish government as it eyes a leading role in Europe’s emerging hydrogen industry, with the creation of hundreds of jobs.

“Cummins’ ability to construct a state-of-the-art electrolyser facility in Spain is a result of the strong support from the Castilla-La Mancha and Spanish governments,” the firm says.

The US company has chosen the Guadalajara area of Castilla-La Mancha in Spain to site a €50mn ($61mn) proton-exchange membrane (PEM) electrolyser plant that will initially operate at 500MW/yr and will be scalable to more than 1GW/yr.

Cummins has agreed to work with Spanish energy company Iberdrola to develop hydrogen projects in the region. Under the agreement, Cummins will supply the electrolyser for a 230MW green hydrogen project in Andalusia, which Iberdrola is developing to supply the fertiliser sector.

“Spain offers a strong and dynamic local environment for hydrogen production, and we are excited to invest here and significantly increase our manufacturing capacity in Europe,” says Cummins CEO Tom Linebarger. 

“Our partnership with Iberdrola will connect us with a major clean energy company and strategically positions us to be a European leader in green hydrogen production,” he adds.

Iberdrola says it has submitted 53 hydrogen-related projects to the Next Generation EU programme, the EU’s post-Covid recovery scheme, which could activate investments of €2.5bn. Cummins and Iberdrola are also collaborating on a hydrogen refuelling station in Barcelona.

Mature technology

Cummins’ move comes as McPhy confirms it has pre-selected Belfort in northeastern France as the preferred site for a “gigawatt-scale” electrolyser production site. McPhy’s expansion will focus on the more mature pressurised alkaline electrolysis technology, rather than the PEM technology favoured by Cummins. “The building of our Gigafactory is particularly strategic for McPhy’s growth,” says McPhy CEO Laurent Carme.

Meanwhile, Nel, a leading player in Europe, says it has prepared a technology roadmap to support its aim of producing green hydrogen at $1.5/kg by 2025.

A key element of this strategy is to expand electrolysis production to accommodate large-scale projects by constructing a fully automated manufacturing facility at Heroya, the company says.

Test production of the first 500MW production line will begin in the second quarter of 2021 with commercial ramp-up starting in the third quarter of 2021. The new facility could ultimately reach a capacity of “more than 2 GW”, Nel says.

“Our partnership with Iberdrola will connect us with a major clean energy company” Linebarger, Cummins

"Heroya represents the first industrial-scale production of the most efficient electrolysers on the market, at a game-changing low cost,” says Nel CEO Jon Andre Lokke.

Also in Norway, Equinor and carbon capture and storage specialist Horisont Energy have agreed to work together to advance a blue ammonia project.

The Barents Blue project would convert natural gas from the Barents South region to ammonia, capturing and storing the emissions in the Polaris reservoir off the coast of Norway.

If developed, Barents Blue would have a production capacity of 1mn t/yr of ammonia, making it one of the largest plants in the world. In the first phase of the project, Polaris would store 2mn t/yr from Barents Blue.

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Author: Stuart Penson