Industrial gas company Air Products is betting on a shift towards low-carbon transport as part of national emissions reductions strategies to spur bus and truck companies to add hydrogen-powered vehicles to their fleets—despite the additional fuel costs.

The New York-listed firm is an equal partner in Saudi Arabia’s $5bn Helios Green Fuels hydrogen project along with state-owned Neom and the kingdom’s Acwa Power, having signed a deal in July 2020 to build, own and operate the plant.

“There are other exciting markets for hydrogen … but for this project we're focused on the bus and truck market” Moore, Air Products

Air Products is also the exclusive buyer of the hydrogen, which it will convert into 1.2mn t/yr of ammonia, shipping and selling it worldwide. The $67bn company will invest a further $2bn in the project’s downstream infrastructure.

Air Products will reconvert the ammonia into hydrogen for use as fuel by large trucks and buses, delivering the gas to transport refuelling stations. The company in April opened a hydrogen fuelling station at its industrial gases facility in South Korea’s Ulsan City, and has been involved in around 250 hydrogen fuelling projects globally.

“The interest level is incredible since we announced this project,” says Simon Moore, vice president for investor relations, corporate relations and sustainability at Air Products. “We see great opportunities around the world. There are other exciting markets for hydrogen, other transportation markets—trains, planes. Then there's the industrial side … but for this project we're focused on the bus and truck market.”

Helios will use 20 MW of Thyssenkrupp electrolysers, powered by renewable electricity, to make green hydrogen. Its annual production will be enough to supply 20,000 buses, while around 3mn buses worldwide are in operation today. As such, Moore is confident there will be sufficient demand from bus operators for hydrogen-powered vehicles—and with it, his green hydrogen—by the time the Neom plant is operational.

“When we talk about hydrogen in the future, it is about lower-carbon hydrogen. Hydrogen for transportation markets, for industrial applications— broadening it from the more classic use of hydrogen in the refining industry,” he says.

Helios’ partners have yet to decide how to fund the plant, but project financing is a possibility, Moore explains.

‘Game changer’

“This is not just a game changer for Air Products, it is a game changer for the world,” he says. “There isn't anything else like this, but while it is innovative in the sense of bringing all this together and in terms of scale…it is not a technology test programme. Each of the steps are well-proven.”

Although green hydrogen will remain expensive compared with grey and blue hydrogen and other fuels, Moore says cost will not be a decisive factor in shaping adoption of hydrogen-powered buses and trucks.

“The world clearly wants to move towards a lower-carbon footprint for transportation fuels. When you want to move in that direction, the politicians are reflecting the will of the people in general,” he says.

“We are not as focused on a direct economic comparison between say diesel and carbon-free hydrogen. It should come as no surprise to anybody to say carbon-free hydrogen is going to be more expensive than grey hydrogen.”

$3.7bn – Air Products’ investment in Saudi green hydrogen plant

Moore cited his company’s lengthy experience in transporting hydrogen, noting the huge expense in doing so over medium and long distances as well as the costs and inefficiencies in liquefying and distributing the gas. Such factors led Air Products, which is also building Saudi’s $11.5bn Jazan gasification plant, to decide on converting the Neom project’s hydrogen into ammonia.

“Obviously it does take a cost to turn hydrogen into ammonia, [but] based on its molecular properties it is much easier than transporting hydrogen,” says Moore. “It is really just a way to move those hydrogen molecules around. There's a robust global network to transport ammonia.”

Gasification, hydrogen and carbon capture are Air Products’ three key growth pillars, he says.

“We see a tremendous opportunity in part for the transportation market, but also to just to decarbonise existing hydrogen markets as well,” he adds.

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Author: Matt Smith