September 12, 2022 • Paul Rodden • Season: 2022 • Episode: 146
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In episode 146, Bosch invests big and making fuel cells in the United States. JERA, Uniper and ConocoPhillips announced an agreement. And Air Liquide has a new credit rating. All of this on today’s hydrogen podcast.
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Bosch invests big and making fuel cells in the United States. JERA, Uniper and ConocoPhillips announced an agreement. And Air Liquide has a new credit rating. All of this on today’s hydrogen podcast.
So the big questions in the energy industry today are, how is hydrogen the primary driving force behind the evolution of energy? Where is capital being deployed for hydrogen projects globally? And where are the best investment opportunities for early adopters who recognize the importance of hydrogen? I will address the critical issues and give you the information you need to deploy capital. Those are the questions that will unlock the potential of hydrogen and this podcast will give you the answers. My name is Paul Rodden, and welcome to the hydrogen podcast.
In an article from forbes.com, Alan Ohnsman writes, Bosch is investing $200 million to make fuel cells for hydrogen trucks in South Carolina. Bosch the German conglomerate that makes everything from dishwashers to industrial software and security systems is investing $200 million in its auto parts Factory in South Carolina to produce fuel cell stacks to supply an emerging market for zero emission trucks powered by hydrogen. The company expects to add 350 workers to staff the new assembly line and cleanroom in Anderson, South Carolina, Peter Tadros Bosch’s North American head of powertrain solutions tells Forbes it will be Bosch’s first US fuel production site when it’s up and running in 2026. Electric truck maker Nikola, which Bosch is invested in will be a key customer for the power devices, but it will also sell them to other companies in North America. He said he continues to say initial interest in this technology is for the large commercial vehicles.
Nikola will get fuel cells for its trucks from Bosch has operations in Germany when it starts producing hydrogen trucks next year. But quote, as a manufacturing partner here with Nicola Anderson will serve as them for our regional strategy of local for local. The investment comes on the heels of the US inflation Reduction Act signed into law this month that provides incentives for building and buying vehicles powered by hydrogen, as long as it’s green and made from sources that emit no carbon pollution. Hydrogen fuel cells are an alternative source of electric power for vehicles. But whereas batteries store electricity for propulsion, fuel cells make it on demand. In addition to Nikola companies, including Cummins, General Motors, Toyota, Volvo, and Daimler are all developing different types of hydrogen powered trucks that will start hitting the market next year. Battery trucks which Nikola already sells work well on shorter runs, ideally less than 300 miles. companies developing hydrogen powered versions think that system is a better option for long haul runs as fuel cell systems aren’t much heavier than diesel engines and the refueling time is comparable. New us emission regulations and clean energy programs like the IRA are benefiting the hydrogen industry. This according to Tadros. He says it’s getting the word out there providing some incentive for manufacturing and tax credits also help the consumer.
He also says that combination really supports our view of where hydrogen is going. Bosch has had production operations in South Carolina since 1985, where it currently makes sensors and electronic control units for automotive power trains. It follows companies including GM and Honda plug power and Ballard power, which already make fuel cells at plants in the US and Canada. Okay, so this is now the second announcement we’ve seen from Bosch on their plans to dive into the hydrogen economy, this time with a $200 million investment in developing fuel cells. The nice thing about it is that they also already have an off taker waiting for these fuel cells to implement. That is Nikola. So the question now is when all of these other companies start developing and bringing their fuel cell trucks to the United States, will this alignment between Bosch and Nikola give the two companies a head start, and will Hyzon be able to compete with Nikola and Bosch when the two of them line up and actually start selling these trucks. Next on a press release on September 5, JERA and Uniper announced collaboration on green ammonia and LNG from the United States.
JERA and Uniper are collaborating to facilitate the development of the initial production of a 2 million tonne per year of clean ammonia, with expansion potential of up to 8 million tonnes per year to greatly accelerate the production and supply of zero carbon fuels from the US for use in the US, Europe, Japan and greater Asia to propose facility on the US Gulf Coast developed by JERA and ConocoPhillips aims to reduce hydrogen and convert it into clean ammonia to be supplied to JERA and Uniper under long term sale and purchase agreements with Europe as the primary initial export market with Uniper target about 1 million tonnes per year of green ammonia from all sources by the end of the decade. A project engineering study will be completed by year end to develop the first phase of this landmark project, which will assess green and blue hydrogen opportunities. It is expected to reach commercial operation in the late 2020s, including a complete certified CCS program. Both companies are working jointly to optimize their LNG portfolio. As a result, Uniper will be able to supply additional LNG to Germany and JERA to Japan and beyond. And a quote from Steven Winn Chief Executive Officer of JERA, Americas based in Houston said JERA is committed to providing cutting edge solutions to the world’s energy issues and is actively working to establish both the ammonia and hydrogen value chains.
The combination of a skilled workforce plentiful natural gas, abundant renewable resources, deepwater ports, and ideal CCS geology make the US Gulf Coast uniquely advantaged to produce the low carbon fuel to enable the Atlantic and Pacific Energy market transitions. JERA and ConocoPhillips will be a low cost ammonia supplier to domestic and international markets. He says that he believes this project offers a unique opportunity to support Germany’s decarbonisation efforts, while advancing ammonia technology development for hydrogen distribution and industrial decarbonisation. And in a quote from Yukio Kani JERA, corporate vice president and managing executive officer of JERA, Inc, headquartered in Tokyo added JERA is working in markets around the world with our business partners to deliver cleaner energy supply and power generation solutions. JERA advanced technologies to meet its commitments as a low carbon fuel supplier and end user together with Conoco Phillips, low carbon innovation and Uniper proven low carbon technologies would support the energy evolution in the US, Europe, Japan and Asia.
They also see this collaboration as a positive step to help Europe Germany and other users during this time of crisis with new low carbon energy supplies coming from the US. Okay, so a fun announcement that really I think downplays the involvement of ConocoPhillips in this venture. Now, ConocoPhillips knows natural gas, and they are very good at their downstream ventures. And I don’t think that ConocoPhillips will have any trouble at all furthering their hydrogen ventures going from gray to blue. But really what this announcement provides Conoco Phillips with hydrogen off takers from their refineries in the Gulf Coast, that being one of the potential red flags for refineries in the Gulf Coast, not diving further in to the hydrogen economy. And lastly, in a very short, but very important press release on September 6, Air Liquide says Moody’s upgrades the Air Liquide group credit rating Air Liquide, welcomes Moody’s credit rating agencies decision to upgrade the group’s long term rating to a two versus a three previously, as well as its short term rating to p one as opposed to P two before the outlook associated with these ratings is stable. These ratings relate to all debt instruments issued by Air Liquide SA and Air Liquide finance. To explain its decision to upgrade its long term rating, Moody’s highlights the stability and the resilience of the group’s earnings and cash flow generation.
The upgrade of the short term ratings reflects in particular Air Liquide Strong liquidity profile. This upgrade is in line with the group’s 2025 strategic plan called advance with its context of this plan launched in March of 2022. The group has committed to strongly increase its investment while keeping a particularly strong balance sheet in line with an a range rating. So congratulations to Air Liquide in their upgrade in their credit rating. Now, why is this press release a big deal? Well, in terms of the hydrogen economy, Air Liquide is one of the oldest and largest hydrogen transporters in the world. And with their advanced 2025 strategic plan, they’ve announced an even greater emphasis on investing in hydrogen.
And so what this should tell any publicly traded company looking to invest more in hydrogen is that if your balance sheet looks good, and your debt structure is solid, maybe putting more emphasis on hydrogen isn’t going to affect your credit rating.
All right, that’s it for me, everyone. If you have a second, I would really appreciate it if you could leave a good review on whatever platform it is that you listen to Apple podcasts, Spotify, Google, whatever it is, that would be a tremendous help to the show. And as always, if you have any feedback, you’re welcome to email me directly at firstname.lastname@example.org. And as always, take care. Stay safe. I’ll talk to you later.
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