Paul Rodden • Season: 2023 • Episode: 239
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Welcome to The Hydrogen Podcast!
In episode 239, Walmart continues their hydrogen investment this time in South America. And a new electrolyzer is getting developed to strategically target heavy industry and drastically reduced the electrolytic hydrogen price point. I’ll go over all of this on today’s hydrogen podcast.
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Paul Rodden
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Transcript:
Walmart continues their hydrogen investment this time in South America. And a new electrolyzer is getting developed to strategically target heavy industry and drastically reduced the electrolytic hydrogen price point. I’ll go over 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 a press release on August 15, Walmart Chile to create first industrial use green hydrogen production plant in Latin America. Last week, Walmart Inc. CEO Doug McMillon, attended the grand opening of a green hydrogen plant at Walmart’s Quilicura Distribution Center in Santiago, Chile, representing the company’s continued investment in and commitment to renewable energy, industrial scale and renewable the project was developed collaboratively with a generating company Engie once converted the plant is the first of its kind in Latin America, and will play a key role in Walmart Chile’s path to net zero emissions. Walmart Chile CEO Cristián Barrientos, Chile Minister of Finance Mario Marcel, Chile Minister of Energy Diego Pardow and Engie Chile Chief Corporate Affairs Officer Pablo Villarino joined McMillon for the event recognizing the opening of the plant as a critical step in Walmart’s global commitment to become a regenerative and zero emission company by 2040. And a quote from Barrientos, We see tremendous potential for our business and want to expand the use of this technology to all distribution centers and the company’s logistics network throughout the country with the aim of operating 100% green hydrogen by 2025.
He also says we are already exploring new uses in the area of transport and emergency services, where we already have pilots in operation. In its first stage, the green hydrogen plant will allow the Quilicura distribution center to replace the lead acid batteries of 200 Forklift cranes with hydrogen energy cells, cutting 250 tons of toxic waste per year. Over the course of the 15 year project. Walmart expects to reduce the release of co2 in the atmosphere by 17,100 tonnes, the equivalent of planting 34,200 trees and an a quote from McMillan Walmart first embrace the potential of hydrogen fuel in 2012, with a fleet of 50 vehicles and forklifts in the US, which have since grown to over 9500 forklifts. Now with over a decade of experience and progress. Walmart is well positioned to invest in Chile’s potential as a producer of clean energy, including green hydrogen, Chile’s potential is tremendous.
The Chilean government has made renewable energy a priority. And as a result, Chile and solar and wind power sectors have increased their generation capacity five fold over the last few years, with up to 70% of the country’s electrical grid projected to be renewable powered by 2030. This gives Chile a unique opportunity to develop a competitive green hydrogen industry powered by low cost renewable resources while driving a sustainable economy around it. Walmart has made impressive and meaningful advances towards his climate goals like incorporating renewable sources through self generation, and the purchase of certified renewable energy. Today 84% of Walmart Chile’s consumption currently comes from clean energy sources, and it’s over 390 facilities are on track to reach the goal of operating with 100% renewable energy well before their global commitment to do so by 2035. Again, according to Macmillon, we’ve set a goal to become a regenerative company, a company that leaves things better than we found them. The energy transition our world needs isn’t an easy one. But by working together, we can do it.
Okay, so some very interesting news from Walmart and some very positive news for Chile. Now, this comes on the heels of our talk about Amazon promoting hydrogen and what it looks like for a global juggernaut Corporation navigating the geopolitics of the energy transition. Now we have a small peek behind the curtain of where and how Walmart is focusing some of their attention and investment in hydrogen. And Chile is a prime location for this. While most organizations are looking at either North America, Europe or Asia, there’s a great opportunity in South America, specifically Chile for hydrogen generation. Chile nine out of 10 for oil and gas producers in South America as such, they’re a net importer for energy resources. So with that mindset, there’s a huge opportunity there for electrolytic hydrogen, and Walmart has taken notice. They and others are starting some rather large investments into the hydrogen economy in Chile, and I do see some good potential there. Now the question remains outside of Walmart, what other offtake opportunities for hydrogen are currently available and what could be available in the near future? Once we can answer that question, I think we’ll see more attention and investment that’s going to shift to South America, specifically Chile. Next, in a press release on August 15, BP leads 12 and a half million dollars series A investment in advanced ionics. Advanced ionics, the developer of a new category of hydrogen electrolyzers, useful for expanding green hydrogen production, closed a 12 and a half million dollar series a financing led by BP ventures with additional investors, including clean energy ventures, GVP climate and Mitsubishi Heavy Industries.
The new capital will help catalyze advanced ionics growth and facilitate the initial deployment of its Symbion water vapor electrolyzer technology for heavy industry. Water vapor electrolyzers address two of the biggest obstacles to expanding green hydrogen production cost and electricity requirements. In a quote from Chad Mason, the CEO of advanced ionics BP ventures investment in Advanced ionics is a powerful backing of our technology’s potential to help accelerate green hydrogens future and Heavy Industries shift toward decarbonisation. The results we’ve achieved in our testing along with early customer interest have indicated that we are an ideal technology provider for industrial customers looking to augment, expand or replace their existing hydrogen production facilities with green hydrogen. The company’s water vapor electrolyzer helps reduce the cost and electricity requirements for green hydrogen production by symbiotically integrating with standard industrial processes to harness available heat. The system is made of widely available Steel’s and other simple materials, rather than expensive metals or materials common and other electrolyzers. electricity use accounts for more than 70% of green hydrogen production costs. Advanced ionics electrolyzer stack requires less than 35 kilowatt hours per kilogram of produced hydrogen compared to more than 50 kilowatt hours per kilogram for typical electrolyzers. This lower electricity requirement could make green hydrogen accessible for less than $1 per kilogram at scale. And a quote from Gareth burns, Vice President of BP ventures advanced ionics technology has the potential to drive down costs and disrupt the hydrogen market.
BP has a global portfolio of hydrogen projects. And as the world transitions into a net zero future, it’s important for us to be investing in these technologies and advanced the track to deploying green hydrogen. He says we look forward to working with Advanced ionics on the next stage of its growth. Advanced Ionics will use the funds to expand its team and deliver its next generation electrolyzer systems to early customers. The company has already demonstrating the efficacy of its product through a pilot program with a global energy company Repsol Foundation, in addition to BP ventures investment, BP will also be exploring pilot opportunities with advanced ionics. Other investors in Advanced ionics include Aster, and angel investor collectives Clean Energy Venture Group and SWAN Impact Network. Hydrogen is one of BPS five transition growth engines, which also includes bio energy, convenience, electric vehicle charging, and renewable and power. BP plans to increase its investments in those businesses through this decade, while at the same time investing in today’s energy system, as it delivers that strategy of becoming an integrated energy company. Well, a big congratulations to advanced ionics on their series, a fund round. Now as you all know, if it’s possible, I like to focus on the economics of whatever it is that I discuss since ultimately, it’s the economics that drive decision making.
And there are some new technologies coming to market now and in the near future, that have the potential to be complete game changers on how we think about cost competitiveness with legacy energy sources. This application that Advanced ionics has developed, while more niche than other electrolyzer companies looks to strategically target one of the if not the largest potential offtake opportunities in the near term hydrogen utilization, and that’s heavy industry. Now, the price per kilogram they quote in this piece of under $1, a kilogram is vital and right now, I don’t know if that’s including any government incentives, but either way that price point makes the conversion to hydrogen extremely appealing for heavy industry wanting to decarbonize. One point that sneaks into this release also is the statement that they’re using steel and other simple materials for these electrolyzers, meaning their system price could be significantly reduced, along with potential reductions in maintenance costs. This is a big win for electrolytic hydrogen in heavy industry. And I cannot wait to see how this scales.
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, YouTube, whatever it is, that would be a tremendous help to the show. And as always, if you ever have any feedback, you’re welcome to email me directly at info@thehydrogenpodcast.com. So until next time, keep your eyes up and honor one another. Hey, this is Paul. I hope you liked this podcast. If you did and want to hear more. I’d appreciate it if you would either subscribe to this channel on YouTube, or connect with your favorite platform through my website at www.thehydrogenpodcast.com. Thanks for listening. I very much appreciate it. Have a great day.
