Paul Rodden • Season: 2024 • Episode: 299
Listen Now:
>Direct Link To The Hydrogen Podcast MP3<
Listen On Your Favorite App:
Welcome to The Hydrogen Podcast!
In episode 299, Ballard is bringing in a huge chunk of cash from the DOE and VC investments in hydrogen are on the rise. I’ll go over all of this and give my thoughts on today’s hydrogen podcast.
Thank you for listening and I hope you enjoy the podcast. Please feel free to email me at info@thehydrogenpodcast.com with any questions. Also, if you wouldn’t mind subscribing to my podcast using your preferred platform… I would greatly appreciate it.
Respectfully,
Paul Rodden
VISIT THE HYDROGEN PODCAST WEBSITE
https://thehydrogenpodcast.com
CHECK OUT OUR BLOG
https://thehydrogenpodcast.com/blog/
WANT TO SPONSOR THE PODCAST?
Send us an email to: info@thehydrogenpodcast.com
NEW TO HYDROGEN AND NEED A QUICK INTRODUCTION?
Start Here: The 6 Main Colors of Hydrogen
Transcript:
Ballard is bringing in a huge chunk of cash from the DOE and VC investments in hydrogen are on the rise. I’ll go over all of this and give my thoughts 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’s 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 March 14, Ballard announces $40 million in DOE grants to support build out of integrated fuel cell production giga factory in Rockwall, Texas. Ballard Power Systems announced it has received notification from the Hydrogen and Fuel Cell Technologies Office within the U.S. Department of Energy (DOE) that Ballard’s applications for two grants totaling US$40 million under the Clean Hydrogen Electrolysis, Manufacturing, and Recycling Program have been selected and recommended for negotiation of financial awards. The grants will support Ballard’s construction and build-out of an integrated fuel cell production Gigafactory based in Rockwall, Texas.
Ballard plans for the new facility, dubbed Ballard Rockwall Giga 1, to be located on a parcel of 22 acres of industrial land within the Rockwall Technology Park in Rockwall, Texas. In Phase I, Ballard plans to invest approximately US$160 million (net of the US$40 million in expected DOE grants) from 2024 through the end of 2027 to build and commission a new manufacturing facility with annual production capacity of 8 million membrane electrode assemblies (MEAs), 8 million bipolar plates, 20,000 fuel cell stacks, and up to 20,000 fuel cell engines per year, or the equivalent of 3 gigawatts of fuel cells. The land acquisition rights and facility design provide Ballard with optionality for additional future phases at the Rockwall site. Future phases are expected to further increase production scaling and capacity expansion with much lower capital requirements. The facility represents the next stage of Ballard’s ‘local for local’ and advanced manufacturing strategy.
Ballard expects to make a final investment decision on this facility later in 2024, pending completion of customary conditions, including necessary approvals, negotiation of final awards with the DOE, and definitive agreements. The $40 million in total DOE grants comprise a $30 million grant relating to advanced proton exchange membrane (PEM) MEAs and automated stack assembly, with the additional $10 million grant relating to a next-generation flexible graphite bipolar plate manufacturing line. The grants have been awarded by the U.S. DOE’s Hydrogen and Fuel Cell Technologies Office to implement provisions of the Bipartisan Infrastructure Law, providing for the award of $750 million for Clean Hydrogen Electrolysis, Manufacturing, and Recycling. Ballard has also applied for additional funding under other U.S. government funding programs.
“We are thrilled to be recommended for participation in the Clean Hydrogen Electrolysis, Manufacturing, and Recycling Program,” said Randy MacEwen, Ballard’s President & Chief Executive Officer. “We are grateful for the strong support of the DOE’s hydrogen policies that position the U.S. for future scaling of hydrogen and fuel cells. This is particularly important as the U.S. accelerates a path towards environmental sustainability and energy security, while continuing to boost domestic manufacturing and bolster critical supply chains. We are also excited to unveil the next stage of our ‘local for local’ manufacturing strategy, which will feature cutting-edge fuel cell manufacturing technologies across our fuel cell production value chain, enabling cost competitive solutions at scale.” Ballard has also received considerable support from the Rockwall Economic Development Corporation (REDC), which owns and manages the Rockwall Technology Park.
The REDC has provided an attractive mix of land, financial, fee and permit incentives for the facility, while assisting in the planning and approval process. The facility will also benefit from its proximity to the Gulf Coast hydrogen hub. And in a quote from Dr. Lee Sweetland ballard’s Chief transformation officer. With an increasingly constructive policy environment and growing customer interest. It is critical to invest in these innovative manufacturing line. We have been working hard to develop next generation automated production processes for MBAs bipolar plates and stack assembly that will position Ballard to meet expected future market demand while significantly driving down the cost of our market leading fuel cell engines. He says we’re delighted to partner with the REDC to establish Ballard Rockwell Giga one, which we expect to contribute to the Rockwall tax base and add high quality jobs and rock wall. Okay, so Ballard on the cusp of receiving some monster funds from the DOE and I love the location they’ve chosen for this project, it would seem like Houston would have been a more likely candidate.
But keep in mind that the Texas triangle or the area cornered by Houston, Dallas Fort Worth in Austin, San Antonio, is all considered to be a potential hotbed for both hydrogen development and utilization. And so to choose the northernmost point of the triangle gives them more interior access to North America, while also allowing for quick transfer to the Gulf Coast. And just think for a minute about the scale this announcement is discussing $160 million investment over the next three years to ultimately produce three gigawatts of fuel cell engines a year. That’s amazing. And if they can find offtake for that many fuel cell engines, then we could potentially see a demand side uptick more pronounced than anything previously imagined.
Next, in an article in global data, Eve Thomas writes innovation in green hydrogen driving surge in investment. Innovations in green hydrogen are driving interest in the technology and a surge in venture capital investments. This according to a new briefing. TThe GlobalData briefing notes that India is seeing particularly high levels of activity, with projects valued at $2bn (Rs167.18bn) having received clearance and plans to dedicate up to $12bn in investment in the coming years to green hydrogen production. GlobalData analyst Sourabh Nyalkalkar is quoted as saying: “The year 2024 is shaping up to be a pivotal one for the clean energy sector, with a significant focus on green hydrogen. “This concerted effort by major economies worldwide, coupled with a surge in VC investments in green hydrogen start-ups, sends a clear signal to the energy sector. Stakeholders are encouraged to closely monitor this space for potential growth opportunities.”
There is particular potential for growth in the automotive industry, which has already proved eager to innovate around hydrogen fuel cells. In 2022, BMW chairman Oliver Zipse said: “The next trend will be hydrogen. When it is more scalable, hydrogen will be the hippest thing to drive.” Toyota has already invested heavily in the sector, introducing the first hydrogen-powered production car, the Mirai, in 2014. Pushing back against claims the company is falling behind in the electric vehicle (EV) market, Toyota’s chairman Akio Toyoda said last month that he believed hybrid, hydrogen-fuel cell and hydrogen combustion engines would make up 70% of new car sales globally. His confidence is reflected by Hyundai, which has demonstrated interest in the market for some time, launching its fuel cell over a decade ago in 2013. Since then, it has released its Xcient Hyundai Truck, which takes eight minutes to fuel and can travel 250 miles on a full tank. More recently, in August 2021, it announced a collaboration with Next Hydrogen Corporation to develop an alkaline water electrolysis system.
Volvo is also interested. The company launched CellCentric in 2021, a joint venture with Daimler Truck, to develop hydrogen-powered fuel cell systems with the ambition to become a leading manufacturer. Nyalkalkar comments: “For the energy sector, the innovation landscape in green hydrogen holds immense promise for strategic pivots and growth opportunities. Whether tapping into cutting-edge technologies developed by start-ups or partnering with advanced solution providers, the sector has the potential to rapidly scale markets, especially as global economies open up large-scale production projects.” Considering the technology associated with green hydrogen investment, he identifies photocatalyst electrodes (used in electrolysers that split water for hydrogen) as an area of innovation to watch. By using solar energy to split water molecules, the catalysts produce green hydrogen, offering industries a zero-carbon energy source. Toshiba and Panasonic are named as companies dominating innovation in this sector. However, China is leading in the number of patents processed by SIPO (the State Intellectual Property Office) in the area, with 21%.
“The start-up ecosystem in this field is also gaining competitiveness, with notable players like Ohmium securing a $250m investment led by TPG Capital and Verdagy receiving $73m led by Temasek in late 2023,” adds Nyalkalkar. “Innovation in green hydrogen driving surge in investment” was originally created and published by Just Auto, a GlobalData owned brand. Okay, so no big surprise to see that global investment into green hydrogen, but away this article allies Toyota, BMW and Hyundai to green hydrogen could be a bit misleading. Fuel cells need a high purity of hydrogen to function. But that hydrogen can come from any source, not just electrolyzers. But I would also venture to say that VC interest in hydrogen as a whole is taking off this year, and was covered in great detail at the last ceraweek. Now, if you have the opportunity, I highly recommend taking a listen to the q&a session with Michael LaMotte with Guggenheim discussing the capital transition for the energy transition. I worked with Michael during my time at Guggenheim and he has an absolute wealth of knowledge on the subject.
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.
