IPO Corner: Green Hydrogen Fuels To The Rescue?

Green hydrogen has been increasingly in the limelight as a potential savior in the energy crisis, and the outlook of the market is good as the cost of producing hydrogen from renewables is set to become cheaper (by some 30%) and the space is projected to generate $140 billion annually by the end of the decade. The problem is, it’s complicated… because as of right now, almost all hydrogen is created from fossil fuels.

Currently, about 99% of hydrogen is produced from coal and natural gas. When hydrogen is extracted, energy is generated through a chemical reaction with oxygen. This is done with Hydrogen Fuel Cells (HFC) that convert the hydrogen into energy. This energy can be used for all sorts of things, including powering cars and buildings, and the reaction doesn’t create any pollution, only water. As you can see, this is why hydrogen can be touted as “clean” energy… but you can also see that, since it’s derived from dirty processes, that’s only if we are splitting hairs.

Let’s take extraction from natural gas, for example. With this extraction process, natural gas is blasted with steam at more than 700 degrees Celsius (known as steam methane reforming), and steam methane reforming creates a lot of carbon dioxide, not to mention it’s every bit as energy intensive as it sounds. So, hydrogen fuel combustion is clean, but the process of extracting the hydrogen is dirty. And here’s the rub… is there a future in which a truly green hydrogen can it save us from our dirty energy habits?

The Race To “Green”

If we can work out certain problems, such as the high cost of production and difficulties in transporting it, hydrogen is extremely powerful, powerful enough that it is used as rocket fuel. In fact, it’s three times as powerful as gasoline and other fossil fuels. And it’s extremely efficient, as it delivers more energy per pound of fuel.

Companies are racing one another to figure out ways to truly create green hydrogen, and to do so cheaply and at scale. As you can imagine, being first to market with this type of thing could be incredibly valuable. A few current possibilities are using wind turbines and solar panels. One such method involves running an electric current generated by wind turbines or solar panels through water using an instrument called an electrolyzer to split the hydrogen from water.

Another possibility is biological waste, and some companies are experimenting with it right now, including Modern Electron and H2-Industries. Modern Electron is looking to turn cow manure into clean-burning hydrogen and H2-Industries wants to utilize waste and solar to produce green hydrogen.

Modern Electron is a startup based in the Seattle area that has partnered with the Tulalip Tribes, local dairy, and environmentalist efforts to first turn cow manure into natural gas, then convert it into hydrogen fuel and carbon that can be applied as fertilizer. H2-Industries is planning to develop a $1.4 billion waste-to-hydrogen plant and solar farm power plant in the Sultanate of Oman that will initially convert up to one million tons of municipal solid waste each year and ramp up to as much as four million tons.

Hydrogen Debuts Ahead

There are a few companies working on the difficulties posed by the problem of truly green hydrogen that are poised for an IPO, Titan Hydrogen and ThyssenKrupp Nucera, that hold promise and we’re keeping tabs on what they’re up to.

Titan Hydrogen is a fuel cell enhancement technology company which creates a low temperature, high-performance hydrogen fuel cell designed to convert old vehicles to modern hydrogen hybrid engines. The company, headquartered in Sydney, New South Wales, has people excited over their hydrogen fuel cells because they promise to pack a punch compared to standard Polymer Electrolyte Membrane (PEM) fuel cells. This is important because PEM fuel cells, used to power electric automobiles, only convert around 40% of supplied H2 energy to usable electricity.

If Titan Hydrogen gets this right, and it looks like they might, the boost to fuel capacity from their technology will be as much as 60%… that means automobiles could go much further because they’ll be converting more energy to electricity. That could make waves in this space. If their fuel cell produces a much higher voltage than standard PEM fuel cells, more people may be willing to make the switch to electric because vehicles could go much further than they do now before needing a charge. This could mean wider adoption, and the impacts will ripple outward. The company is possibly looking to IPO sometime this quarter.

Also eyeing a possible IPO is German industrial conglomerate ThyssenKrupp of its majority-owned hydrogen electrolyzer subsidiary, ThyssenKrupp Nucera. Nucera is the world’s top supplier of chlor-alkali membrane technologies necessary to produce hydrogen. The company’s electrolysis technology uses power to split water into oxygen and hydrogen, which allows CO2 heavy sectors to decarbonize. Nucera is also active in alkaline water electrolysis, which is an important requirement for the generation of hydrogen produced via renewable energy.

The company is looking to grow with the green hydrogen movement, and they have been studying the numbers. They estimate that the global hydrogen market will see demand rise sevenfold by 2050 and that, by that time, anywhere from 60% to 80% of that hydrogen will be “green”… they want a piece of that action. They are aiming for proceeds of as much as $687 million through an IPO which could happen sometime this spring or summer, but a firm decision still needs to be made.

Once engineers figure out how to execute a true “green” hydrogen affordably at scale, this will set off a domino effect in a space hungry for a spark to ignite the powder keg of possibilities sitting within it. Can we meet our ambitious goals for clean hydrogen that utilizes what we already have, or will we continue to plunge the earth for dirty fuels to create hydrogen? With these spectacular companies on the case, it’s looking like we just might be able to make serious progress. Stick with us for future issues, we’ll keep you in the know about how green hydrogen is shaping up, and you’ll be the first to know should any of these exciting companies end up on my Buy List.