In the research project H2-Quartiere, the consultancy Steinbeis-Innovationszentrum Energieplus (here abbreviated SIZ E+) is investigating until 2024 how decentralized hydrogen production near to consumers through electrolysis (ELY) can be implemented. On behalf of the German ministry for economy and climate protection, six model districts equipped with ELY systems in urban and suburban areas of Baden-Württemberg will be analyzed and checked to see if there are technical-economic hurdles. The results will be presented in a market analysis for electrolyzers.
This study is based on 23 interviews with operators and manufacturers, with the analysis of the manufacturer market limited to companies that have a branch in Germany. For manufacturers without a branch in Germany, the rapid availability of service personnel in case of repairs or maintenance would be called into question. The results of this market analysis provide an insight into the current situation with regard to investment costs (CapEx), efficiencies and stack temperatures as well as challenges for operators in the distribution of green hydrogen.
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Consideration of the operator side
In Germany, there are currently 13 publicly known electrolysis plants with a power consumption of more than 1 MW in operation (status in 2022, see Fig. 1). Together, these plants have an ELY capacity of around 70 MW. Out of seven interviewed operators of large ELY plants, two complained about the lack of standardization in the stack market. When replacing a stack, it would be advantageous to not be reliant on the same manufacturer that produced the first, it was said. One operator also expressed concern regarding non-European producers when it comes to rapid availability of service technicians in the event of a malfunction.
With regard to the politically envisaged scale-up, five out of seven operators noted that there are not enough customers or demand for green hydrogen to make further investments worthwhile. This is also demonstrated in the ways that green hydrogen has been utilized up to now. So far, six out of 13 large-scale electrolysis plants have fed their hydrogen into the natural gas grid. Only six supply hydrogen to the industrial and one exclusively to the mobility sector. For the benefit of the national economy and the environment, green hydrogen should be used primarily in industrial processes that are otherwise difficult to decarbonize [Agora Energiewende, 2021].
The experience of one plant operator was marked by various challenges. The construction process was delayed in particular due to delivery problems and poor performance by individual construction companies. The putting into operation and the approval process were made disproportionately difficult by additional safety requirements imposed by the responsible regional council. The operation after completion was burdened by sharply rising, volatile electricity prices. Despite these difficulties, the operator is planning to erect another, even larger, ELY plant. The company believes that the long-term ecological and economic potential of green hydrogen will prevail over the medium-term disadvantages.
Consideration of the manufacturer side
The investment costs (CapEx) of hydrogen-producing electrolyzers, regardless of process type, is about 1,000 €/kWel for a large plant. Comparison, however, is sometimes difficult, as not all producers offer the same scope with regard to supportive and auxiliary equipment (balance of power, BoP). The players surveyed are planning expansion with increasingly automated production lines, which could significantly reduce CapEx. For PEM electrolyzers, the share of BoP in the cost lay at 55 percent in 2020 [IRENA, 2020]. Since then, the market volume has increased. However, it can be assumed that here too considerable cost reductions will follow effective scaling.
Figure 2 shows the energy conversion efficiency (LHV to AC = lower H2 heating value to alternating current) of the total of 17 electrolyzers from nine different manufacturers, anonymized and sorted according to electrolysis process. These are alkaline electrolyzers (AEL) in addition to proton-exchange membrane (PEM) and anion-exchange membrane (AEM) electrolyzers. Only makes from manufacturers who are based in Germany and already have customer references are considered. Solid oxide electrolyzers (SOEL), because of the heat demanded by the process to achieve the high operating temperature, are not considered here.
Shown for each electrolysis process are the minimum, mean and maximum values from the manufacturer’s data. Regardless of process type, they vary little between the examined products, with AEL showing slightly higher values. However, the comparability of the manufacturers’ data is a question. Currently, there are no norms or policies to define a standard that indicates under which comparable conditions the efficiency should be determined.
It is striking that some manufacturers state the same system efficiency for makes of different sizes. This indicates that the power consumption of the BoP is only roughly accounted for. In the case of some data, it is unclear whether the specification of the efficiency is a snapshot of the “beginning of life” or an average over the whole lifetime. Furthermore, there is often no information about the load condition at which the efficiency was measured.
Through waste heat recovery, a significant increase in total system efficiency can be achieved. An important factor here is the temperature level of the waste heat source. Figure 3 shows the specifications of nine manufacturers with regard to the stack temperature during operation under nominal load. The stack temperature is the temperature of the cooling medium midway between the inlet and outlet from the stack.
The stack cooling is usually divided into two circuits via a heat exchanger: a primary circuit for direct stack cooling and a secondary glycol circuit for heat dissipation to the environment, for example via package crossflow cooling towers.
Regardless of process type, the difference between the stack entry and exit temperature is usually not significantly more than 10 Kelvin, as higher spans can lead to higher degradation and inhomogeneous load conditions in the stack [TU Delft, 2019]. The primary cooling circuit, because of the special demands on the cooling medium imposed by direct contact with the cells, is usually separated from the glycol circuit via a heat exchanger. For proper hydraulic separation, another heat exchanger may be required in the secondary glycol circuit for waste heat extraction. If a temperature difference of, for example, 10 K is the target, then the return flow temperature from the waste heat utilizer must be between 15 and 20 K below the stack temperatures in Figure 3.
In light of this, all current products, in combination with a peak demand power station via a local heating network, are suitable for supplying an existing or new building area with heating energy. The temperature of most AELs, at an average of 76 °C, is theoretically high enough to enable the supply of hot tap water where appropriate. In practice, however, there are hurdles that can make the use of waste heat difficult. In containerized systems, compact heat exchangers with small transfer surfaces and high temperature differentials are often used, which requires extremely low entry temperatures on the part of the cooling medium. When using a heat pump, this entry temperature is decisive for the evaporating temperature of the refrigerant. To ensure a high efficiency, or rather coefficient of performance, of the heat pump, larger heat exchangers and higher entry temperatures are advantageous.
The principle of waste heat utilization for heat supply had already been implemented by SIZ E+ in the climate-neutral city quarter (Klimaquartier) established in Esslingen am Neckar in the state of Baden-Württemberg (see H2-international May 2021). The project is based on the idea of a climate-neutral quarter with the lowest possible carbon footprint. The heart of the energy supply is an AEL plant with an ELY capacity of 1 MW, which receives surplus electricity from local photovoltaic systems as well as from other regions. The ELY waste heat at the same time serves as an energy source for a heat pump. The project follows the innovative approach of power-to-gas-and-heat, in which hydrogen is to be produced close to the consumer on a local level at sensible nodes.
In the new project H2-Quartiere, the potential implementation of this approach in six other model neighborhoods is being explored. Through the use of waste heat in the conversion process and through the short transport routes to the end users, this system approach is potentially extremely efficient and offers highly synergistic effects to the much needed clean heating and energy transition. According to the 2021 study by the German real estate association ZIA, around 20 percent of the heating demand in the buildings sector could be covered by ELY in year 2045 if half of the German hydrogen demand is produced by local ELY plants within Germany [ZIA, 2021].
Tiktak, W. J. (2019), “Heat Management of PEM Electrolysis,” TU Delft Master Thesis, p. 19, http://resolver.tudelft.nl/uuid:c046820a-72bc-4f05-b72d-e60a3ecb8c89
Flis, G. et al. (2021), “12 Insights on Hydrogen,” Agora Energiewende, p. 16, https://static.agora-energiewende.de/fileadmin/Projekte/2021/2021_11_H2_Insights/A-EW_245_H2_Insights_WEB.pdf
Fisch, M. N., Lennerts, K. et. al (2021), “Verantwortung übernehmen. Der Gebäudebereich auf dem Weg zur Klimaneutralität,” ZIA Zentraler Immobilien Ausschuss, pp. 144-145, https://zia-deutschland.de/wp-content/uploads/2021/12/Verantwortung-uebernehmen-Gutachten.pdf
IRENA (2020), “Green Hydrogen Cost Reduction: Scaling up Electrolysers to Meet the 1.5⁰C Climate Goal,” International Renewable Energy Agency, Abu Dhabi, p. 52, https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2020/Dec/IRENA_Green_hydrogen_cost_2020.pdf?rev=4ce868aa69b54674a789f990e85a3f00
Authors: Prof. Dr. M. Norbert Fisch Dr. Christian Kley Benjamin Trippe benjamin.trippe@siz-energieplus.de Simon Marx All from Steinbeis-Innovationszentrum Energieplus, Braunschweig
Image: Current commercially operated electrolysis plants in Germany
It’s now become apparent to most market observers that the energy supply in Germany and Europe is going to fundamentally change. Instead of fossil fuels it’ll be up to renewable energy sources to keep the economy and society moving.
Given what we know today, hydrogen will be paramount to this transformation process since there’s no way of linking up the various parts of the energy ecosystem without recourse to hydrogen gas.
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The underlying conditions that make this possible have already been put in place: Both the German government and the European Parliament have made clear their support for a hydrogen economy. For months now, other national hydrogen strategies have been popping up around the world – surely evidence that the hydrogen industry will be on a global scale. The announcement of the Inflation Reduction Act by the Biden administration in the US made it abundantly clear, if it wasn’t already, that hydrogen is the fuel of the future.
Despite current developments speaking for themselves, many industry players are still hesitant when it comes to making concrete investment commitments. And at the numerous trade fairs and congresses in the fall, the overwhelming majority of attendees were heard grumbling about the government, complaining that it hadn’t created suitable safety nets.
High-ranking company execs are calling for more regulation on this and that. Sometimes the criticism is directed at the approvals procedures, other times it’s EU legislation or local stipulations. The reasons given as to why a decision can’t be made right now are many and varied, but most of them are used as excuses for doing nothing.
Yet all those who are just talking while sitting on their hands, need to ask themselves what they are really waiting for. For state guarantees that ensure the maximizing of profits whatever happens? For binding assurances that safeguard the company’s survival for the next 20 years?
At the H2Expo in Hamburg, for example, one manufacturer of stationary hydrogen engines said: “We can bring out 1 gigawatt, but there isn’t the demand.” Elsewhere a representative from the gas industry boasted: “Hydrogen could flow through our pipes if it were there.”
Needless to say, we still don’t have sufficiently affordable green hydrogen yet, which explains why hydrogen engines, for want of a viable business model, are still not in demand and pipelines continue to carry only fossil gas.
And yes, the electricity market does need overhauling to create more planning certainty. And the shortage in chips and skilled personnel does need addressing. But this reputedly unclear legal situation and the lack of renewables capacity mustn’t be used as justification for failing to act right now.
If some people really want to wait for others to solve the challenges we are facing, then they are welcome to do so. Whoever holds off until all issues have been settled between natural gas and hydrogen network operators and the chips are pouring in again, will have months, if not years, to twiddle their thumbs. However, the cake may well have been polished off by then.
Of course, much work still has to be done at a policy and regulatory level – and quickly. The impact that policy can have is now plain to see. Emissions limits or other environmental rules have been introduced in every imaginable branch of industry, be it for the automotive sector, for cement producers or for wind farm operators – and successfully so. The latter are required to reduce their own energy consumption annually by 5 percent (see p. 44).
There are times when the government is able to act relatively quickly if it wants or needs to – something we can see at the moment with LNG terminals on the German coast. But what’s the point of having ostensibly hydrogen-ready terminals if they don’t get any green hydrogen because those with the cash and the know-how don’t get their act together, don’t get involved in renewables expansion or building up production capacities for electrolyzers, fuel cells or hydrogen engines?
You’ll often hear people citing a “new German swiftness,” but this is usually when asking others to move at a faster pace rather than to gauge their own actions. It’s fascinating to listen to large companies and corporate groups in particular gladly pointing the finger of blame at politicians and demanding they set up “appropriate framework conditions” without themselves putting in the prep work.
So here’s a heads-up: Anyone who genuinely believes that, in times like these, they can palm off all risk to the German government or the taxpayer, is in very real danger of becoming a bystander. Those who avoid taking responsibility today for their own company and/or employees, could soon bitterly regret their lack of action.
And that would be a crying shame because – after 50 years of delays and disputes – we can’t afford to waste any more time in bringing about social and environmental change and meeting our climate goals so that ultimately the planet can remain a habitable place.
US transport company Uber is currently setting up a fleet of up to 200 hydrogen cars in Berlin. The first automobiles have been giving rides in the German capital since fall 2022, though the Toyota Mirai 2 vehicles were provided not by Uber but by the SafeDriver Group, which is the prime contractor for Germany. The goal of SafeDriver owner Thomas Mohnke is to enable sustainable mobility before cities ban the entry of diesel vehicles to downtown areas.
Mohnke, who has been in the limousine business for 45 years, told H2-international that Uber doesn’t have any of its own vehicles; it merely brings drivers and cars together for the purposes of passenger transportation. “My role is to make recommendations rather than to instruct our subcontractors,” explained the SafeDriver owner. He continued, saying that he has his own fleet of 150 vehicles, 40 of which are hydrogen cars.
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Mohnke fully backs hydrogen as battery electric operation is “not really ideal” for shift work. In his opinion, fuel cell cars are “excellent,” especially because of their short refueling times. He revealed that for early 2023 a separate ordering function will be integrated into the Uber app that will enable customers to explicitly request a hydrogen car.
An interesting approach to furthering hydrogen education and the sharing of ideas is being taken by the startup Hyfindr. During the Hydrogen Technology Expo Europe in Bremen (see p. 9) mid-October 2022, the young company presented its new concept publicly for the first time: an internet platform with the goal of using the expertise of professionals from the hydrogen and fuel cell industry by setting out targeted technical questions that could – so the hope is – be answered by experienced people. At a time when Xing is in the process of closing its discussion groups, Tech Community could become a fresh forum that focuses less on quantity and more on quality. H2-international spoke about it with the two founders, Dr. Björn Lüssow and Steven Oji.
Hello Björn, hello Steven, you have just presented in Bremen your new expert forum Hyfindr Tech Community for the first time. How was the response?
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Björn: Very inspiring, Sven. Almost all of the people that we introduced the Hyfindr Tech Community to were immediately excited about it and signed up right after the trade fair. It is evident to every professional in the hydrogen industry that the development and implementation of projects is accompanied by numerous technical challenges. Our Tech Community makes it possible to resolve technical questions quickly and efficiently. I was particularly pleased with the positive feedback I received from students and young professionals; there is a huge demand for knowledge. Many want to work in the hydrogen industry and need digital tools to educate themselves. This is where we come in.
Before, you had only been granting access to the new platform to a small circle of people. Why the initial hesitance?
Steven: Every community lives on the engagement of its members. Only when members of a community are also engaging, which means in our case also really helping with technical questions, are others inspired to join in. No one wants to be a member of a “dead community.” For this reason, we started small, with a few highly motivated professionals that we already knew or suspected would help us. We first invited these people to a beta testing and then asked for feedback. We knew that not everything would be immediately optimal in the beginning.
Among other things, you offered online workshops in advance, where the various functions were explained to the initial participants. What was the feedback?
Björn: That’s right. And from this we also received reassurance. We held several video meetings with up to ten participants to personally present the goals of our initiative. Doing this was important to me for another reason: only in personal exchange can we really get a feeling for whether an initiative has usefulness or if we are making presumptions. Luckily, the feedback was – as already stated – very positive. We now have several hundred members already, who are diligently discussing technical topics.
I see. So please briefly explain exactly what you have actually built and now offer.
Björn: Gladly. Online communities are not just private test projects or hobbies these days; they now also have great relevance for professionals in many industries. The best example of this, in my opinion, is Stack Overflow. In this forum, hundreds of thousands of software developers freely help each other with programming problems every day. You can find there more than 23 million questions and answers, and the community is visited over 100 million times every month. The more high-quality content a member contributes, the clearer their expertise becomes in their profile. Software developers are now applying for jobs with the authority they’ve earned in the Stack Overflow community, and no longer with just CVs. I am very impressed by this community, and I asked myself why there was no comparable community for the hydrogen industry, as there are currently many questions to be answered in the hydrogen industry around the world as well.
What distinguishes your concept from Xing, LinkedIn or other forums?
Steven: LinkedIn and Xing are primarily marketing channels and platforms to establish business contacts. On LinkedIn, people don’t ask technical questions. Or have you ever seen a question there like “Does every fuel cell stack really need a humidifier?” The following difference is also interesting. Groups, for example on LinkedIn, that were started for idea exchange mutate once they get bigger and bigger into a pure newsfeed. This reduces the benefit for the individual group member. No one can read all the new project updates on LinkedIn anymore. With a Q&A forum like the Hyfindr Tech Community, it is different, because the value for the individual member increases the larger the community becomes. With a large number of members, the probability of finding an expert or two for a specific question is higher. One person asks a question and the intelligence of the entire community answers. In a community like Stack Overflow, it is also often the case that someone has already had the same problem and can therefore let good answers to the similar problem be found. That is efficient, and that’s where we want to go with the Hyfindr Tech Community. It would therefore be great, Sven, if many of your readers registered as members and participated (community.hyfindr.com).
You two have been active in the hydrogen industry for a long time, but an internet platform is completely new ground for you, right? Björn, what did you do before this?
Björn: I worked at Mercedes for nearly twenty years. As a lawyer, I helped arrange small, and also very large, partnerships and M&A transactions over the course of more than ten years. I got my connection to the hydrogen industry in 2013, when I got to support in establishing the joint venture H2 Mobility. I figured at the time that hydrogen was our chance to get out of oil. An entrepreneur was what I’d always wanted to be. That’s why I initially studied business and earned the Diplom-Kaufmann degree before studying law. When I started my studies, I was actually much more interested in economics than law. Even though I have no training as a software programmer, I can assure you that I am truly immersed in the IT world from my independent study during the last three years in preparation for Hyfindr.
And you, Steven?
Steven: I represent more of the technical side of Hyfindr. Like most of our employees, I’m a passionate engineer. Like Björn, I worked for Mercedes-Benz for several years, where last I was developing FC systems. I did that afterwards in another company as well, before I devoted myself completely to the establishing of Hyfindr and everything associated with that. For many years of my life, for professional or private reasons, I lived in countries where energy supply via diesel was a necessary given. Already in my childhood years, I wanted to change this in some way, because it generates a lot of noise and pollution. It already disturbed me back then.
You then found Hyfindr together, which is already off to a pretty good start. Please briefly explain what exactly Hyfindr is.
Steven: Hyfindr.com is the rapidly growing B2B marketplace for the global H2 industry on which you can find many components, systems and services that are now needed to build this industry. We place particular value in that engineers especially can find all information relevant to the industry directly on the site. I had these problems myself when I was developing fuel cell systems. And it is still very difficult to find the right components. Here is where Hyfindr comes in handy. Products can be compared on the basis of technical criteria with just a few clicks, and price quotes can be efficiently requested from suppliers. This reduces negotiation costs for both the buyer and seller. Unlike a trade fair, Hyfindr.com runs 24/7, 365 days a year. Industry professionals visit us when they have a specific need. We like to point out to sellers of these products, “We drive in customer interest while you sleep!”
This new platform, Tech Community, is now only one of several mainstays of Hyfindr, right?
Björn: It’s true that we have developed several formats, but our B2B marketplace is at the core of our business model. Hyfindr Tech Community is not meant for economic advancement. With this, we want to contribute to making it easy for young professionals in particular to join the H2 industry. For this reason, marketing posts are also forbidden in our Community. It’s about helping each other solve technical issues. In our Hyfindr Knowledge Hub, there are already more than 30 neutral articles that convey the technical basics. Here, professionals can find out what they need to know before buying hydrogen tanks, filters or compressors. This collection of knowledge too we are continuing to expand, and it’s available free of charge on hyfindr.com.
How is the marketplace there developing so far?
Steven: The development is incredible. We launched it in September 2021, and since then we have been growing on average between 10 to 15 percent every month. In the meantime, more than 100 well-known brands have listed their products and services. Thousands of users visit us every week, who look at several pages. From this enormous amount of traffic, we also generate week after week numerous high-quality leads for the companies. So far, we have not unlocked, as I see it, even ten percent of the potential of Hyfindr, as we still have to become better known. The development, however, is pointing steeply upwards. Since June 2022, we have also been supported by no less a company than Google. We are one of very few companies in Germany to be included in the international program “Google for Startups.” This helps us a lot.
Compared to the earlier hype around hydrogen, what is different today from your point of view?
Björn: This time, I think it is a sustained development, as it’s not only prototypes or demonstration projects, but strategic investments being made worldwide. In some countries, the fuel cell industry is even scaling up already. However, the actual effects will only become apparent in the next few years, with sector coupling. I am firmly convinced that all doubts whether the hydrogen industry can develop into an economic sector similar to the oil and gas industry will fade within this decade.
Steven: With that, I can only agree. And as an engineer, I would like to add the following. The clean energy transition requires new technical solutions. With battery technology alone, we won’t be able to build all the solutions we need to become greener. Hydrogen and fuel cell technology are not the only, but a very important, building block of the energy transition. I’ve lived in South Africa and Nigeria next to chugging diesel generators that ran air conditioners and produced electricity for lanterns. We can’t go on like this as a planet. So I have a personal motivation as well to contribute with Hyfindr to making the growth of the global hydrogen industry faster and better. This mission drives me and also Björn.
Where do you see your marketplace and Tech Community in five years?
Steven: You could say that we have set out to become the Amazon of the hydrogen industry. With Hyfindr.com, we are building a digital supply chain for the global hydrogen industry so that it can grow faster. Professionals should be able to rely on Hyfindr as a place to find all the relevant products available. Everything starts very small, with one or two people who have an idea and pursue it consistently. That’s what we’re doing with Hyfindr.
Björn: With our Tech Community, we want to become the Stack Overflow of the hydrogen industry. I promise to tell you when we’ve reached a hundred thousand questions and answers in Hyfindr Tech Community, Sven. Once we do this, we will have significantly accelerated the hydrogen economy. It’s inconceivable to build a new industry, like the hydrogen industry, only with the tools from yesterday. Hyfindr wants to offer digital tools to promote the growth of this industry on a global scale. That’s what I work for.
For many years Swedish company myFC repeatedly made headlines with its specialist fuel cell applications – ranging from fuel cell systems for cell phones to electrically powered bicycles. In fall 2022 the disclosure was made that the company, which has been listed on the Nasdaq First North Growth Market since 2014, had filed for insolvency at the district court in Stockholm on June 30. Trading platforms indicated a liquidity squeeze as the cause.
The Scandinavian company had previously presented test models of an initial user-friendly portable charging device back in 2008 (see HZwei, April 2011). In 2011 it introduced Powertrekk, a hybrid device consisting of a PEM fuel cell and a lithium-ion battery for supplying power to mobile terminals. The Powertrekk 2.0 came “onto the market” in 2015 but failed to make a profit.
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