Electrolysers

'World's largest' | Topsoe plans 5GW solid-oxide hydrogen electrolyser factory as it signs off first 500MW

Market focus is shifting towards US away from hesitant EU says Danish firm, as it calls for more certainty on European fiscal regime

Topsoe SOEC electrolyser factory, Herning Denmark.
Topsoe SOEC electrolyser factory, Herning Denmark.Topsoe
  • Rachel Parkes

Danish green technology firm Topsoe has taken final investment decision (FID) on a 500MW factory to manufacture hydrogen-producing solid oxide electrolysers (SOEs), the largest confirmed plant making this technology in the world to date.

Construction will begin onsite in Herning, central Denmark later this year, with the plant expected to be on line by 2025, Recharge understands. The Dkr2bn ($270m) price tag accounts for the largest investment in Topsoe’s 80-year history.

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Tentative plans to expand capacity could see the factory scaled up to a whopping 5GW in future, which if realised would put it on a par with the largest confirmed electrolyser manufacturing announcements made so far, by the UK’s ITM and Germany’s Thyssenkrupp.

This decision would depend on Topsoe’s learning from operating the 500MW plant, as well as on market demand and policy signals, chief commercial officer of the company’s Power-to-X division, Sundus Cordelia Ramli, tells Recharge.
“While Denmark and the EU are currently working on incentives and regulatory frameworks to drive the green hydrogen market with REPowerEU, there is still a lot to be done,” she says.
But policy developments in the US, including the passage through Congress of the Inflation Reduction Act (IRA), which introduced a $3/kg maximum tax credit for green hydrogen producers, could dramatically change the game, she adds.

If market signals align, Topsoe could make a decision as early as 2023 or 2024 resulting a 5GW plant on the ground before 2030, Ramli explained.

Sundus Cordelia Ramli, chief commercial officer, power-to-X division, Topsoe.Topsoe

Emerging US dominance

SOEs use heat and power to split water molecules into hydrogen and oxygen at temperatures of over 1000°C. While this means that they require less electricity than alkaline or proton exchange membrane (PEM) electrolysers to produce the same amount of hydrogen, they also need an external heat source and therefore operate most efficiently when using waste heat from other industrial processes, such as ammonia or methanol production.

Topsoe has already sold 500MW of capacity at the plant — a year’s worth of production — almost half of which has been sold to projects based in the EU, but the rest are not project specific.

“It really depends on the EU subsidy schemes coming into play,” Ramli tells Recharge. “The [order] pipeline might shift to the US, purely due to the introduction of the IRA. We are seeing a shift of what could be 100% focus on the EU, moving into another market.”

Topsoe chief executive Roeland Baan today called on European politicians to step in with financial support for the continent’s industry.

“It is a reality that industry cannot lead this energy transition alone,” Baan said. “We look towards the EU and the Danish government for long-term incentives and supportive framework conditions to continue to accelerate the green hydrogen market and anchor large-scale electrolyser production right here in the EU.”

Growing capacity

There has been considerable anxiety about the ability of electrolyser manufacturers to meet skyrocketing demand from prospective green hydrogen producers, but gigafactory investments and plans are now rolling in.
Norway’s Nel recently announced an expansion to its alkaline electrolyser production in Herøya, Norway to 1GW and ITM plans to achieve 5GW of alkaline electrolyser manufacturing capacity by 2024.
US-based Cummins is also planning to build a 500MW plant manufacturing PEM electrolysers in Spain, in partnership with Iberdrola, which could be up and running by 2023, and scalable to 1GW.

“The case for using electrolysis to produce green fuels is now well established, but manufacturing capacity has always been the challenge,” said Baan. “We are investing to meet this demand and address this fundamental supply weakness.”

There are now 14 gigawatt-scale electrolyser factories announced globally to date, adding up to a total of 26GW.

(Copyright)
solid oxide electrolysers (SOEC)Hydrogen electrolysersTopsoeEuropeUSA
Published 3 October 2022, 16:16Updated 3 October 2022, 16:16