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CPH2's CEO Jon Duffy with one of the company's stackable electrolyser modules. Image: CPH2.
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Current± Disruptors: CPH2’s Jon Duffy discusses how green hydrogen will become the benchmark

CPH2's CEO Jon Duffy with one of the company's stackable electrolyser modules. Image: CPH2.

The green hydrogen sector in the UK is gleaning an increasing amount of attention following the publication of the government’s Hydrogen Strategy last year. But how exactly it will fit into the green energy transition, and how it will compete with the more established grey and blue hydrogen technologies, is still up for debate.

One company that is looking to solidify its role in this growing sector is electrolyser manufacturer CPH2. The company, which earlier this month announced its intention to float on the AIM market of the London Stock Exchange to raise approximately £50 million, has developed an IP-protected membrane-free electrolyser.

Current± caught up with CPH2’s CEO Jon Duffy to discuss how the technology works, the growing demand for green hydrogen and the Hydrogen Strategy.

Where did the idea for CPH2’s membrane free electrolyser come from?

Ten years ago, they kind of had a moment where they realised that if electrolysis and green hydrogen were going to grow at the pace they thought it could grow at, you needed a technology that was going to be cheap to produce, had a long life, wasn't going to denude the planet of certain precious materials and would be easy to operate and easy to manufacture.

Up until that point, everybody who made electrolysers saw it as you have a cathode and anode, and you have hydrogen bubbling off one and oxygen bubbling off the other. That gas together, that mix of oxygen and hydrogen, you can't have and therefore you've got to have a membrane. So you shove a membrane in the middle, which are expensive, the PEM ones use platinum group metals, and they just wear out and they tend to have a relatively short lifespan.

The genius of what they did, was saying 'why the hell do we have this membrane that increases cost, decreases efficiency? Why don't we just engineer knowing that we have oxygen, knowing that we have hydrogen as a mixed gas?'

How does it work?

You have a very simple stack, which is just ubiquitous materials, no platinum group metals whatsoever. But you then have to separate the gas still. They introduced a well-known, well established technology: cryogenic separation.

So if you produce this mixed hydrogen and oxygen gas from a very simple stack, dry it so you take off any extra moisture to a very, very low point, and shove it through a cryogenic system, which already exist. And we actually then recover the heat and recover that cold energy to make it incredibly efficient.

Who will be the major offtakers in the near-term?

I think it'll be a combination of all. I think the very early small ones are probably going to go into some sort of heavy duty transport, or running combined heat and power units.

But as we scale up, almost certainly more and more will go into the gas grid. Now, mainland UK has a problem that our gas network, as it is, is not quite ready for it. But if you go to other countries, many places are hydrogen ready and you can put in 20% into networks.

We think that the uses are vast. Some of us are thinking about going to the gas grid, some are thinking of shoving it into transport, some are thinking of putting it into sort of combined heat and power units or whatever else; it's a multitude of different things.

As we get bigger, the biggest offtake will be for big industrial usage. If you're running a cement factory or a glass factory, those businesses are under more and more pressure to increase their green credentials; their ESG criteria at the minute is pretty poor. Those companies, the boards that run those businesses know that, yes they can keep on burning fossil fuels hydrocarbons at the minute, but actually they need to start making changes today. Not in a year's time, not in two years’ time, they need to start planning today.

Can you imagine if you're a cement producer, which at the minute is pretty carbon intensive, isn't it? If you're a cement producer, and you can decarbonise all of your production by using solar and wind into hydrogen, or whatever else, you might have a short term cost, but your long term benefit will be enormous because eventually there will be investment houses that say, 'yeah, we'll invest in new developments, but you know what, we want purely green cement, we want purely green gas'.

How does CPH2’s electrolyser technology compare to grey or blue hydrogen?

The thing with gray and blue hydrogen is that a lot of those technologies are fully depreciated, and so they're not having to run through depreciation within their assets. However, the fact remains that they're producing vast amounts of carbon, and it's that cost of taking the carbon out and storing it that is the true cost. Verses that we compare, absolutely.

In terms then of the cost of producing a kilogram of hydrogen, it all depends on how you calculate it. Ours is a new technology, so therefore the R&D costs have to be considered, but those will soon come down.

Undoubtedly green hydrogen is going to be the benchmark, without a shadow of a doubt. There will be a period of time, as we scale up, that blue and gray has a marketplace. That's just going to happen. But as the price of carbon, and dealing with that carbon, just gets higher and higher there'll be an issue.

I also think there'll be a customer led aspect, where demand says 'hold on a second, why are we just burying something underground- we are not sorting the problem'. And that carbon capture and storage and utilisation is still not proven, and it's hideously expensive.

What was your reaction to the Hydrogen Strategy?

I think the UK government's got their hydrogen strategy slightly wrong. They believe that green hydrogen is not here for a good few years before it's commercially available. Therefore, they've listened to the hydrocarbon lobby, and said we will allow them a certain amount of hydrocarbon based hydrogen prior to green hydrogen going on. If you compare our strategy to somewhere like Germany's or California, where they're going 'no, we're going green hydrogen, and you know what, we will either mandate it or we'll tax out of existence other forms of hydrogen'.

The UK undoubtedly is driving in terms of the knowledge base, the investment and the human capital that we've got within green hydrogen; the UK is a leader without a shadow of a doubt. But there is absolutely a danger that if all we do is keep those businesses here, they’ll keep growing and be world leaders, but actually the technology just goes elsewhere.

So I think it's lovely to have a strategy, it's lovely to have a vision, I think they've just gotten it a little bit wrong. And they should have listened to some of the green hydrogen producers, and realised that actually, we are scaling up in order to produce quite a few megawatts now, we have clear plans to go to 4GW worth of production annually. It'll take a few years, but we're here now, it's operating now.


Molly Lempriere Deputy Editor, Current±

Molly Lempriere is deputy editor at Solar Media, responsible for its UK-facing publications Solar Power Portal and Current±.


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