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The Journey to Green Hydrogen with Startups: Paving the Way for a Sustainable Future



Introduction In the pursuit of a more sustainable future, green hydrogen has emerged as a promising energy carrier. As the world transitions away from fossil fuels, the production of hydrogen using renewable energy sources has gained significant attention. In this blog post, I’ll explain the evolution from gray to blue to green hydrogen, and delve into why green hydrogen is crucial. Then, we’ll look into the huge potential and massive growth of the green hydrogen market, its applications across various industries, and some cutting edge green hydrogen startups building the future today. Let’s jump in! The Evolution of Hydrogen: Gray, Blue, and Green Hydrogen has a long history, dating back to the early 20th century when companies began using it for various industrial applications. Today, we are transitioning from gray hydrogen to blue and green. Let’s explain what each one means - before going deeper into green hydrogen specificaly.

  • Gray Hydrogen: Gray hydrogen refers to hydrogen produced from natural gas through a process called steam methane reforming (SMR). This is currently the most common method of hydrogen production, accounting for the majority of global hydrogen output. However, gray hydrogen has a significant environmental drawback as it releases carbon dioxide (CO2) into the atmosphere, contributing to climate change.

  • Blue Hydrogen: Blue hydrogen is an intermediate step towards a greener future. It is produced using the same process as gray hydrogen, but with an additional step called carbon capture and storage (CCS). CCS captures and stores the CO2 emissions generated during the production process, effectively reducing the carbon footprint. Although blue hydrogen reduces emissions compared to gray hydrogen, it still relies on fossil fuels.

  • Green Hydrogen: Green hydrogen represents the pinnacle of sustainable hydrogen production. It is produced using electrolysis or photocatalytic water splitting. Electrolysis is where water is split into hydrogen and oxygen using electricity derived from renewable sources such as solar, wind, or hydroelectric power. Photocatalytic water splitting is a process that uses sunlight for the dissociation of water (H2O) into hydrogen (H2) and oxygen (O2). Green hydrogen produces zero greenhouse gas emissions and holds immense potential to decarbonize multiple sectors of the economy.

The Need for Green Hydrogen The urgent need for green hydrogen stems from its potential to address critical challenges in the transition to a low-carbon economy:

  1. Decarbonization: Green hydrogen offers a pathway to decarbonize industries that are difficult to electrify directly, such as heavy transport, industrial processes, and energy storage. By replacing fossil fuels with green hydrogen, we can significantly reduce greenhouse gas emissions and combat climate change.

  2. Energy Storage: Green hydrogen can serve as a reliable and scalable form of energy storage. Excess renewable energy generated during periods of low demand can be used to produce hydrogen, which can later be converted back into electricity during peak demand periods. This storage capability helps balance intermittent renewable energy sources and enhances grid stability.

  3. Energy Independence: Green hydrogen production can promote energy independence by reducing reliance on imported fossil fuels. Countries with abundant renewable energy resources can harness green hydrogen to meet their energy needs while reducing dependence on external energy sources.

Market Size and Industry Applications The market for green hydrogen is rapidly growing, driven by ambitious climate targets and the increasing adoption of renewable energy sources. According to a report by the Hydrogen Council, the global demand for hydrogen could increase 10-fold by 2050, reaching 500 million to 800 million metric tons per year. In monetary terms, the global green hydrogen market was worth $4B in 2022 and is forecast to reach $332B by 2032 - a stunning 55% CAGR. Industries across sectors are recognizing the potential of green hydrogen and incorporating it into their operations:

  • Transportation: Green hydrogen can power fuel cell electric vehicles (FCEVs), offering longer ranges and quicker refueling compared to battery electric vehicles. Additionally, it can be used for shipping, aviation, and heavy-duty vehicles, where electrification may be challenging.

  • Industry: Various industrial sectors, including steel, chemicals, cement, and refining, can utilize green hydrogen as a feedstock or as a direct replacement for fossil fuels in their production processes. This enables them to significantly reduce their carbon footprint.

  • Power Generation: Green hydrogen can be used in gas turbines to generate electricity, acting as a backup during renewable energy shortages. It can also support grid stability through load balancing and enable the production of green synthetic fuels.

Startup Solutions: Entrepreneurs around the world are working on innovative solutions for green hydrogen and catalyzing the green revolution. At Axis Innovation, we’ve been scouting in this space for the past two years, and identified dozens of companies. Here are some examples of startups from around the world with cutting edge solutions:

  • Enapter (Germany): Enapter is focused on producing modular electrolysers for green hydrogen generation. Their compact and scalable electrolysers are based on anion exchange membrane (AEM) technology, enabling efficient and cost-effective hydrogen production.

  • Joi Scientific (United States): Joi Scientific has developed a proprietary technology called Hydrogen 2.0 that produces green hydrogen through a low-energy water dissociation process. Their technology aims to make green hydrogen production economically competitive and accessible.

  • Everfuel (Denmark): Everfuel is working on building an infrastructure for green hydrogen production, storage, and distribution. They focus on providing green hydrogen as a zero-emission fuel for the transportation sector, with an emphasis on heavy-duty and long-range applications.

Israeli Green Hydrogen Solutions: The Israeli government, research institutions, and industry stakeholders are working together to create an ecosystem that supports the growth of green hydrogen. With a clear strategy and investments in technology and infrastructure, Israel is well-positioned to become a significant technology player in the global green hydrogen market. At Axis Innovation, we’ve identified over a dozen green hydrogen startups and are closely monitoring the space with our partners in the ecosystem and in academia. Several companies have already been making significant progress and are at the forefront of developing innovative technologies for green hydrogen production:

  • H2Pro: H2Pro is an Israeli startup that has developed an innovative water-splitting technology to produce green hydrogen. Their technology utilizes a low-cost catalyst and operates at higher efficiencies, making it more commercially viable for large-scale hydrogen production. Earlier this year in March 2023, they announced a deal to sell hydrogen to Japanese giant Sumitomo in deal estimated at $250 million.

  • QD Sol: QD-SOL develops technology that uses sunlight as a renewable source of energy to split water for the purpose of green hydrogen generation. Unlike many current water-splitting methods, which are energetically unfavorable and contaminating, QD-SOLs technology efficiently uses the unlimited resource of sunlight to yield a clean splitting process. In May 2023, QD Sol won the Aviram foundation startup competition in Morroco as most innovative start fighting climate change.

​​ When will green hydrogen reach mass market production? The transition from blue to green hydrogen is already underway, with numerous projects and pilot plants being developed worldwide. The rate of adoption will depend on factors such as the cost of renewable energy, advancements in electrolyzer technology, and supportive policies and regulations. Experts predict that green hydrogen will become commercially viable and widely available within the next decade. As renewable energy costs continue to decline and electrolyzer technologies become more efficient, the production costs of green hydrogen are expected to become competitive with gray and blue hydrogen. Conclusion Green hydrogen represents a crucial stepping stone towards a sustainable energy future. Today, timing is ripe for innovation - as corporations are in need of green hydrogen solutions, ready to partner and invest, and more and ore startups are developing new cutting edge technologies. We expect to see more green hydrogen startups created over the next few years, investments to dramatically increase, and major partnerships announced. The market continues to grow and this technology holds immense potential to accelerate the decarbonization of our economy. It is an exciting time in energy transition with green hydrogen - and we can look forward to a world powered by clean and renewable energy, where green hydrogen plays a central role. Jason Weiss, COO & Dealflow Manager @Axis Innovation


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