## Topsoe confirms FID to build world’s largest SOEC electrolyzer plant; company’s biggest single investment

##### 02 September 2022

The Board of Topsoe has made the final investment decision (FID) to begin construction of the world’s largest SOEC electrolyzer manufacturing plant in Herning, Denmark. Plant manufacturing capacity is 500 MW per year with an option to expand to 5 GW.

Rendering of SOEC electrolyzer plant.

SOEC technology consumes less electricity than alkaline and PEM technologies, as the process requires less power overall; with the integration of a steam feed, the SOEC process becomes even more efficient.

The case for using electrolysis to produce green fuels is now well established, but manufacturing capacity has always been the challenge. We are facing this challenge head on. We are dedicated to taking the lead on scaling power-to-x technology to help drive the energy transition, and we are investing over DKK 2 billion [US$267 million] to meet this demand and address this fundamental supply weakness. This is the single biggest investment in the company’s history, clearly highlighting our commitment to driving the energy transition, and we hope this huge facility will act as a catalyst for new investment in the future. —Roeland Baan, Topsoe CEO Sundus Cordelia Ramli, CCO of Topsoe’s Power-to-X division, said that Topsoe already has 500 MW of pre-sold capacity and is in discussions with other potential offtake partners as well. At 500 MW capacity per year, the new facility will be the world’s largest SOEC manufacturing plant. This is a rapid acceleration not just for Topsoe, but also Denmark. Topsoe is also delivering on its REPowerEU ambitions when, in May 2022, a Joint Declaration was signed along with other industry leaders and the European Commission to commit to a tenfold increase of European electrolyzer manufacturing capacity by 2025. This is a major statement of intent from Topsoe, but it is also a reality that industry cannot lead this energy transition alone. 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 electrolyzer production right here in the EU. —Roeland Baan ### Comments They get stonking efficiency: https://blog.topsoe.com/haldor-topsoe-to-build-large-scale-soec-electrolyzer-manufacturing-facility-to-meet-customer-needs-for-green-hydrogen-production ' With efficiencies above 90%, Topsoe’s proprietary SOEC electrolyzers offer superior performance in electrolysis of water into hydrogen, when compared to today’s standard alkaline or PEM electrolyzers.' It will be interesting to see who is prepared to re-evaluate their position on hydrogen production in the light of one of its main criticisms being answered, and who simply goes to: 'And another thing' argumentation to avoid re-assessment. The economics for Topsoe Haldor of their technology should significantly improve if and when they are able to integrate this MIT work on making them last longer: https://www.greencarcongress.com/2022/09/20220901-mit.html It should be noted that with the energy crisis in Europe, renewable hydrogen is cheaper than using natural gas, before the latest advances are taken into account: ' in March this year, BNEF performed a new analysis that concluded that green hydrogen was now cheaper to produce than blue and grey H2 in Europe, the Middle East, and China due to high fossil-gas prices.' https://globuc.com/news/green-hydrogen-imports-will-be-cheaper-than-locally-produced-h2-in-europe-from-2024-study/ It is now possible to provide a reasonable outline for very low to zero carbon energy. All sorts of assumptions have been made in an attempt to show that hydrogen is massively inefficient. These rely on assuming that the energy is going back and forth to electricity with consequent losses, as well as making invariably worst case assumptions. So lets look at this set up for efficiencies throughout the chain. Topsoe Haldor hits 90% efficiency in this SOEC for electricity- hydrogen. The efficiency thereafter is dependent on how it is distributed, and then whether you can use the thermal heat as well as the electrical output. Looking at that first, home fuel cells in electrical plus thermal efficiency hit 90% plus too: https://www.researchgate.net/publication/270968098_Hydrogen_and_fuel_cell_technologies_for_heating_A_review On page 4 it is given as up to 95% So that leaves distribution. There are losses in compression, and most definitely in liquifaction. Many raise leakage as a concern. I read$270.000.000 for the 500 MW plant, or ~$500/kw. Not bad; I expected much worse. No info on lifespan or expected hydrogen cost, though. (cont) If leakage proves to be a real substantial difficulty, there is an alternative - metal hydrides. Here is a recent analysis: https://undecidedmf.com/episodes/solid-hydrogen-explained-again-is-it-the-future-of-energy-storage/ ' Despite a much higher capital cost, binding hydrogen with a metal framework may work out as a cheaper storage solution in the long run. That’s what the Department of Energy (DOE) concluded when comparing the operation and maintenance (O&M) costs of different hydrogen storage technologies.13 They pegged metal hydride storage at 0.02$/kWh versus compressed gas and liquid hydrogen at 0.04 $/kWh and 0.06$/kWh.'

And:

' You can use clean electricity to power an electrolyser, which generates green hydrogen, and stores it in their metal hydride. This way, they can store solid hydrogen for months if needed until feeding it to a fuel cell to generate electricity on the way back out. They started a pilot in 2019 using their technology as a winter power backup for an off-grid house in the Alps.31 By recovering the waste heat, GKN system achieves a round-trip efficiency of 90%, which is about the same as a typical lithium ion battery. They’ve also integrated the system into a hot water heater setup to get some extra use out of the thermal heat. Based on the company white paper32, their solid hydrogen storage technology becomes more cost-effective for capacities higher than 80 kWh.'

Some designs of home fuel cells can run in reverse, so that they could make their own hydrogen from excess solar in the summer, for the winter, or the hydrides could be delivered like coal from, for instance, this Topsoe Haldor unit.

Home fuel cells integrate well with both heat pumps and solar.

Here is a design from Sunovate which also uses thermal from cooling the solar panels, which as a perk then operate at greater efficiency:

https://www.sunovate.com.au/faqs

We aren't there yet with cost effective complete energy systems at scale, but we can make a reasonable description of working highly efficient systems, even for northern Europe.

@peskanov:

Good call.
Here is a study giving very low lifetimes for SOEC:

' SOEL was originally developed by GE and Brookhaven National Laboratory in the 1970s. It operates at high temperature (700-900 ⁰C) which can achieve higher efficiencies than either AEL or PEMEL whereas material stability remains a challenge. SOEL currently have very short lifetimes (1,000 h) and they need much further development before they can be commercialised.
However, their potential is considerable, and they do not rely on PGM, using instead Ni/ceramic electrode technology.'

(pg7) that was in 2021.
But since Topsoe Haldor are building this commercial scale plant, it is clear that they reckon that they have resolved the issue enough for practicality in this very fast moving and highly proprietary field where players are not going to divulge all information.

Davemart,
even 10,000 hours would be considered low in that kind of application, because that would mean just 1.5 years of use. This kind of industrial process runs 24/7.

It's very difficult to make any cost estimation with the info you get from the hydrogen industrial pioneers.

@peskanov:

I could not find anything directly on Topsoe Haldor's cost projections per kg of hydrogen.

Of course, capital costs aside, how much the electricity from wind costs is the major factor, and the turbine fleets are just starting to be rolled out.

But we do know that Denmark is one of the players seeking to get hydrogen to $2kg shortly: https://www.power-technology.com/news/industry-news/un-green-hydrogen-catapult-iberdrola-orsted-snam/ ' ACWA Power CEO Paddy Padmanathan said: “We believe the private sector can deliver green hydrogen at less than$2/kg within four years. From an industry perspective, we see no technical barriers to achieving this, so it’s time to get on with the virtuous cycle of cost reduction through scale-up.”'

That was in 2020.

It seems to me likely that Topsoe Haldor is targeting that sort of figure not long after they have 500MW in operation.

But in any case, massive rises in NG prices mean that green hydrogen is already very competitive in Europe.

@peskanov:

Just so.

Topsoe Haldor are a major player in this field though, and are in my view unlikely to have totally screwed up their costings and durability estimates, as they have plenty of kit around the world which works just fine.

They use a completely different system to most SOECs using ceramics instead of rare elements, and durability estimates derived from others probably do not apply.

Here is the info they provide on their stack:

https://www.topsoe.com/our-resources/knowledge/our-products/equipment/soec

I am currently wading through their webinair linked there, and if there is relevant info I will post it here

@Davemart,
thanks in advance for any info you find on the electrolyzer lifespan.

Unfortunately, due to how the electric market operates in Europe, we are suffering the most expensive electricity ever, moving from 200E/Mwh to more than 400E. That would put electrolyzer hydrogen at >9E/kg.

The price of the electricity is pretty much directly connected to gas now, as the most expensive source of electricity (NG combined cycle right now) sets the price for the whole market.

Hopefully Brussels will wake up before the whole European industrial sector crashes...

@peskanov:

Got the durability, right at the end of the webinair, of course!

Their design is closely tied in with their existing units producing CO, which is a premium market, so they have been using allied tech for years.

They say at the end that they are used to working in the petrochemical industry, where the standard for equipment is 25 years, so much of their plant will be designed around that.

You don't get that out of the stack though, and as they say high temperature is trickier than low temperature, where they can hit 8 years of durability, with their HT stacks not there yet, but not far off.

Other info of interest is that the stacks are designed to handle rapid reductions in power, and cut offs.

They also have ammonia and methanol production in their sights, using this and related technology.

@peskanov;

I should also mention that they de-risk their technology for their customers, so that they bear the responsibility to maintain and keep running what they call the 'hot' part their equipment, ie the stack and closely associated stuff on a fixed price contract.

So they are very confident in their figures and estimates, as it is at their risk and expense.

That from a company which has been around in the field for decades, and so are obviously not in the habit of taking daft and ill informed gambles.

I would be as confident about their tech as it is reasonable possible to be, prior to the actual roll out and operation for some years of full commercial plants.

Topsoe Haldor are simultaneously ramping up their capacity to build electrolyser plants, to 500MW pa, so the example in the article is just the first of many, including other sites as well as its expansion in Denmark.

There are other players too of course in the electrolyser field in Europe, as well as China etc.

Hmm, this IS the electrolyser manufacturing plant. Please ignore my last comment!

I was momentarily confusing it with a hydrogen production plant, also of 500MW in the Netherlands:

https://www.renewableenergymagazine.com/hydrogen/hycc-launches-500mw-hydrogen-project-in-the-20220713

That aside, others going in at similar capacity in electrolyser manufacturing capacity to Topsoe Haldor include Navantia, a Spanish shipbuilder:

https://www.rechargenews.com/energy-transition/exclusive-shipbuilder-navantia-to-build-500mw-hydrogen-electrolyser-plant-with-world-renowned-technologist/2-1-1271647

The article mentions several others, and notes that many are outsourcing stack production

Whilst NEL is expanding its PEM technology FROM 500MW production capacity:

' The facility is named after its location, Herøya, and aims to decrease the costs associated with green hydrogen production while scaling up the use of hydrogen by identifying new application areas.

The plant’s current production capacity is 500MW, with plans to increase to 10GW capacity by 2025, depending on market appetite.

Nel plans to deliver renewable hydrogen at \$1.5/kg by 2025 by lowering the unit cost of electrode production.

“Half of the savings we need to make will come from scale-up and increased efficiency in production. The rest will come from the economy of scale, and from effective industrial partnerships,” says Jon André Løkke, Nel´s CEO.'

https://www.powerengineeringint.com/hydrogen/nel-launches-500mw-electrolyser-production-facility-in-norway/

That is not going to be as efficient as Topsoe Haldor's technology, and uses precious metals, but the efficiency can often be greater than would be assumed from the raw figures by the siting of hydrogen production facilities where they can get part of their energy input by the use of 'free' energy, in otherwise vented heat from industrial processes.

Actually, here are the other major manufacturing set ups mentioned in this article for making electrolysers:

https://www.rechargenews.com/energy-transition/exclusive-shipbuilder-navantia-to-build-500mw-hydrogen-electrolyser-plant-with-world-renowned-technologist/2-1-1271647

'US company Plug Power is building a 2GW electrolyser factory in Queensland, Australia, in a 50-50 joint venture with green hydrogen pure-play company Fortescue Future Industries, which is owned by that country’s richest man, Andrew “Twiggy” Forrest.

US-based Cummins has formed a joint venture with Chinese state-owned oil giant Sinopec to buid a 1GW PEM electrolyser factory in southern China.

And Belgium's John Cockerill is constructing a 2GW electrolyser plant in India in conjunction with local renewables developer Greenko.'

This 1MW PEM electrolyser produces 400kg of hydrogen a day:

https://www.eenewspower.com/en/1mw-fuel-cell-will-generate-400kg-of-hydrogen-a-day-for-german-busses/

That is around 150tons pa

So a 1GW electrolyser, not of the very efficient Topsoe Haldor type, can make around 150,000 tons of hydrogen a year.

Ammonia fertiliser production takes around 10 million tons of hydrogen a year.

So to decarbonise that one use, around 70GW or so of electrolysers are needed.

The roll out can only massively expand and continue for years.

Fortescue Metals alone plan to hit 15 million tons of hydrogen a year by 2030:

https://fuelcellsworks.com/news/billionaire-forrests-hydrogen-unit-to-speed-expansion-plans/

peskanov said:

' The price of the electricity is pretty much directly connected to gas now, as the most expensive source of electricity (NG combined cycle right now) sets the price for the whole market.'

Yeah, absurd. Renewables are falsely shown to have far higher costs than they are responsible for.

It is really the price of renewables which is at that level, not the costs, which are way lower than for using fossil fuels.

There are various ways to make them more rational, and incidentally save mass bankruptcies in Europe and the UK at the same time, but that seems to be beyond the politicos.

The true costs of producing power from renewables and derivatives like hydrogen is way lower than the cost using fossil fuels in Europe and some other places, it is just that the money is being hoovered away into profits for the fossil fuel companies with eccentric pricing systems.

@Davemart,
a few years of lifespan seems too short, as it would to several cents per kwh of output. Anyway, it's a beginning and Europe certainly will benefit from an hydrogen source independent of natural gas.

Imho, hydrogen is better used as feedstock now, for production of fertilizers, synthetic fuels, plastics, etc...
Much better if you can set a direct pipeline and avoid those costly methods of H2 transport.

@peskanov:

This will have detailed costings on the basis of their projected life for the stack, so so long as they hit that, they are going to make money.

The critical thing is that the stack is only a part, and presumably a small part, of the total outlay on the plant, the rest of which has a 25 year life.

@peskanov

Reading it back, my last may come across and know it all or something, for which apologies.

The reason I am so definite on the point, is unlike engineering etc this is an area where I have some level of expertise, cost and works accounting, even if many years ago.

If the engineers have given them the right lifespan for the stack, there is no way on God's earth that they will have messed up the costings so that that is not viable.

And the engineers have substantial experience on closely allied tech.

If you can find the time, do have a look at the video, as they lay out pretty comprehensively both all the elements of the plant, which has way more stuff than just the stack, and give a lot of other insights, although the best bits are at the end, the build up does show just how developed and within current practice most of the tech is.

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