As part of the TaiyangNews and SNEC Energy Storage, Hydrogen and Fuel Cell Leadership Conversations, Vice President of China's LONGi Hydrogen Wang Yingge gave an exclusive interview to TaiyangNews Managing Director Michael Schmela.
The interview was conducted at the recently concluded 8th (2023) International Energy Storage Technology, Equipment and Application Exhibition in Shanghai, China.
In the interaction (click on photo to watch video), Yingge discussed the hydrogen strategy of one of the world's largest solar PV manufacturers, and now the world's largest manufacturer of electrolyzers.
The Chinese group has been exploring energy storage since 2018 as it realized that the cost of solar PV was no longer a major concern given the drop in the levelized cost of electricity (LCOE) thanks to the advancement in PV technology, including the introduction of p-type solar cells.
Instead of cost, Yingge explained, the focal issue lies in managing the intermittency and reliability aspect, which is where LONGi turned its attention to storage.
The company established a dedicated storage strategy project team in 2018 to investigate hydrogen as a viable form of energy storage, transforming electricity into hydrogen. It found that hydrogen can be stored across all seasons, thus distinguishing itself from other chemical energy storage methods.
In 2020, the Chinese government announced its dual carbon goal of reaching peak carbon emissions by 2030 and thereafter achieving carbon neutrality by 2060 (see China Aims To Hit CO2 Peak Before 2030).
Yingge said the landscape entirely shifted for the company then as it was able to devise a definite future trajectory of hydrogen with this background, with a focus on facilitating decarbonization in diverse industrial domains, such as steel and petrochemicals. "This strategy aligns with the company's commitment to reducing carbon emissions within the industrial sphere," he added.
A market leader for electrolyzer manufacturing today, LONGi officially launched its hydrogen business vertical in March 2021. Within 6 months of its launch, the group established a hydrogen equipment factory in Wuxi, China and rolled out the 1st alkaline water electrolysis device with a capacity of 1,000 standard cubic meters/hour.
By the end of 2022, LONGi had increased its annual electrolyzer production capacity to 1.5 GW. At present, it has increased to 2.5 GW, comprising 1.5 GW at Wuxi and 500 MW at Xi'an. By 2025-end, it aims to further scale it up to 5 GW, according to the company's roadmap.
Yingge attributes the rapid growth of LONGi's hydrogen business to its brand presence in solar PV and renewable energy space, within and outside of China, including its marketing and sales channels. He also believes its focus on innovative technology research & development, and in-house manufacturing has played its part. LONGi currently has a team of over 100 employees, conducting in-depth research on hydrogen production equipment through electrolysis.
Explaining the group's rationale behind choosing alkaline electrolyzer technology, Yingge said according to the company's research, this stood out as a mature, stable and cost-effective route. It also has a longer lifespan. That said, LONGi continues to research on other hydrogen technologies as well.
Responding to Schmela's query regarding the major drivers for cost reduction for this technology, Yingge said the predominant component that determines the production cost of hydrogen is electricity. It constitutes close to 70% to 80% of the total production cost.
To manage these costs, LONGi has a 2-pronged strategy: 1st to drive down the cost of renewable energy sources as wind and solar along with advancements in energy storage, and 2nd to reduce the electricity consumption/unit of hydrogen produced.
In February 2023, LONGi's ALK Hi1 product was launched that, Yingge claims, effectively lowers the direct consumption of electrolyzer-based hydrogen production from around 4.5 kW to 4.6 kW, to approximately 4.0 kW to 4.3 kW.
Beyond electricity, equipment cost itself is high. Electrolytic cells available today are smaller in size as well as expensive with a lot of manual labor involved. As further industrialization takes place and a comprehensive supply chain emerges in this field with the presence of more enterprises, costs can be further driven down.
"With these targeted cost reduction measures, we envision the cost of green hydrogen reaching approximately $2.00 per kilogram within the next 5 to 10 years," stated Yingge.
To get there, it certainly requires subsidies as of now, which Yingge believes are available in regions like the US and the European Union (EU) that need to be replicated across the globe. Factoring in carbon cost is another significant consideration which varies from region to region. For instance, in the EU carbon prices can exceed €100 ($108)/tonne, in China it can range within RMB 50 to RMB 60 ($7 to 8)/tonne.
Eventually, the market forces will drive the progress of this industry. Nonetheless, Yingge stressed that the hydrogen industry needs to deal with a major bottleneck which is its utilization since forming a green hydrogen or green ammonia market will take some more time, possibly 3 to 5 years.
Going forward, LONGi wants to establish itself as a leading electrolyzer production equipment manufacturer that's economically viable, safe and reliable, while also developing solutions to produce green hydrogen using renewable electricity.
"Our goal is to seamlessly integrate its diverse technologies to address the intermittent and fluctuating nature of renewable energy, ensuring safety and reliability in control systems," signed off Yingge.