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Norwegian electrolyzer firm seeks price parity for green hydrogen by 2025

January 21, 2021

S&P Global Market Intelligence ($):

Norwegian electrolyzer-maker Nel ASA wants to reduce the cost of green hydrogen, produced with renewable electricity, to $1.50 per kilogram by 2025 in a bid to outcompete fossil fuel alternatives.

Cost reductions will be made by bringing the technology to multi-gigawatt scale and growing production capacity, the company said Jan. 21. Nel is building a large-scale electrolyzer manufacturing plant in Norway and looking to roll out the first 500 MW of equipment in the second quarter, with commercial production beginning in the third quarter.

The company has already linked up with Iberdrola SA to develop and deploy large-scale electrolyzer projects and promote the technology’s supply chain in Spain, and has signed a letter of intent with Statkraft AS to build a 50-MW green hydrogen electrolyzer in Norway.

Green hydrogen currently costs between €2.50/kg and €5.50/kg, or between $3.02/kg and $6.65/kg, according to the European Commission’s hydrogen strategy announced July 2020. Nel did not respond to a request about its current cost estimate for green hydrogen.

For comparison, fossil-based hydrogen costs about €1.50/kg, or $1.81/kg, and the estimated cost for blue hydrogen — produced from natural gas with carbon capture — is €2/kg, or $2.42/kg, the commission said.

[Camilla Naschert]

More ($): Electrolyzer-maker Nel targets green hydrogen at $1.50/kg

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