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Turnt up about turndown ratios

Optimizing electrolysis for renewables depends not just on how far you can turn the machine up, but how far you can turn it down. We asked electrolyzer makers: how low can you go?

Optimizing electrolysis for renewables depends not just on how far you can turn the machine up, but how far you can turn it down.

A consensus is growing around the importance of turndown ratios for electrolyzers, with a variety of use cases for green hydrogen requiring the machines to be run at low levels during periods of high power pricing.

Proton exchange membrane (PEM) electrolyzers are known for their ability to quickly ramp production up and down, but manufacturers of all stripes have begun to tout their technologies’ turndown ratios, with implications for capital costs and the levelized cost of producing hydrogen from renewable power.

Simply put, some electrolyzer plant operators will likely seek to lower hydrogen production during periods of high power pricing, since the cost of electricity is the largest operating expense. But cycling the electrolyzers completely off and on can lead to added system degradation, giving importance to the ability of the machines to run at low levels.

A study from the National Renewable Energy Laboratory (NREL) analyzes a US grid buildout through 2050, noting favorable locations and seasonality for power pricing as something of a guideline for green hydrogen development. The study notes that the lowest achievable turndown ratio is a main factor in minimizing hydrogen levelized cost along with the number of hours a system can operate at that minimum level – something that applies to all types of electrolyzers.

“When you start to look at hourly costs from the data in different locations, you see that all of this renewable buildout is going to create opportunities in given locations where you going to have a lot of renewable generation and not a lot of load on the system and that’s going to drive the cost for that energy down,” said Alex Badgett, an author of the study at NREL.

To be sure, the fast-moving technological environment for electrolysis leaves open the possibility for efficiency gains and disruptive innovation. And a variety of factors – balance of plant, energy efficiency, system degradation – also influence plant economics. But the lowest possible turndown ratios will drive opportunities for green hydrogen developers, Badgett said.

ReSource reviewed available spec sheets for electrolyzer providers and asked every maker of PEM and SOEC systems to detail the turndown capabilities of their machines. Alkaline electrolyzers were left out of the analysis given their more limited load flexibility, as their separators are less effective at preventing potentially dangerous cross-diffusion of gasses. Some manufacturers are fully transparent regarding turndown ranges while others declined to comment or did not reply to inquiries.

‘Not trivial’

In designing projects, developers are analyzing hourly energy supply schedules and pairing the outlook with what is known about available technology options.

“Some electrolyzers like to operate at half power, and others like to operate at full power, and in any given system, you can have between 10 and 50 electrolyzers wired and plumbed in parallel,” said Mike Grunow, who leads the Power-to-X platform at Strata Clean Energy.

“Our thought process even goes down to: let’s say you have to operate the H2 plant at 25% throughput. Do you operate all of the electrolyzers at 25%, or do you turn 75% of the electrolyzers off and only operate 25% at full power?”

The difference in the schemes, he added, is “not trivial as each technology has different efficiency curves and drivers of degradation.”

Different use cases for the hydrogen derivative, meanwhile, lead to different natural selection of technologies, Grunow said, adding that the innovation cycle is now happening every 12 months, requiring a close eye on advances in technology. 

Electrolyzer start-up Electric Hydrogen, a maker of PEM electrolyzers, is commercializing a 100 MW system that can turn down to 10%, according to Jason Mortimer, SVP of global sales at the company.

HyAxium, another start-up, can turn its system down to 10%, according to its materials. Norway-based Hystar, which recently announced plans to build a plant in the US, also promotes a 10% turndown ratio.

A more established PEM electrolyzer provider, Cummins, advertises turndown ratios of 5% for its machines. Sungrow Power, a China-based manufacturer, similarly advertises 5% for PEM electrolyzers.

Siemens Energy has a minimum turndown ratio per stack of 40%, but for a single system it can be less in exceptional cases, according to Claudia Nehring, a company spokesperson.

“We focus on large systems” – greater than 100 MW – “and currently consider this value to be appropriate, taking into account the optimization between efficiency, degradation and dynamics, but are working on an improvement,” she said via email.

ITM Power declined to provide details but said its turndown capabilities are “to be expected” for a market leader in this technology. Materials from German-based H-Tec Systems note a modulation rate down to 10%.

Additional PEM makers Nel, Ohmium, Elogen, H2B2, Hoeller Electrolyzer, Plug Power, Shanghai Electric, and Teledyne Energy Systems did not respond to requests for information.

PEM alternatives

Other forms of electrolysis can also ramp dynamically. And some project developers point to PEM’s use of iridium, part of the platinum metals family, as a drawback due to potential scarcity issues.

Verdagy, for example, has developed an advanced alkaline water electrolysis (AWE) system called eDynamic that it says takes the best of PEM and alkaline technologies while designing out the downsides.

The company’s technology “addresses the barriers that limited traditional AWE adoption by using single-element cells that can operate efficiently at high current densities,” executives said in response to emailed questions. 

“The ability to operate at very high current densities, coupled with a balance of stack and balance of plant optimized for dynamic operation, allow Verdagy’s electrolyzers to operate across a very broad range spanning 0.1-2.0 A/cm2,” they said.

In other words, the machine can turn down to 5%, part of the design that enables operators “to modulate production to take advantage of time-of-day pricing and/or fluctuations in energy production.”

Meanwhile, German-based Thysenkrupp Nucera, another maker of advanced water electrolyzers, advertises a 10% turndown ratio.

SOEC

A relatively new electrolysis technology, the solid oxide electrolyzer cell has also proven to be capable of low turndown ratios. Solid oxide electrolysis is particularly attractive when paired with high-temperature industrial processes, where heat can be captured and fed back into the high-temperature SOEC process, making it more efficient.

Joel Moser, the CEO of First Ammonia, said he chose SOEC from Denmark-based Haldor Topsoe in part because the machines can be turned completely off with no degradation, as long as you keep them warm.

“Generally speaking we expect to ramp up and ramp down between 100% and 10%,” he said. “We can turn them off as long as we keep them warm, and then we can turn them right back on.”

Still, SOEC systems are not without challenges.

“Low stack power and high operating temperature, which in turn requires more ancillary equipment to operate the electrolyzer, are widely viewed as the main drawbacks of SOEC technology,” according to a report from the Clean Air Task Force, which explores SOEC technology and its commercial prospects. “SOEC systems are also considered to have a shorter operating life due to thermal stress.”

Additional makers of SOEC machines Bloom Energy, Ceres, Elcogen, Genvia, SolydERA, and Toshiba did not respond to inquiries.

At NREL, researchers are watching for more automation and scale in the electrolyzer production process to bring costs down. Increasing efficiency through balance-of-plant improvements is another opportunity to reduce system costs.

In addition, more analysis of how large electrolyzer projects will impact the future electrical grid is required, according to Badgett.

The NREL team modeled the hourly marginal cost at any given time in any location in the US, but the model assumes that the electrolyzer takes energy without impacting the cost of energy.

“When we start to get to gigawatt-scale electrolysis,” he said, “that’s going to significantly impact prices, as well as how the grid is going to build out.”

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Exclusive: Inside Strata’s P2X strategy

Strata Clean Energy is seeking to engage with global chemical, energy, and shipping companies as a potential partner for a pipeline of green hydrogen projects that will have FIDs in 2025 and CODs later this decade.

Strata Clean Energy is developing a pipeline of green hydrogen projects that will produce large amounts of green ammonia and other hydrogen derivatives later this decade.

Mike Grunow, executive vice president and general manager of Strata’s Power-to-X platform, said in an interview that the company is investing in the development of proprietary modeling and optimization software that forms part of its strategy to de-risk Power-to-X projects for compliance with strict 45V tax credit standards.

“We’re anticipating having the ability to produce substantial amounts of low-carbon ammonia in the back half of this decade from a maturing pipeline of projects that we’ve been developing, and we’re looking to collaborate with global chemical, energy, and shipping companies on the next steps for these projects,” he said.

Strata’s approach to potential strategic offtakers could also include the partner taking an equity stake in projects, “with the right partner,” Grunow said. The projects are expected to reach FID in 2025.

Grunow declined to comment on the specific size or regional focus of the projects.

“We aspire for the projects to be as large as possible,” he said. “All of the projects are in deep discussions with the regional transmission providers to determine the schedule at which more and more transmission capacity can be made available.”

Strata will apply its expertise in renewable energy to the green hydrogen industry, he said, which involves the deployment of unique combinations of renewable energy, energy storage, and energy trading to deliver structured products to large industrial clients, municipal utilities and regulated utilities.

The company “commits to providing 100% hourly matched renewable energy over a guaranteed set of hours over the course of an entire year for 10 – 20 years,” Grunow said.

“It’s our expectation that the European regulations and more of the global regulations, and the guidance from the US Treasury will require that the clean energy supply projects are additional, deliverable within the same ISO/RTO, and that, eventually, the load of the electrolyzer will need to follow the production of the generation,” he said.

Strata’s strategy for de-risking compliance with the Inflation Reduction Act’s 45V revenue stream for green hydrogen will give asset-level lenders certainty on the delivery of a project’s IRA incentives.

“Right now, if I’m looking at a project with an hourly matched 45V revenue stream, I have substantial doubt about that project’s ability to actually staple the hourly matched RECs to the amount of hydrogen produced in an hour, to the ton of hydrogen derivative,” he said.

During the design phase, developers evaluate multiple electrolyzer technologies, hourly matching of variable generation, price uncertainty and carbon intensity of the grid, plant availability and maintenance costs along with evolving 45V compliance requirements.

Meanwhile, during the operational phase, complex revenue streams need to be optimized. In certain markets with massive electrical loads, an operator has the opportunity to earn demand response and ancillary service revenues, Grunow said.

Optimal operations

“The key to maximizing the value of these assets is optimal operations,” he said, noting project optionality between buying and selling energy, making and storing hydrogen, and using hydrogen to make a derivative such as ammonia or methanol.

Using its software, Strata can make a complete digital twin of a proposed plant in the design phase, which accounts for the specifications of the commercially available electrolyzer families.

Strata analyzes an hourly energy supply schedule for every project it evaluates, across 8,760 hours a year and 20 years of expected operating life. It can then cue up that digital project twin – with everything known about the technology options, their ability to ramp and turn down, and the drivers of degradation – and analyze optimization for different electrolyzer operating formats. 

“It’s fascinating right now because the technology development cycle is happening in less than 12 months, so every year you need to check back in with all the vendors,” he said. “This software tool allows us to do that in a hyper-efficient way.”

A major hurdle the green hydrogen industry still needs to overcome, according to Grunow, is aligning the commercial aspects of electrolysis with its advances in technological innovation.

“The lender at the project level needs the technology vendor to take technology and operational risk for 10 years,” he said. “So you need a long-term service agreement, an availability guarantee, key performance metric guarantees on conversion efficiency,” he said, “and those guarantees must have liquidated damages for underperformance, and those liquidated damages must be backstopped by a limitation of liability and a domestic entity with substantial credit. Otherwise these projects won’t get financed.”

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Ammonia-to-industrial heat provider raising early-stage capital

An early-stage technology provider targeting clients in hard-to-abate industries is engaging investors and financial advisors to raise a seed round, with sites on a Series A in 2025.

Captain Energy, a Houston-based provider of ammonia-to-industrial heat technology, is seeking strategic investors for an early-stage seed round with plans for an eventual Series A, co-founder and interim-CEO Kirk Coburn said in an interview.

The company is developing a single-step process that can create industrial heat from cracked ammonia up to 700 degrees Celsius with zero NOX emissions, with hydrogen as a byproduct, Coburn said. The process uses a ceramic-based tubular solid oxide fuel cell that Captain manufactures in Dundee, Scotland.

“The results from the testing are that we’re 85% efficient,” Coburn said.

He likened the company to Amogy, but serving steel, cement and chemicals instead of transportation. Getting the kind of high-quality heat those industries need in a clean way can only come from a few sources, he noted.
“Ammonia is one of the greatest ways to do it if you can crack it efficiently like we can,” he said.
Past lab

The company is “past the lab stage” and needs to develop a pilot product to showcase to customers, Coburn said. About $5m will get the company to a 100-kilogram-per-day product, up from 25 kilograms now.

“That’s not, probably, big enough for most customers, but we can stack them,” Coburn said. “At this point we need to demonstrate commercially the product… after showcasing it we want to make larger units.”

Captain is owned by three co-founders, including Coburn. They have an 18-month line of site on a “much larger” Series A, Coburn said.

Strategic investors that would be end users of the technology are of interest to the company, particularly in Asian and European markets.

“We’re not getting in the game of making ammonia,” Coburn said. “We have to buy green ammonia.”

The company’s model is at “grid-parity” in Europe now, Coburn said, pointing to Germany in particular.

“We think we’re almost at subsidy-free pricing,” he said.

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Exclusive: Pattern Energy developing $9bn Texas green ammonia project

One of the largest operators of renewable energy in the Americas, San Francisco-based Pattern is advancing a 1-million-ton-per-year green ammonia project in Texas.

Pattern Energy knows a thing or two about large renewable energy projects.

It built Western Spirit Wind, a 1,050 MW project in New Mexico representing the largest wind power resource ever constructed in a single phase in the Americas. And it has broken ground on SunZia, a 3.5 GW wind project in the same state – the largest of its kind in the Western Hemisphere.

Now it is pursuing a 1-million-ton-per-year green ammonia project in Corpus Christi, Texas, at an expected cost of $9bn, according to Erika Taugher, a director at Pattern.

The facility is projected to come online in 2028, and is just one of four green hydrogen projects the company is developing. The Argentia Renewables project in Newfoundland and Labrador, Canada is marching toward the start of construction next year, and Pattern is also pursuing two earlier-stage projects in Texas, Taugher said in an interview.

The Corpus Christi project consists of a new renewables project, electrolyzers, storage, and a pipeline, because the electrolyzer site is away from the seaport. It also includes a marine fuels terminal and an ammonia synthesis plant.

Pattern has renewable assets in West and South Texas and is acquiring additional land to build new renewables that would allow for tax incentives that require additionality, Taugher said.

Financing for the project is still coming together, with JV partners and prospective offtakers likely to take project equity stakes along with potential outside equity investors. No bank has been mandated yet for the financing.

Argentia

At the Argentia project, Pattern is building 300 MW of wind power to produce 90 tons per day of green hydrogen, which will be used to make approximately 400 tons per day of green ammonia. The ammonia will be shipped to counterparties in Europe, offtake contracts for which are still under negotiation.

“The Canadian project is particularly exciting because we’re not waiting on policy to determine how it’s being built,” Taugher said. “The wind is directly powering our electrolyzers there, and any additional grid power that we need from the utility is coming from a clean grid, comprised of hydropower.“

“We don’t need to wait for rules on time-matching and additionality,” she added, but noted the renewables will likely benefit from Canada’s investment tax credits, which would mean the resulting ammonia may not qualify under Europe’s rules for renewable fuels of non-biological origin (RFNBO) as recently enacted.

Many of the potential offtakers are similarly considering taking equity stakes in the Argentia project, Taugher added.

Domestic offtake

Pattern is also pursuing two early-stage projects in Texas that would seek to provide green hydrogen to the domestic offtake market.

In the Texas Panhandle, Pattern is looking to repower existing wind assets and add more wind and solar capacity that would power green hydrogen production.

In the Permian Basin, the company has optioned land and is conducting environmental and water feasibility studies to prove out the case for green hydrogen. Pattern is considering local offtake and is also in discussions to tie into a pipeline that would transport the hydrogen to the Gulf Coast.

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