Large-scale hydrogen projects are moving through execution toward production and the opportunity to begin fulfilling the promise of the sector, and the day two ADIPEC panel session called “Hydrogen’s next chapter: from FID to first molecules” examined some of the challenges still to come.
Elena Scaltritti, President & CEO, Topsoe, said it was “a bit early to talk about performance,” but there had been some learnings as a company with several large projects underway.
“There will be surprises, both in terms of, let’s say, keeping on track with project development, but certainly as well when we go to performance and operations. There, our approach is to stay very close to our customers on a lifelong journey,” she said.
“I would say what surprised our customers most is demand, which has evolved over the last few years. Many have been looking at Europe as the leading demand creator, and there’s more uncertainty now.”
Alex Tancock, CEO, InterContinental Energy, agreed that a big challenge discussed at many conferences is matching customer demand with what you can produce.
One of the things about hydrogen is people are disappointed that it didn’t go ballistic, that it didn’t do an AI, but actually, it’s tracking faster than the equivalents did.
Projects close to both renewable resources and customers, with demand at the production site, are better positioned, the Momentum Theatre audience was told.
And when the idea of AI versus hydrogen in terms of energy availability was raised, it was revealed that not all projects have progressed so well.
“Basically, all the projects that thought they were going to buy cheap power from the grid and turn it into hydrogen … most of them have fallen over now, because all that power is going into compute,” said Tancock.
“Compute is willing to pay more. Electric vehicles are willing to pay more. So, there’s an entire raft of business models on hydrogen that have just died.
“From our point of view, we’ve been pretty lucky in that the projects we started developing didn’t need grid connections, and they also were next to the sources of demand.
“So, when we made design choices 10 years ago, I guess we stumbled onto the right choices. And this whole AI thing has turned out to be a huge enabler for us as a company as well.”
Against a backdrop of regional conflict and policy uncertainty, panellists identified diversification, partnerships and resilience as increasingly important amidst disruption and changing policy.
Ahmed El-Hoshy, CEO, Fertiglobe, said it was a reminder that “it’s very hard to have all your eggs in one basket,” as he stressed the importance of partnerships and spreading production and supply chain risks.
“Diversification has been really important for us as a company,” he said.
“Whether it’s pre-eight months ago or now, the importance of partnerships is really very key because you see sometimes with this deep globalisation that we’ve seen and localisation you could see things that don’t really make a lot of economic sense.
“So, it’s important to try to find partners that can have a competitive advantage that are complementary to you.”
El-Hoshy added: “What helped make us successful is kind of looking and saying, ‘where’s the best outcome, and who can we partner with? Who takes on which risk, and who is best to handle it’, so that we can progress forward.”
Some quarters have criticised hydrogen for not yet living up to the hype, but the panellists suggested it was on the right course.
“One of the things about hydrogen is people are disappointed that it didn’t go ballistic, that it didn’t do an AI, but actually, it’s tracking faster than the equivalents did,” said Tancock.
“I’ve been doing renewables for almost three decades, and this is my third cycle. I’m of the view that we’ve seen this happen before, where attention rises, and then it fades, and then it rises, and then it fades, and now we’re in a bit of a fade.”
