Israeli entrepreneur Talmon Marco has a strong track record in the start-up world. He co-founded the Viber messaging app, and developed a popular ride-sharing app. Now, he sees hydrogen as the next big opportunity. In 2019, he founded H2Pro with researchers from the Technion-Israel Institute of Technology, an institution renowned for fostering high-tech start-ups.
"Hydrogen is considered the Swiss Army knife when it comes to decarbonizing our economy for what are called 'hard sectors,' like aviation, steel production, industrial heat and heavy transport," explains Marco. "For all of these, we need hydrogen. It's important that we build a world, a better world, for our children or for our grandchildren. We need to clean up the mess that was created by this generation and previous generations."
Cost reduction is key
Unlike fossil fuels, hydrogen does not produce carbon dioxide emissions when burned. It can be obtained from natural gas or produced by splitting the hydrogen and oxygen molecules of water. Hydrogen produced the latter way using renewable energy is known as "green hydrogen." But it is currently still an expensive process.
Separating water into its component gasses requires care. If the hydrogen and oxygen react with each other, they can trigger an explosion. The traditional solution is to place membranes between them, but that process is expensive.
H2Pro came up with a new idea: nickel-plated electrodes that produce the hydrogen first, then the oxygen. They say this system is more efficient, and therefore should see the cost of hydrogen come down.
Green hydrogen currently costs between $5 and $10 per kilogram. H2Pro wants to get that down to $1 by 2030.
"$1 per kilogram is considered the holy grail of the green hydrogen economy," says Marco. "At $1, everything makes sense."
The company has raised $100 million in funding, with one of the investors being IN Venture, a venture capital firm funded by Sumitomo Corporation, one of Japan's biggest trading companies.
According to IN Venture Managing Partner Eyal Rosner, interest in new hydrogen technology is on the rise. "The market is very, very big, and we believe it's going to be even bigger once the technology allows cheap and clean hydrogen," he says.
Auto parts makers bet on the transition
Automakers are facing pressure to provide sustainable alternatives to gasoline-powered vehicles. Many are focusing on electric vehicles, including Toyota, though the automaker giant is also developing hydrogen combustion engines.
Some parts makers are doing the same. TPR, a Tokyo-based auto parts company renowned for its cylinder technology, started to invest in an Israeli start-up to prepare for the future. Its technologies are mainly used for gasoline combustion engines, and as the world is shifting more to EVs, the company is looking for new business opportunities.
It decided to invest $10 million in Aquarius Engines, which is developing engines with a simple system that can be used with hydrogen.
Tsukamoto Hideki, Executive Officer of TPR, explained the firm's plans. "We are considering the possibility of expanding our business from the conventional model of selling individual parts to developing engines on our own," he says. "When you look at the shift to being carbon-neutral, hydrogen has tremendous potential for our business."
Ohira Eiji sees the same potential. The Director General of the New Energy and Industrial Technology Development Organization, which promotes sustainable energy technologies, says Japan has an opportunity to take the lead in the hydrogen sector because of the investments it has already made, but believes the key is to ensure that both the supply and demand side of the market grow in tandem.
"We need to take a cue from other countries and work together with electric utilities, car manufacturers and other hydrogen consumers like steel manufacturers," he says. "Collaboration is key if we want to see a hydrogen revolution in the future."