SK E&S is advancing its steps to enter the Asian hydrogen market by cooperating with a US hydrogen energy industry leader, Plug Power.
On 6th, SK E&S announced that its shareholders have signed an agreement with their counterparts of Plug Power for establishing a joint venture, aimed at exploring Asian hydrogen markets together.
The signing ceremony, which took place in SK Seorin Building, was attended by Hyeong-wook Choo, the President and CEO of SK E&S, Andrew J. Marsh, the CEO of Plug Power and others.
During the ceremony, CEO H.W.Choo said, “The establishment of Joint Venture is meaningful as it secures the basis to enter the Asian market based on hydrogen related core technologies owned by Plug Power. it will provide SK E&S with an enormous competitiveness to build hydrogen ecosystem including green hydrogen production using water electrolys technology.” In response, CEO Marsh also said, “we can successfully enter the Asian hydrogen market by utilizing SK’s global business capabilities.”
SK E&S and Plug Power will own 51% and 49% of Joint Venture each.
Joint Venture plans by 2024 to build the “Giga Factory & R&D Center” in the Metropolitan Area with the capacity of mass-producing key equipment such as hydrogen fuel cells and water electrolysis systems, which will then be supplied to the domestic and overseas markets in Asia at drastically reduced cost on the Plug Power’s technology.
The capacity of water electrolys facility market is currently 125MW, but it is expected to grow into 490GW by 2040.
The PEMFC (Polymer Electorlyte Membrane Fuel Cell) to be produced in the “Giga Factory & R&D Center” has high energy efficiency and simple structure and operate at a low temperature, expanding its use in various applications including automobiles and power generation. Unlike other fuel cells which use LNG, LPG as fuel, it injects hydrogen directly, getting attention as environment-friendly power source that produce only clean water, electricity and heat.
Plug Power, which already provides forklifts embedded with hydrogen fuel cells to the largest global e-Commerce companies such as Amazon and Walmart, accounts for 95% of the US hydrogen forklift market. Based on such proven technological strength, Joint Venture plans to enter Korean and other hydrogen fuel cell markets in Asia.
The joint venture will also produce water electrolysis facilities in Korea and lead the effort to commercialize green hydrogen by utilizing such facilities. Water elecrolysis facilities is attracting a lot of attention as the key to hydrogen production of ecofriendly future as it does not generate CO2 in its process of producing hydrogen.
In particular, water electrolysis system technology (PEM method) of Plug Power is the most suitable to address the intermittency of renewable energy as it is less influenced than Alkaline water electrolysis by the fluctuation of power sources for water electrolysis processes.
“It is expected that Giga Factory & R&D Center is also expected to help Korea accumulate know-hows regarding the best water electrolysis technology of the world and expedite localization of such facility.” said SK E&S.
Later on the joint venture will also assume the role of distributing liquefied hydrogen produced by SK E&S to around 100 charging stations nationwide.
Plug Power has an accumulated expertise in running 120 liquefied hydrogen charging stations in the U.S. and utilizing tank lorries. Based on such technological capabilities SK E&S will stably expand its business in the liquefied hydrogen distribution market in Korea, which is now at its early stage.
SK E&S has presented a vision of becoming global No1 hydrogen provider by utilizing the LNG business infrastructure and value chain integration capability in the Media Day held last month. It plans to jump start hydrogen supply capacity by 2025 at an annual rate of 280,000tons consisting of 30,000tons of liquefied hydrogen and 250,000tons of blue hydrogen.
Plug Power is also spurring it effort to expand into the global market. Plug Power has been strengthening its global partnership by establishing join ventures with France car maker Renault and Acciona, the largest renewable energy company in Spain earlier this year.
An official from SK E&S said, “Joint Venture will be born as a H2 Total Solution Provider encompassing all areas of hydrogen ecosystem by combining the energy infrastructure and business capabilities in Asia with best technologies in the hydrogen industry of the world held by Plug Power.”