China’s Sungrow Power Supply Co Ltd (SHE:300274) is one of the world’s largest producers of solar inverters, boasting an annual capacity of 305 GW. While the company is currently seeing high demand for its main products, it is also looking to expand in the market for electrolysers.
At a recent event, Solarplaza Summit Romania in Bucharest, Robert von Wahl, Sungrow’s Head of CEE Region, said that the company has set up a team of five people in Munich, who are working to bring electrolysers to the market. Soon after the event, Renewables Now interviewed Dr.-Ing Lin (Stefan) Zhao, Director Research Centre Germany.
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Q: Can you tell us more about the decision to create a team in Europe for the development of the electrolyser market? What are the main objectives and strategies of this team?
A: We created a dedicated team in Europe to focus on the development of the electrolyser market due to its growing significance in the hydrogen industry. The main objectives of this team are to drive innovation, enhance technology, and foster partnerships within the European market. Our strategies involve collaborating with key stakeholders, conducting market research, and developing cutting-edge electrolyser solutions to meet the region's demand for green hydrogen. Through this team, we aim to contribute to the decarbonisation of various sectors by promoting the adoption of electrolysis technology and facilitating the transition to a sustainable hydrogen economy.
Q: With a growing focus on hydrogen technologies, what opportunities and challenges do you see in the European market for electrolysers?
A: There is a rising demand for green hydrogen in Europe as countries aim to achieve their carbon reduction targets. This creates significant market opportunities for electrolysers. European countries are implementing supportive policies and regulations, such as incentives and subsidies, to promote the adoption of hydrogen technologies. These measures create a favourable business environment for electrolyser manufacturers. Furthermore, the establishment of hydrogen infrastructure, including hydrogen refueling stations and pipeline networks, opens up opportunities for the deployment of electrolysers and the integration of hydrogen into various sectors. However, there are also some challenges for the hydrogen market. One of the key challenges is achieving the cost competitiveness of electrolysers compared to traditional fossil fuel-based technologies. Cost reduction and scaling up of production are crucial to making electrolysers economically viable. The electrolyser technology is still evolving, and further advancements are needed to improve efficiency, durability, and scalability. Research and development efforts are necessary to overcome technical challenges. Last but not least, the development of a robust supply chain and infrastructure for electrolyser components, such as catalysts and membranes, is essential to meet the increasing demand and ensure a reliable and efficient supply of electrolysers.
Q: In terms of product differentiation, what sets Sungrow's electrolysers apart from competitors? Are they developed in-house?
A: Our electrolysers are developed leveraging our extensive in-house technological expertise. They are designed to be highly customisable and scalable, allowing us to cater to diverse customer requirements. Our offerings may include ancillary equipment, control systems, and support services, providing a holistic approach to meeting customer needs. Also, our expertise in the PV industry helps us very much. We can design and implement integrated systems that incorporate PV arrays, power conversion, energy storage, and electrolysers, optimising the overall performance and efficiency of the system.
Q: According to BNEF data, Sungrow had 1.1 GW of electrolyser manufacturing capacity in 2022 (1 GW ALK and 0.1 GW PEM electrolysers). Could you provide more details about the current manufacturing capacity and any potential plans for expansion, including the consideration of other locations in light of recent policy support from various governments?
A: The current capacity situation can refer to Bloomberg data, while we are expanding the second phase of the factory, which will double the production capacity at least. We do not exclude the possibility to consider other production locations. However, this will require a comprehensive consideration of market size, support policies, industry chain maturity, etc.
Q: What are the key applications or industries that Sungrow targets with its electrolysers? Are there any specific regions or countries where you see significant market potential?
A: Our company's electrolysers target a range of applications and industries in line with the growing demand for hydrogen. Some key areas of focus are energy, industrial hydrogen as a feedstock or process fuel, mobility and transportation sector. In terms of market potential, we see significant opportunities in several regions and countries, like Asia-Pacific, Europe, Middle East etc. Especially, the European market shows great potential due to ambitious hydrogen strategies and targets set by various countries within the European Union. Supportive policies, incentives, and funding mechanisms are driving the adoption of hydrogen technologies, making it a key market for our electrolysers. While these regions represent significant market potential, we remain open to opportunities globally and are committed to supporting the transition to a sustainable hydrogen economy wherever our expertise and products can create value.
Sungrow hydrogen products. Image by Sungrow.
