Dr Rebecca Lovell discusses the advancement of hydrogen
fuel cell technology, its adoption by industry leaders and how IP
rights can be used to drive investment.
When it comes to news about climate change and global initiatives
to ditch fossil fuels for zero carbon alternatives, batteries have
dominated the headlines over the past decade. But during this time,
another technology sector has been quietly growing and maturing to
the point of readiness for large scale rollout: the hydrogen and
fuel cell sector. Fuel cells use a catalyst (often platinum) to
convert hydrogen into electricity, emitting only water vapour as a
by-product. They can be used as an alternative to combustion
engines or batteries in a wide range of power applications –
from cars, trucks and buses to stationary power for buildings,
lighting and construction.
Unlike battery electric vehicles (BEVs), fuel cell electric
vehicles (FCEVs) retain many of the advantages of conventional
petrol or diesel vehicles, such as short refuelling times and long
range. Although several FCEV passenger cars are currently
available, such as the Toyota Mirai and Hyundai Nexo, the main
focus for FCEVs is currently in heavy duty applications such as
mass transit and haulage or in very lightweight applications such
as drones, where existing battery technology struggles to meet the
necessary requirements for weight, range and re-charging times.
Marine and aviation fuel cell projects have also got off the ground
recently, boosted by investment from incumbent manufacturers such
as Airbus. Hydrogen itself has a variety of potential applications
outside of fuel cells, such as in the national gas grid to
decarbonise heating and in steel manufacturing. It is therefore
clear that hydrogen and fuel cell technologies hold a huge amount
of promise as a solution for decarbonising transport and other
industries.
The commercial viability of fuel cells has long been derided and
dismissed due to the various challenges historically associated
with hydrogen (how do you produce it? how do you store it?
isn't it explosive?). Fortunately, safety standards have come a
long way in the 80-odd years since the Hindenburg disaster, and
modern hydrogen cylinders for use in FCEVs are incredibly robust.
Toyota, for example, tested the safety of the cylinders in their
Mirai passenger car by firing .50-caliber bullets at them from
point blank range, resulting in zero infernos. Production
techniques have also advanced at a rapid pace since the turn of the
millennium, overcoming a major hurdle in the race to achieve
widespread adoption of hydrogen technologies. Until recently, the
only cost-effective way to generate hydrogen at scale was by steam
reforming methane, which emits carbon monoxide as a by-product
– not exactly the greenest process and certainly not zero
carbon. Although carbon capture solutions may be used in
conjunction with steam reforming to prevent release of carbon
monoxide into the atmosphere (so-called "blue" hydrogen
production), improvements in electrolyser technology – and in
particular the increasing availability of cheap renewable energy
– has meant it is now economically viable to produce massive
quantities of green hydrogen by electrolysis of water.
This has made hydrogen and fuel cell technologies a highly
attractive prospect for governments and industries looking to meet
carbon emission targets and reduce their environmental impact. In
2020 we saw a particular surge in interest in hydrogen, with
countries such as Spain and Germany each committing €8billion
funding to green hydrogen projects, and the European Commission
publishing its "Hydrogen strategy for a climate-neutral
Europe" in July 2020, with a target of delivering 10 million
tons of renewable hydrogen by 2030 and cumulative investments of
€180-470 billion by 2050.
The value of shares in fuel cell and electrolysis companies like
Ceres Power, Plug Power and Nel Hydrogen soared between September
2020 and January 2021, as investors took note of huge deals with
household names such as Bosch, Renault and Royal Dutch Shell.
Underpinning these partnerships and joint ventures are strong IP
rights, which ensure that a larger business partner cannot simply
walk off with technology that the other partner has created.
However, different hydrogen and fuel cell companies have utilised
their IP in very different ways. ITM Power, for example, makes use
of its own electrolyser IP to manufacture products and sell
directly to industrial customers without a middleman, gradually
scaling up production volume and reinvesting the profits into
building a gigafactory in Sheffield. University spin-outs such as
Ceres Power and Bramble Energy, on the other hand, license out
their fuel cell patents to partners who already have large scale
manufacturing capacity, both in the UK and internationally,
avoiding the need for substantial capital investment in factories
and tooling. In the transport sector, several (predominantly
Japanese and South Korean) firms such as Toyota and Hyundai have
invested heavily in fuel cell R&D for many years and built up a
large patent portfolio in this area, while firms such as Honeywell
have recently added hydrogen IP to their repertoire by acquiring
upcoming fuel cell companies and subsidiaries.
Exclusive IP rights have therefore been a boon to owners of growing
hydrogen and fuel cell businesses looking to attract private
investment, form lucrative partnerships with big multinationals, or
sell their business on to a larger manufacturer. The trans-national
nature of many of these deals and partnerships has also highlighted
the need to carefully research which markets may be important in
the future and to apply for IP rights in those countries at an
early stage, where feasible. It is an exciting time for the
hydrogen and fuel cell industry, and many traditional manufacturers
are now seeking to buy in for a piece of the action. Therefore, as
the hydrogen and fuel cell industry continues to grow, due
diligence in contracts and IP rights will remain crucial to ensure
that innovators are duly rewarded and achieve the maximum return on
their investment in developing these new technologies.
This article first appeared in Energy Engineering - Issue 88.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.