How Green Hydrogen and Electrolyzer Technology Are Enabling Plug Power’s Vertical Integration Strategy

August 13, 2020

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The Plug Power family has vertically integrated its hydrogen business, welcoming a pair of exciting new acquisitions this summer.  United Hydrogen Group Inc. and Giner ELX are two influential companies in the emerging hydrogen economy with tremendous capabilities in green hydrogen generation and storage. These acquisitions are in line with the Company’s vertical integration strategy in the hydrogen business as laid out in September of 2019, and specifically with plans to have green hydrogen account for more than 50% of Plug Power’s hydrogen usage by 2024. With these acquisitions, Plug Power is poised to become one of the largest green hydrogen generation companies in the United States and, eventually, the world. 

Green hydrogen represents a cornerstone of Plug Power’s long-term vertical integration strategy, and we believe it will be essential to our efforts to build a modern clean hydrogen economy. However, readers who aren’t familiar with the evolution of hydrogen generation technology may find themselves wondering, “What is green hydrogen, exactly—and why is it so important?” To answer this question, we’ll need to take a look at how hydrogen fuel is produced, and explore the reasons why some hydrogen production techniques are cleaner than others. 

How Hydrogen Goes Green

Hydrogen is the cleanest and most efficient fuel source that humanity has ever seen. Where virtually all other fuel sources (e.g., fossil fuels, biofuels, biomass, etc.) produce carbon dioxide or some other harmful emission as a byproduct of their consumption, using hydrogen in fuel cells produces only electricity, water, and heat. Unfortunately, while hydrogen fuel itself generates almost no emissions whatsoever, the process of producing hydrogen fuel is a different story. 

Hydrogen is the most abundant element in the universe, but you won’t find pure hydrogen just sitting around waiting to be put to use. Here on earth, naturally occurring hydrogen atoms are always bonded to something else, appearing in a long list of common compound substances like water (H2O), methane/natural gas (CH4), and even table sugar (C12H22O11). It takes a lot of energy to break those bonds and produce pure hydrogen. Most hydrogen fuel on the market today is produced using natural gas through a process known as steam methane reforming. Hydrogen generated through this process cannot be considered a truly zero-emission (or “green”) energy source, due to the CO2 emissions released during its production. 

One way to limit the CO2 emissions generated in steam methane reforming is to use carbon capture and storage (CCS) technology, which prevents a significant portion of that CO2 from ever reaching the atmosphere. Hydrogen produced in this way is known as blue hydrogen, and while blue hydrogen may not be entirely emissions-free, it is an important mid-step in the effort to reduce emissions. Green hydrogen is hydrogen that is produced using only renewable resources that don’t emit carbon dioxide or any other pollutants. This makes green hydrogen the only version of hydrogen fuel that is a 100% zero-emission energy source.

Electrolysis Brings Green Hydrogen to The Mainstream

The concept of green hydrogen has been around for a long time, but it’s only in the past few years that the technology for green hydrogen production has become both practical and cost effective. Today, the most efficient green hydrogen production techniques involve electrolysis, which is the process of using electricity to split water into hydrogen and oxygen. This chemical reaction takes place inside of an appliance called an electrolyzer, which is essentially a fuel cell operating in reverse. Like fuel cells, an electrolyzer is made up of an anode and a cathode separated by an electrolyte. The only difference is that fuel cells combine hydrogen and oxygen to produce water and electricity, while electrolyzers combine water and electricity to produce hydrogen and oxygen. 

Recent advances in polymer electrolyte membrane (PEM) electrolysis have made the process of electrolysis significantly more efficient in terms of both energy usage and operational costs. This, in turn, has made it much easier to couple electrolyzer systems with dynamic renewable energy sources like wind and solar. As a result, news outlets like Bloomberg New Energy Finance are now projecting that the cost of green hydrogen will decline by over 50% by 2030, and that electrolysis will soon reach parity with traditional hydrogen production techniques still in use today.

Why It’s Easy Being Green

Every day, electrolyzer technology gets a little more sophisticated, and the burgeoning hydrogen electrolyzer market gets a little bit bigger. That’s why, for the team here at Plug Power, the decision to acquire two leading companies in green hydrogen generation was a “no-brainer.” The team from Giner ELX in particular includes some of the world’s foremost experts in PEM electrolysis, many of whom have spent more than two decades in the field. With their expertise, and access to the extensive hydrogen infrastructure already put in place by United Hydrogen Group, Plug Power is well-positioned to help customers meet their sustainability and carbon reduction goals for years to come.

Join us on September 24th to learn more about Plug Power’s plans to build the clean hydrogen economy. Register by September 23, 2020 to take part in the virtual Plug Symposium.


Blue vs. Green Hydrogen