REPLAY ► Investing in Climate Action: The Case for Hydrogen - June 29, 2021
On Tuesday 29 June, Ardian launched the latest in its series of flagship climate events: “Investing in Climate Action: The Case for Hydrogen”. This summit brought together a leading group from high-profile public authorities and industry to discuss how industrial partners, public entities and financial institutions can collaborate to unlock large scale hydrogen investments to facilitate the energy transition.
More than 800 investors tuned into Ardian Infrastructure’s virtual summit, Investing in Climate Action: The Case for Hydrogen. The unique symposium included presentations by the leaders of the global effort to build a complete hydrogen value chain.
One of those hydrogen champions is Patrick Pouyanné, Chairman of the Board & CEO of TotalEnergies, who opened the event in conversation with Dominique Senequier, President of Ardian. M. Pouyanné outlined just some of the uses of the gas. “It [hydrogen] can help decarbonise the transportation sector, by powering electric motors through hydrogen fuel cells for trains or truck fleets, and at a later stage, airplanes.”
There is an unprecedented momentum for hydrogen: renewables become more competitive, Capex for electrolyzers and fuel cells have dropped. The industrials are ready, the financial sector is ready, governments must now act and implement their announced strategies without too many regulatory barriers.
Dominique Senequier elaborated in her conversation on the purpose of this summit, and her firm belief in the alternative energy source, reiterating the need for collaboration, stating: “(…) we know that hydrogen will play a key role in our future, but many people need to come together to make it happen.” The Ardian Founder also reemphasised the importance of creating an environment conducive to the energy transition, across finance and beyond.
The hydrogen value chain is firmly a part of sustainable finance. [Now] everyone recognizes that hydrogen will play a key role in our future.
Key to Net Zero
It is now clear to the world that hydrogen will be key both to carbon reduction and to the wider energy transition, but cooperation will be needed, and time is of the essence. Mathias Burghardt, Head of Ardian Infrastructure, said: “All stakeholders must collaborate, each bringing their stone to the building.” He said:
- 1. Governments need to enforce their net zero commitments thoroughly.
- 2. Industrial actors need to decarbonize their processes, operationally and with respect to their supply chains.
- 3. Financial institutions need to channel investment into businesses that foster the energy transition.
We believe that green hydrogen, produced thanks to renewable energy, is a great opportunity for us as investors.
Global leadership
The Summit continued with an unprecedented round-table discussion which brought together:
-
Secretary Ernest Moniz, former Secretary of the US Department of Energy
-
Dr Fatih Birol, Executive Director of the International Energy Agency
-
Dr Klaus Bonhoff, Director General of Germany’s Federal Ministry for Transport and Digital Infrastructure
-
Musabbeh Al Kaabi, CEO of Mubadala’s UAE Investments Platform
-
Noé van Hulst, Chair of IPHE, the International Partnership for Hydrogen and Fuel Cells in the Economy.
The talk turned technical as Fabio Ferrari, Ardian Operating Partner and Founder of fuel-cell producer Symbio, talked with Dr.-Ing Sae Hoon Kim, Executive Vice President of the Fuel Cell Center at Hyundai Motor Group. Ferrari explained that hydrogen technology is “quite mature.” The challenge now, he explained, is to expand generation capacity from electrolysers powered by renewable electricity, which use wind or solar power to turn water into hydrogen. That technology is proven, as are fuel cells, which reverse the process to produce electricity and power vehicles.
Everything is available. Now we need to build the complete value chain, simultaneously.
Hydrogen in action
A keynote speech by Daryl Wilson, Executive Director of the Hydrogen Council, reported that as of January 2021, 228 hydrogen projects of a megawatt or greater are beyond proposal phase, including 17 giga-scale, 90 large-scale industrial, and 53 transport projects. They reflect capex of $262 billion, of which $40 billion is already post-investment. He described “a stunning jump in projects” since those numbers were calculated, and said that “this large scale of investment speaks to tremendous momentum, which will continuously drive costs down.”
Wilson’s enlightening presentation about current projects was followed by a second roundtable which delivered the various perspectives of some of the people running them. Chaired by Ardian Infrastructure’s Managing Energy Transition Lead, Amir Sharifi, the conversation featured:
-
Dr Urban Keussen, CTO and member of the Executive Board of of German utility EWE
-
Renato Mazzoncini, CEO of Italy’s A2A
-
Marcelino Oreja, CEO of Spain’s Enagas
-
Martin Mugica, President and CEO of American producer Skyline Renewables
-
Pierre-Etienne Franc, CEO of FiveT Hydrogen
Every day we read about the importance of hydrogen, and see new hydrogen initiatives announced. Each week we witness $1 billion worth of new projects in this field. Our question now is: can we confidently invest in hydrogen projects?
Two challenges
The answer is an unconditional yes, Sharifi said, noting that appropriate regulation must be set as soon as possible, and a global market for hydrogen trading created and fostered. “We are working hand in hand with our portfolio companies and industrial partners to be involved in all countries where we invest… We must make a collective effort to raise the hydrogen market to maturity, and build a strong regulatory environment for infrastructure investment.”
“The time has come to step up our efforts in the hydrogen space,” he concluded. “This will be the decade of hydrogen, the new asset class. We will work hand in hand with regulators, partner with industry players, and cooperate with the best specialists (including FiveT Hydrogen) to make this a collective success!”
