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Exclusive: Electric Hydrogen gears up with $50M for factory equipment

A researcher works on equipment that makes up an electrolyzer for green hydrogen company Electric Hydrogen

A researcher works on equipment that makes up an electrolyzer for Electric Hydrogen. Photo courtesy of Electric Hydrogen

Green hydrogen unicorn Electric Hydrogen has raised $50 million in equipment financing, the company tells Axios exclusively.

Why it matters: The company is preparing to make electrolyzers that can produce green hydrogen at its first large factory in Devens, Mass.

Zoom in: The non-dilutive financing was provided by investment group Trinity Capital, which has also provided equipment financing for climate companies like alt meat firm Impossible Foods, zinc battery maker Eos Energy, and geothermal heat pump startup Dandelion Energy.

  • While Electric Hydrogen previously raised over $600 million from investors, the company can get a lower cost of capital for equipment financing.
  • The funding from Trinity Capital shows that Electric Hydrogen is getting closer to bankability, says Electric Hydrogen's SVP of Global Sales Jason Mortimer. "Project finance is what is going to make this industry happen."

Catch up quick: Electric Hydrogen closed a Series C round of a whopping $380 million last year from investors including BP, United Airlines, Microsoft and Fortescue Metals, among others, valuing the company at over $1 billion.

  • Previous investors include Amazon's Climate Pledge Fund, Breakthrough Energy Ventures and metal and mining giant Rio Tinto.
  • The company says its electrolyzers can help producers make hydrogen for a lower cost compared with competitors.
  • Certain sectors that are tricky to decarbonize are looking at clean energy-fueled hydrogen production as a potential solution, including steel makers, airlines, and heavy-duty trucking.

Big picture: The Inflation Reduction Act is offering major subsidies for green hydrogen through tax credits and other types of support.

  • While the green hydrogen market has a bulging pipeline of projects, it's got very few deployments actually operating.
  • According to Wood Mackenzie, there are 6.59 million tons per annum worth of green hydrogen projects in the pre-development phase in the U.S., but only 0.01 million tons operating.
  • Electric Hydrogen's electrolyzers could play a key role in kicking off the emerging market.

What's next: Electric Hydrogen needs to begin producing electrolyzers in large volumes at the Devens factory to be able to reach its target low-cost price point, and a lot can go awry during manufacturing scale-up.

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