Axios Pro: Climate Deals

January 11, 2023

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1 big thing: Heavy industry backs Hystar's green hydrogen

Illustration of hydrogen molecules surrounded by dollar elements and abstract shapes

Illustration: Gabriella Turrisi/Axios

Hystar, an Oslo, Norway-based developer of ultra-efficient hydrogen electrolyzers, closed a $26 million Series B round that was led by industry heavyweights and hydrogen-focused investors, Alan reports.

Why it matters: Hystar says the funding will enable it to reach commercial operation — bringing a new challenger to the increasingly crowded hydrogen production markets.

What's happening: Mitsubishi, the Japan-based conglomerate, and AP Ventures, a London-based VC largely focused on hydrogen, led the round.

  • Finindus, Nippon Steel Trading, Hillhouse Investment and Trustbridge Partners participated, as did existing investors Sintef Ventures and Firda.
  • The all-equity round closed Jan. 2.

Driving the news: Hystar figured out how to integrate a very thin membrane into the electrolyzers that are commonly used to make green hydrogen.

  • That enables a company to either consume 10%-15% less electricity or generate 150% more hydrogen.

Plus: Those ultra-thin membranes are already used in fuel cells — meaning the supply chain already exists.

Be smart: Hystar's efficiency gains are especially attractive for steel production, fertilizer manufacturing and other heavy industries that use huge amounts of electricity and heat.

👀 What we're watching: Hydrogen incentives in the Inflation Reduction Act have accelerated internal discussions about expanding to the U.S.

  • "That's one area we will prioritize," Hystar CEO Fredrik Mowill tells Alan.
  • "We will be looking to either partner up with companies in the U.S. or establish a presence there ourselves in the near to medium term."

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