In an era where the hydrogen industry is gaining significant traction as an important component of sustainable energy solutions, companies are poised to harness its potential to revolutionize various sectors. 

As a key player in the provision of innovative stacks for hydrogen production using pressurized Alkaline electrolysers, Stargate Hydrogen recognizes the paramount importance of mitigating risks by diversifying hydrogen stack suppliers and considering technologies other than just PEM (Proton Exchange Membrane).

Pressurized alkaline stacks are a promising alternative to PEM for hydrogen production due to their cost-effectiveness, durability, scalability, and compatibility with renewable energy sources, especially in larger-scale industrial settings. This strategic move ensures the seamless continuity of operations and safeguards against potential disruptions that might arise from relying solely on one supplier. 

If you represent an engineering company looking to become a hydrogen stack integrator our latest guide will be a high-value asset. Download the guide here and ensure you will make informed decisions to achieve optimal efficiency. 

Navigating the Prosperous Landscape of the Green Hydrogen Industry 

The surge in interest surrounding hydrogen stems from its ability to serve as a clean, efficient, and versatile energy carrier. Its applications span various hard-to-abate sectors, such as steelmaking, fertilizer and chemical industries, transportation, power generation, industrial processes, and more. 

This growing demand has led to a surge in the production and deployment of green hydrogen-related technologies, in contrast with alternatives like steam methane reforming or blue hydrogen, specifically when produced via alkaline electrolysis. 

However, as the industry thrives and evolves, the potential risks associated with relying on a single supplier for critical industrial parts like electrolysers become increasingly apparent. This is where the concept of diversifying hydrogen stack suppliers emerges as a strategic imperative. 

Risk Mitigation Through Supplier Diversification 

Recent global supply chain disruptions underscore the significance of diversification. Unforeseen events, whether they be natural disasters, geopolitical tensions, or supplier-specific issues, can significantly impact the supply of stacks. For companies investing in hydrogen production, the reliance on a sole supplier for stacks presents a potential vulnerability. 

Imagine a scenario where a company's entire hydrogen production is contingent on a single supplier for stacks. Any disruption or unforeseen circumstances that affect that supplier could lead to severe operational halts, delays in projects, and significant financial repercussions. This risk amplifies when considering the lead times associated with manufacturing and procurement of specialized equipment in the hydrogen industry. 

By diversifying hydrogen stack suppliers of key industrial parts such as a stack, companies effectively spread the risk. This mitigates the impact of potential disruptions from a sole source, ensuring operational continuity and stability even in challenging times. 

Unlocking Competitive Edge and Innovation 

Beyond risk mitigation, diversifying hydrogen stack suppliers can unlock numerous advantages for companies operating in the hydrogen sector. Engaging with multiple suppliers fosters healthy competition, encourages innovation, and drives technological advancements. Companies are incentivised to enhance their offerings, improve product quality, and explore cost-effective solutions to gain a competitive edge in the market. 

Partnering with diverse hydrogen stack suppliers can also provide access to a broader pool of expertise, insights, and specialised knowledge. This collaboration can be instrumental in driving research and development initiatives, leading to the creation of more efficient, reliable, and scalable electrolyser solutions. 

The resilience of operations within the hydrogen industry depends heavily on the reliability and availability of essential components. Considering different hydrogen stack suppliers strengthens a company's resilience by reducing dependency on a singular source. It enables a strategic buffer, allowing for flexibility in sourcing, negotiating favorable terms, and adapting swiftly to market fluctuations or unforeseen events. 

Choosing the technology: Alkaline Vs. PEM 

Alkaline electrolysis and PEM electrolysis represent two distinct methods used for hydrogen production through water electrolysis. While both processes harness electrical energy to split water into hydrogen and oxygen, the fundamental differences lie in their operational efficiency, scalability, and cost-effectiveness. 

One of the primary advantages of alkaline electrolysis is its proven track record of reliability and cost efficiency. At Stargate Hydrogen, our R&D team is developing a novel approach based on the best aspects of proven alkaline technology complemented by breakthrough materials. This will result in a completely new class of electrolysers—ceramics-based alkaline electrolysers, that have high current densities and high efficiencies but contain no precious metals. This results in significantly lower hydrogen production costs and electrolyser affordability for the end users.  

Alkaline stacks boast a longer operational lifespan compared to PEM systems. The robustness of alkaline electrolysis equipment ensures prolonged durability and minimal maintenance requirements, translating into reduced downtime and increased productivity. This longevity is a testament to the stability and endurance of the alkaline technology. This is a compelling advantage over PEM electrolysis systems that often face challenges related to membrane degradation and shorter lifespans. 

Plus, our alkaline electrolysis technology exhibits remarkable scalability, catering to diverse industrial needs. Whether it is large-scale hydrogen production for industries or decentralised applications in remote areas, the scalability of our systems ensures flexibility and adaptability across various operational environments. This versatility contrasts with the limited scalability of PEM technology, which is often more suitable for smaller-scale applications due to its inherent design constraints and higher manufacturing costs.

However, there are a few common points that critics raise against the alkaline approach to hydrogen production. The first point is efficiency; alkaline stacks tend to have lower efficiency compared to newer technologies like proton exchange membrane (PEM) electrolysers. The second point is durability; alkaline electrolysers often use materials that can degrade the materials used in the electrolyser over time. The size and portability of an alkaline electrolyser need to be taken into consideration, they are typically larger and less portable compared to other hydrogen production methods. This can limit their use in certain applications where space and mobility are important factors.

When it comes to response to fluctuations, alkaline electrolysers have slower response times to changes in electricity input compared to some other electrolyser technologies. The last common criticism is regarding precious metals' dependency; alkaline electrolysers often rely on precious metal catalysts like platinum, which can be expensive and subject to market availability. This reliance on costly materials can drive up the overall production cost of hydrogen. 

Strategic Steps Toward Smart Supplier Diversification 

For executives and decision-makers in companies leveraging hydrogen technologies, here are some strategic steps to consider for effective supplier diversification: 

• Understanding the technology: Choosing between different technologies for hydrogen production will have a long-term impact on your operation, ensure you understand the options to make the best choice for your specific case. 
• Comprehensive supplier evaluation: Conduct a thorough assessment of potential hydrogen stack suppliers, considering factors such as reliability, quality standards, production capacity, geographical distribution, and financial stability. 
• Risk analysis and contingency planning: Identify potential risks associated with current hydrogen stack suppliers and develop contingency plans to mitigate disruptions. This involves mapping out alternative sources and establishing robust backup plans. 
• Collaborative partnerships: Foster collaborative relationships with multiple hydrogen stack suppliers, encouraging transparency, open communication, and joint initiatives to ensure alignment with your company's goals and standards. 
• Continuous monitoring and adaptation: Regularly assess the performance of diversified hydrogen stack suppliers, monitor market dynamics, and be agile in adapting to changing conditions to optimize the supply chain.

The Real Risks for EU companies when choosing non-EU Hydrogen Stack Suppliers 

As you evaluate hydrogen electrolyser manufacturers, you may come across foreign companies that offer competitive pricing and a wide range of products. While there are reputable foreign manufacturers in the market, it is essential to be aware of potential risks associated with this choice. The quality of products can vary widely across different manufacturers. Since standards often differ, not all may meet the stringent quality standards required for reliable and efficient hydrogen production. Due diligence is crucial to identify manufacturers with a proven track record of delivering high-quality systems. 

Sharing proprietary technology or processes with a foreign manufacturer can raise issues related to intellectual property protection. It is essential to have a clear understanding of the terms and conditions regarding technology transfer in any collaboration.  Furthermore, regulatory and compliance standards can differ significantly between regions, and foreign manufacturers may have different compliance requirements than those in the EU. Ensuring that the systems meet local regulations and safety standards is essential to avoid potential legal and operational complications. 

Effective communication is vital during the planning, implementation, and operation of a hydrogen electrolysis system. Language barriers and differences in business culture can hinder smooth collaboration. Manufacturers who have experience working with international clients and can provide clear, effective communication are preferable. And finally, global supply chain disruptions can affect the availability of critical components and materials. Make sure you understand the resilience of the manufacturer's supply chain and its ability to mitigate potential disruptions for smooth project planning and risk management. 

European Market Dynamics in Hydrogen Technology 

Europe has emerged as a frontrunner in embracing hydrogen technology as a key component of its ambitious clean energy transition. The European Union's strategic commitment to achieving carbon neutrality by 2050 has fueled substantial investments and policy initiatives in renewable energy sources, including hydrogen. Consequently, Europe presents a robust landscape for sourcing hydrogen stack suppliers of critical components like alkaline electrolysers. Here are some advantages of choosing to partner with a European supplier in the hydrogen industry: 

Proximity and accessibility: Establishing partnerships with hydrogen stack suppliers in Europe can offer logistical advantages, including reduced transportation times and costs. Proximity allows for faster response times, streamlined communication, and easier access to potential technology advancements and market insights. 

Leading technological innovations: European hydrogen stack suppliers often boast cutting-edge technological advancements and stringent quality standards in the production of hydrogen-related equipment. Engaging with these hydrogen stack suppliers provides access to state-of-the-art innovations and expertise that can drive efficiency and competitiveness in hydrogen production. 

Regulatory support and sustainability: The EU's stringent environmental regulations and sustainability mandates incentivise hydrogen stack suppliers in Europe to adhere to high environmental and ethical standards. Collaborating with these suppliers aligns with your sustainability goals and enhances your reputation as a responsible player in the green energy sector. 

Main Takeaways: 

In the dynamic landscape of the hydrogen industry, where innovation and sustainability drive progress, diversifying hydrogen stack suppliers of critical industrial parts like alkaline electrolysers emerges as a strategic imperative. By proactively spreading risks, unlocking innovation, enhancing operational resilience, and strategically diversifying hydrogen stack suppliers, your company can fortify its position and ensure a sustainable hydrogen partnership. 

As pioneers in providing cutting-edge equipment for hydrogen production, our commitment lies not only in delivering superior technology but also in empowering companies to navigate the complexities of the industry with confidence and foresight. Embracing the ethos of supplier diversification stands as a cornerstone in securing a sustainable and thriving future for the green hydrogen economy.