A decade ago, China used low prices to dominate solar manufacturing, wiping out Western competitors just as worldwide demand for panels started to soar. The US and Europe are determined not to let the same thing happen with hydrogen.
“I’ve heard too many government officials say we cannot repeat the experience of solar again,” said BNEF hydrogen analyst Xiaoting Wang. Meanwhile, many analysts expect the efficiency of Chinese electrolyzers to improve, eroding any technological advantage US and European companies now have. The devices come in several varieties, each with its pros and cons. Chinese companies mostly produce “alkaline” electrolyzers that have low up-front costs but need more electricity than competing technologies to yield each kilogram of hydrogen. US and European companies focus on “solid oxide” and “proton-exchange membrane” electrolyzers that have a higher initial cost but need less electricity—a big selling point in places where electricity is expensive.
Meanwhile, state-owned PERIC received orders in 2022 from seven foreign countries, including Australia, the US and Korea, according to BNEF. Shandong Saikesaisi Hydrogen Energy, one of the few Chinese manufacturers to specialize in PEM, now gets about 10 percent to 15 percent of its sales from overseas, said Huang Fang, a project director of the company. It’s aiming to improve that percentage amid demand from Europe and Australia, Huang said.