Electrolysers
Chinese hydrogen electrolysers will capture at least one third of orders outside Europe and North America in 2025: WoodMac
Alkaline machines from China could also be attractive for developers in Europe that do not win European Hydrogen Bank grants, says analyst
Rendering of an alkaline electrolyser system produced by one of China's leading players, Sungrow.
Rendering of an alkaline electrolyser system produced by one of China's leading players, Sungrow.Photo: Sungrow
Published 13 December 2024, 15:44
Chinese companies will capture at least a third of electrolyser orders outside Europe and North America in 2025, according to analyst Wood Mackenzie.
“This expectation is based on several factors, including the increasing demand for green hydrogen and the competitive edge that Chinese electrolysers offer in terms of cost, manufacturing capacity, and shorter delivery times,” the company writes in a new report.
“Chinese OEMs [original equipment manufacturers] are ramping up production with over 10GW of new manufacturing capacity expected to come online in 2025, positioning themselves well for global expansion.
“Furthermore, their successful track record in markets like the Middle East, Southeast Asia, North Africa and Australia, coupled with their cost advantage, makes Chinese [electrolysers] an appealing option for projects in these regions.”
The report, entitled Hydrogen: 5 things to look for in 2025, adds that Chinese electrolysers “will play a role in European markets”, despite European Hydrogen Bank (EHB) rules preventing grant winners from sourcing more than 25% of their electrolysers from China.
“Despite this, there are opportunities for Chinese manufacturers, particularly if bid prices mirror the low numbers seen in the first [EHB auction] round,” it adds, pointing to the winning bids of between €0.37 and €0.48 ($0.39-0.50) per kilogram of H2.
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“This could make Chinese alkaline electrolysers competitive, with developers potentially opting for them over other options, bypassing the auction grant.”
However, WoodMac adds that “challenges remain” for Chinese electrolysers in Europe, “including concerns around after-sales service, geopolitical risks, and potential financing barriers for European developers”.
“As a result, Chinese electrolysers are likely to secure only smaller orders in Europe, typically in the 1-digit to 2-digit MW range, due to issues related to trust, brand recognition, and regulatory challenges.”
One of the Chinese-made electrolysers installed at the 260MW Kuqa green hydrogen project in Xinjiang, China.
'Chinese alkaline electrolysers are more expensive when exported — but still a quarter of the price of Western tech': WoodMac
Similar problems will happen in North America, the report adds, especially with uncertainty surrounding the incoming Trump administration’s actions on Chinese tariffs.
For these reasons, Chinese manufacturers are shifting focus to Southeast Asia, the Middle East and Latin America, WoodMac says.
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