Lhyfe, this French start-up that sees itself as a global giant in renewable hydrogen

A few hundred meters from the Bouin wind farm, on the Vendée, a new type of factory, which came out of the ground in 2020, is running at full speed. Powered by wind power and connected to the ocean, but not connected to the national grid, it has been producing approximately 300 kilograms of renewable hydrogen per day for almost a year, thanks to an electrolyser that decomposes water by an electric current. Compressed and then carried by truck, the precious molecule thus obtained supplies, a few tens of kilometers away, the forklifts of a Lidl logistics site, the Le Mans dump trucks, or even the bus of the nearby town of La Roche. -sur -Yon. Enough to limit the environmental footprint of mobility in the region, argues its operator, who believes, hard as steel, in the future of carbon-free hydrogen.

But there are no sector behemoths on the horizon: it’s a Nantes start-up, Lhyfe, created just five years ago, that operates the site-it’s the first. The latter offered him in 2021 a turnover of 197,000 euros… which the company aims to increase by ten over the next five years. By 2030, it even aims to have an installed capacity of 3 gigawatts (GW) equivalent to that of the EDF giant, which is now showing a desire to be “ a leader in carbon-free hydrogen “.

To give itself a way of its ambitions, the young shoot thus announced at the beginning of the week its listing on the Paris Stock Exchange, with the aim of increasing its capital from 110 to 145.5 million euros. While it has raised 76 million euros in the form of convertible bonds, ” of which approximately 47.8 million shares will be made on the day of settlement-delivery of the IPO “, he then specified, the total cost of the operation could rise to 193.3 million euros.

Actually, investors will have until May 19 to get the shares during an open price offer, even though Lhyfe estimates them to be between 8.75 and 11.75 euros.

Lhyfe is weaving its web in Europe

With this future capitalization, Lhyfe hopes to cover Europe. And planting its seeds everywhere, with at least 93 on-shore projects in the pipelines, which should open 4.8 GW of commercial pipelines here by 2028, ensures pure players. In particular, it is part of the GreenHyScale consortium, funded by the EU, which plans to install a new generation 100 MW electrolyser in Denmark by 2025, compared to just 1 MW for Bouin.

Last month, the start-up also announced that it had signed a memorandum of understanding with German energy company WPD for the establishment of a hydrogen production plant with a capacity of 600 MW (240 tonnes per day). , related to the Storgrundet offshore wind farm (1 GW), in Sweden.

And not only that: Lhyfe recently won a tender in Germany against Siemens to supply, by a production of 30 tons per year, Deutsche Bahn’s hydrogen trains … built by the Siemens group itself. It has also partnered with the renewable energy subsidiary of Portuguese giant EDP, which will be preferred supplier “.

The tricolor company is still looking beyond the Old Continent and announced in April that it had raised 10 million euros from Japanese conglomerate Mitsui with the aim of “ expand worldwide “. Thanks for this durable fabric, its The portfolio is almost five times larger than EDF in hydrogen “, Now welcomes its president, Matthieu Guesné.

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European subsidies

It must be said that the young shoot was sitting in a very large market. Because the whole world places a lot of hope on the massification of hydrogen, which will prove very important for decarbonizing mobility and industry, in addition to electrification processes. Especially since the war in Ukraine has greatly accelerated the process, especially for the European Union, which is trying in every way to limit the over-reliance on hydrocarbons from Russia. So, with its emancipation plan called REPowerEU to be unveiled next Wednesday, Brussels aims to double the goal of “green” hydrogen production set by its 2020 strategy! That is a production of 20 million tonnes per year by 2030, encouraged by strong subsidies.

“I strongly believe in‘ green ’hydrogen as the engine of our future energy system”, the Commission’s Vice-President, Frans Timmermans, even declared at a meeting with the Environment Committee of the European Parliament. Thursday, April 28.

However, the use of hydrogen is not new, especially in industrial processes from the development of synthetic fuels and petrochemicals to the manufacture of semiconductors.

But now almost all of the 10 million tonnes of hydrogen produced each year in the EU is made from fossil fuels, by steam methane reforming …

With its future electrolyzers directly connected to the wind and solar farm, Lhyfe therefore intends to carve out an area of ​​choice to replace “gray” hydrogen in the future mix, with more than 0.8% market share in European Union in 2050. Now that society must get this part “, We slipped in its ranks.

Carbon-free hydrogen: another “cliff to climb” for the tricolor sector

Offshore wind power at the heart of the strategy

However, the road will be long. While a kilo of “gray” hydrogen costs 1.90 euros to produce, the “green” equivalent, whose manufacturing process does not depend on fossil fuels, is now at 6 euros. But industrialization will greatly lower the costs of the latter, Matthieu Guesné assured, as hydrogen produced from methane will increase under the impact of carbon prices and declining demand. Until a convergence around 2030-2035, expect start-ups.

For the Bouin plant, we invested 10 million euros for 1 MW. But, for subsequent projects, it will be approximately 5 million euros, for five times as much hydrogen produced ! […] Especially since they are profitable from the first year of operation “, also emphasizes the entrepreneur.

So, while the company is suffering heavy losses, with a negative Ebitda of more than 5 million in 2020, its CEO expects a return to the green from 2026, and a long -term Ebitda margin of more than 30%.

More importantly, it relies on the very strong deployment of offshore wind power, ” key to the massification of green hydrogen for industry “, according to Matthieu Guesné. And for good reason, offshore parks can offer more abundant and slightly less intermittent electricity than their land counterparts, whose annual load factor is almost never exceeds 25%.

“Tomorrow, hydrogen will be produced at sea. And we will be the first to master offshore electrolyser technology,” promises the company’s founder, who has notably partnered with Chantiers de l’Atlantique.

By the end of the year, Lhyfe intends to put into production the first 1 MW offshore pilot site outside Le Croisic, in the Loire-Atlantique, which will have to deliver daily production of 400 kilograms of carbon-free hydrogen.

The 1 MW Plug Power electrolyser at Le Croisic.

Fruit of the brake

However, there will be many challenges before climbing. Because the establishment of new parks raises major problems of acceptance, from Oléron to Dunkirk, via Saint-Brieuc, so does France still lack (even though Saint-Nazaire has already begun to last its stage). Furthermore, the international situation could be stressful on the wind power industry, and hinder lower cost forecasts. Because the steel used for offshore towers currently sells for over 2,000 dollars per ton, or about three times more over the past few months!

The state of the supply chain is […] not healthy now […] because we have an inflationary market that exceeds what anyone predicted even last year “, alerted last month the general manager of GE Renewable Energy (French subsidiary of American General Electric), Sheri Hickok.

Especially since the electrons used to produce hydrogen, with the yield losses indicated by this chemical process, will represent less current available in the electrical network.

We will not have enough renewable energy to produce green hydrogen “, thus launched Emmanuel Macron at the end of 2021.

In dealing with this observation, many strategies are beginning to be developed. While the French government relies on an abundance of nuclear power to generate its local hydrogen, other states, such as Germany or Belgium, aim to import it significantly, sometimes from distant countries.

With this ecosystem in full construction, Lhyfe hopes to open up a third way: to approach consumption and production, but without relying on the atom.

Storage and transportation: the two main challenges of hydrogen deployment