Can Atlantic Canada’s H2 strategies compete in a global 'squared circle'?

Hydrogen:

Can Atlantic Canada’s H2 strategies compete in a global 'squared circle'?

Analysis/Commentary by Brian McLaughlin

(This is the original long-form, and my final, Third Commentary on Hydrogen, published in BNI's Telegraph Journal online, and within its other in print daily and weekly broadsheet newspapers across New Brunswick.)

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”

― Sun Tzu, The Art of War

Atlantic Canada’s public- and private-sector Hydrogen initiatives and strategists should heed the wisdom of The Ancient Chinese General (“Master Sun”) as we prepare to battle our global rivals.

All four provinces believe they have the will to compete in Hydrogen’s global "squared circle". But can they master the means to win industrial scale green energy business?

And does Atlantic Canada really know who it’s up against? Internationally, countries with near-bottomless pockets are ambitiously investing in hydrogen, wind, and solar.

Know the enem(ies)!

Communist China (CCP) – as the world’s second fastest growing economy, where coerced economic and social harmonies build mega-energy and other infrastructure projects in mere-weeks versus months-and-years by western standards – is outpacing its own five-year targets with wind energy and solar objectives, even outpacing US and EU goals. The Peoples Republic of China is on course to hit wind and solar power targets five years ahead of time. Also, a recent Center for Strategic and International Studies (CSIS) article stated: The Communist regime released the country’s first-ever long-term plan for hydrogen, covering the period of 2021–2035.

At about 33 million tons (Mt),?China’s the world’s largest hydrogen producer. China’s long-term plan builds on hydrogen-related visions and plans, including the 14th Five-Year Plan (2021–2025), where hydrogen is identified as a “frontier” area and one of the six industries for expansion.

China’s $13.4 trillion GDP and 5.2 percent Annual GDP Growth Rate is second only to the US’s $20.49 trillion GDP and its 1.6 percent Annual GDP Growth Rate. In comparison, Canada’s $2.14 trillion (U.S. dollars) GDP comes last in a-field-of-ten, by 2023 GDP countries rankings. Our annual growth rate is predicted to be 1.3% in 2023 and 1.5% in 2024.

Back to hydrogen, then.

(Atlantic) Canada against China? It’s akin to (four) dwarfs rushing up against a Sumo!

Saudi Arabia is sparing no expense: recently announcing investment at Oxagon, the world’s largest green hydrogen plant, being built by NEOM Green Hydrogen Co. – a joint venture between ACWA Power, Air Products and the $500-Billion giga-project.

United Arab Emirates recently invested $1.3 Billion in industrial projects, including that country’s first hydrogen electrolyzer fuel plant.

And even developing nation *South African is investing $4.6 Billion in the renewables and hydrogen gamble. In Nelson Mandela Bay, in the Eastern Cape of South Africa, thousands of hectares of land could one day become the world’s largest green ammonia plant. Projected to start operations in 2026, the plant will be powered by a nearby solar farm and will get its water — of which vast amounts are needed to make ammonia — from a local table salt factory that desalinates seawater. (*Note: this energy news MSN/CNN update was added with a July 25, 2023 news link that was published after my original long form commentary/analysis was created.)

It's a fiercely competitive global cage match for hydrogen!

Know yourself

Atlantic Canada’s business leaders appear ready for battles.

But is it enough?

“This partnership between Qalipu First Nation and DOB-Academy is integral to ensuring the workforce is trained for Project Nujio’qonik and other green energy projects in the region.” Sean Leet, Managing Director and CEO at World Energy GH2, Board Chair at Horizon Maritime Services.

Armed with industry sector strategies, our C-suite leaders are travelling to hydrogen trade shows (Europe World Hydrogen Summit 2023 in Rotterdam, NL), and across North America (World Hydrogen North America 2023) and further to strike silo-to-silo deals and sign memorandums of understanding to partner with like-minded corporate elites. Partnerships are slowly advancing.

Examples of recent successes are Qalipu Holding Limited Partnership (QHLP) (Canada), the business investment arm of Qalipu First Nation, and DOB Academy (Netherlands), a renewable energy education centre based in Delft, Netherlands, signing a partnership agreement at World Hydrogen Summit 2023 in Rotterdam, Netherlands. It’s a collaboration to develop first-of-its-kind green energy training in Newfoundland and Labrador.

Sean Leet, Managing Director and CEO at World Energy GH2, Board Chair at Horizon Maritime Services, states: “This partnership between Qalipu First Nation and DOB-Academy is integral to ensuring the workforce is trained for Project Nujio’qonik and other green energy projects in the region.”

Also, Belledune Port Authority (BPA) just signed a MOU agreement with Port of Rotterdam – Europe’s largest seaport, and world's largest seaport outside of East Asia. It’s a major strategic and logistics accomplishment for BPA. Previously, BPA inked a MOU with the German-based Port of Wilhelmshaven to collaborate moving clean fuels and green products.

“The business case for making hydrogen through the electrolysis process using Newfoundland’s wind resource is very compelling.” Frank Davis, Assistant Vice President, Pattern Energy Group LP, senior representative for Pattern Energy in Canada.

Port of Argentia (POA) and Pattern Energy have partnered to advance The Argentia Renewables Project, a major initiative expected to require a capital investment of over $4 Billion USD.

Does POA’s renewables project rank it to be a global contender in hydrogen? Frank Davis, Assistant Vice President, Pattern Energy Group LP, senior representative for Pattern Energy in Canada, thinks so. He says: “The business case for making hydrogen through the electrolysis process using Newfoundland’s wind resource is very compelling.” He's convinced it presents a better business case than places like the Middle East or Australia, which both require significant desalination processes for the requirement of fresh water in the electrolysis process. Davis believes it translates into better economics in terms of the wind energy project.

However, research and development into green hydrogen production is advancing rapidly, as countries ante up to make big bets on clean, net zero fuels.

Merely flaunting our region’s abundant fresh water, excess wind capacities, post-secondary academic STEM knowledge assets, year-round “ice free” port logistics, and our closest proximity to Europe as our vital “invest in Atlantic Canada” pitches might not be enough.

We must also consider how quantum advances in chemical engineering are proving Australia, China, and other Middle East nation’s R&D and investments are closing in on abilities to cheaply produce hydrogen from sea water, and harvest saleable quantities of chlorine and battery-grade lithium. Australia's vast renewable energy potential and export-focused economy positions it well to compete at high volumes internationally.

Currently, hydrogen and green ammonia energy are big across the EU and northern Europe. Consider the European demand and growing market space for electrolyzers, critical technology required to turn reacted hydrogen into green ammonia.

According to 2023 published THEnergy data, increasingly large-scale electrolyzer factories (0.3GW (Gagawatt)+) are being commissioned throughout Europe and rapidly across the globe. For Europe, THEnergy?hydrogen map shows Germany as the nation with the highest total of either commissioned or operational electrolysers, 38.65 MW total. Denmark, Finland, Netherlands, Sweden, Spain, Austria, Switzerland, are also active in electrolyzers growth and innovations.?

However, *China brings a no contest powerful mastery of current and future landscape for both already "built" and planned GW capacity electrolyzer factories. (*Note: Hydrogen News intelligence was added with a July 25, 2023 link that was published after my original long form commentary/analysis was created.)

Given these fluid innovations, global activities and clean energy investments, and evolving demands, Atlantic Canada’s objection-handlings like pitching our abundant fresh water, or 'the high capex investment' required in the desalination process with H2 are quickly becoming moot assets to venture capitalists.?

‘Master Sun’ might advise cohesive, caginess to become our superior power.

Furthermore, in terms of knowing ourselves and any others (allies or rivals), consider some obvious 'demands' in relation to our unique advantages: such as the requirements of external SME’s and H2 energy sector partners from EU prospects and other overseas external project developers and venture capitalists looking to establish partnerships with internal (Atlantic Canada) project partners, SMEs, and venture capital partners.

These external (EU) SME’s and project developers will desire, and need, to engage and establish partnerships with internal (Atlantic Canada) SME’s – aligning with matching project developers in their niche industry spaces.

Why are SME's critical when looking to EU markets to acquire aligned silo-to-silo partnerships with Atlantic Canadian SME's? Small and medium-sized enterprises?(SMEs) represent 99% of all businesses in the EU. The definition of an SME is important for access to finance and EU support programs targeted specifically at these enterprises.

Moreover, contemplate our current recessionary economy. For some of those SME’s and potential H2 project partners, distance, limited resources and budgets, and the physical logistics of 'transatlantic separation' will present impediments in terms of making face-to-face contact, transacting immediate commerce, business networking, and/or any abilities to build partnership connections a challenge in conducting global business within the short window of opportunity between 2025 (and 2030) – when Germany expects it will need clean fuel via a "transatlantic supply chain" shipping industrial scale ammonia for German (and EU) off taking.

“We prioritize First Nations engagement, ensuring these communities are engaged in meaningful ways,” states Rory Cantwell, CEO of WEB’s Halifax-based subsidiary SWEB Developments.

Or, what of other external (EU) SME entrepreneurs and H2 experienced businesses that will need to negotiate Canada’s Indigenous files – and fast track to learn about the implications of UNDRIP on sustainable energy initiatives and projects? They’ll need to know how to build reciprocal wealth-sharing and community partnerships with First Nations communities across all four provinces.

So, consider this: when it comes to the advantages of existing brain trust and renewables engineering innovations and Indigenous relations expertise, company CEO’s like Halifax-based Rory Cantwell of SWEB Developments already proffer C-suite leadership experience ?– ?plus SWEB’s rank-and-file employees evince indigenous cultural sensitivities, awareness, passion and commitments.

SWEB's track record of recent successes in building reciprocal partnerships with First Nations communities across NB and NS with existing wind turbine electricity generation systems offers our region a clear edge, which needs to be accessed and leveraged to our advantage.

“We prioritize First Nations engagement, ensuring these communities are engaged in meaningful ways,” states Rory Cantwell, CEO of WEB’s Halifax-based subsidiary SWEB Developments, a company specialized in wind generation and solar renewable energy solutions. The parent company W.E.B. is an Austrian community-owned energy transition company, with approximately 600 MW of renewable energy across Europe and North America.

SWEB’s Atlantic Canada projects represent a significant chunk of the parent company’s global renewable energy generation. They operate approximately 100 MW of wind and solar projects across Atlantic Canada and the US northeast, with another 95 MW in late-stage development in Nova Scotia, and approximately 3,500 MW of projects in earlier stage development throughout North America.

SWEB recently won a federal government $25 Million grant to build 16 wind farms for Gloosecap First Nation and Gloosecap Energy for its Weaver Mountain wind farm initiative in Nova Scotia.

Despite Cantwell’s confession that hydrogen project (wind turbine) initiatives are not part their current corporate strategies, he understands how it’s easy to get excited about them.?He explained because the world is amid an energy transition, requiring significant scale up in order to be brought into reality, it will require not only more electricity, but older power plants (and other existing energy infrastructure) to be refurbished or decommissioned – simultaneously while “there’s a need to reduce carbon emissions”.

“So, there’s an opportunity for MEGA projects to be realized,” Cantwell says. He anticipates Atlantic Canada is a desirable location to have hydrogen and ammonia projects because of “high wind speeds and proximity to markets in high demand for such clean fuels.”

"We're very happy with the results from our (two-year) pilot reactor. It's exceeded our expectations for the efficiency of coupling microwave energy with the catalyst bed." As a result Nu:ionic's unique reactor design offers significant advantages to small-to-medium scale low carbon hydrogen production in a distributed fashion, overcoming key challenges associated with distributing hydrogen. Jan Boshoff, co-founder and CEO of Nu:ionic Technologies, a hydrogen gas innovator and start-up.

Another successful edge is how New Brunswick-based start-ups are stepping up with innovative solutions that offer more immediate solutions to the Climate Crisis.

Nu:ionic Technologies is a Fredericton-based start-up that's commissioning new technology for significantly reducing the carbon impact of producing hydrogen using microwaves. Employing first-of-its-kind microwave reformer process, Nu:ionic utilizes industrial microwave technology to eliminate combustion of natural gas, producing low-carbon hydrogen from natural gas with 100 percent capture of the associated carbon dioxide and no need for combustion carbon capture. The conversion process also requires almost five times less electricity per unit mass of hydrogen produced when compared to electrolysis, allowing more efficient use of renewable electricity resources.

Nu:ionic co-founder and CEO Jan Boshoff states: "We're very happy with the results from our (two-year) pilot reactor. It's exceeded our expectations for the efficiency of coupling microwave energy with the catalyst bed." As a result Nu:ionic's unique reactor design offers significant advantages to small-to-medium scale low carbon hydrogen production in a distributed fashion, overcoming key challenges associated with distributing hydrogen.

Plus, as a result of these early-stages of success, Nu:ionic is rapidly advancing from pilot to demonstration to commercial scale.??Boshoff anticipates – with a great degree of certainty – that the company will be deploying at 1 tonne / day hydrogen capacity and up starting in 2024.

Furthermore, in terms of offering a low capex business case, Nu:ionic's hydrogen can utilize existing infrastructure. Its hydrogen alternative innovation can be scaled up and brought into play utilizing existing pipeline infrastructures across much of the US and Canada landscape. So, what with the decommissioning and abandonment of Sable Offshore Energy Project natural gas producing fields, it offers viable clean fuel which can also flow through repurposed infrastructure previously built for transporting natural gas from offshore Nova Scotia, across New Brunswick, and through the New England states to larger and feasible consumer energy markets in the Northeastern USA.

Global business acumen requires tapping into these accessible and available knowledge banks of private sector-to-First Nations partnerships and other first-of-a-kind hydrogen innovation start-up success stories, which can assist in fast-tracking knowledge intake critical to attracting international venture capital and accelerate industrial sized scale up, while also assisting SME’s abilities to become globally competitive and rapidly undertake critical infrastructure- and construction-based projects.

Simply 'provincially' pitching our unsynchronized regional merits – and the all too relevant status-quos of four provinces cross-competing – without alerting our senses towards what our larger hydrogen rivals are undertaking and investing in, as well as becoming attuned to what's happening in our own camps, could lead to many self-inflicted defeats!

And yet, if global awareness, infused with interprovincial alliances via comprehensive, harmonized, and cohesive acceleration can become our advantage, we 'four' dwarfs might be nimble enough to be first to scramble over the top – despite our unintimidating size.

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Brian McLaughlin bio –?Brian McLaughlin?(Brian McLaughlin Consulting & Associates)?is a business coverage and energy topics freelance researcher, writer, marketing, and energy?sectors analyst, and consultant aligned with a global suite of environmental, bioregional trade advocates, and Earth Ethical marcomm associates, specializing in contemporary online communications, events, integrated multimedia campaigns, virtual expo’s, virtual exhibits, and international networking, business development, marketing and exporting trade initiatives.?