Smoltek has the technology to make production of green hydrogen profitable and is seeking financially strong partners to scale up manufacturing of its nanomaterial

This press release is an English version of the previously published Swedish version, which has interpretive precedence.

Smoltek Nanotech Holding AB (“Smoltek”) has developed a new material that solves the major technical challenge that threatens to halt the fast-growing industry for green hydrogen produced by intermittent energy sources, such as solar and wind power. With the company's nanomaterial, the use of iridium (catalysts) in PEM electrolyzers can be reduced to levels that make large-scale hydrogen production profitable. The company is now seeking financially strong partners to realize part of the value in its subsidiary Smoltek Hydrogen and create the conditions needed to reach its target of a 30% market share, corresponding to approx. 20 billion SEK in net sales in 2030.

Green hydrogen, produced from fossil-free electricity is considered, both within the EU and globally, to be a key technology to manage the green transition. Currently, there are no other fossil-free alternatives for many industrial and shipping areas. Green hydrogen has the potential to become the leading solution for fossil-free steel production and heavy ocean freight.

 

When producing green hydrogen in large solar or wind farms, it is crucial to be able to quickly start and stop production. This process requires the specific PEM electrolysis technology, where the expensive and rare metal iridium splits water into hydrogen and oxygen. Unfortunately, the lack of available iridium risks making mass production of PEM electrolyzers unprofitable. This is due to today's overuse of iridium, as well as the fact that the price of iridium is forecast to rise significantly in the coming years.

 

Smoltek's nanomaterial – proven technology lead and a clear path to commercial manufacturing

Smoltek Hydrogen has developed a nanomaterial that has been proven to work well in long-term studies, and the company has a clear path to reach the goal of 0.1 mg of iridium per square centimeter, which Smoltek as well as the leading institute Fraunhofer consider to be the level at which large-scale manufacturing of PEM electrolyzers becomes commercially profitable. The company is not aware of any other industrially verified solution that is able to reach this tipping point.

 

To capitalize on this head start, Smoltek Hydrogen is now seeking financially strong partners to finance the remaining development and commercialization of the nanomaterial, including scale-up of production capacity. This process has been concretized with Smoltek's ongoing bidding process for Smoltek Hydrogen, as well as the subsidiary Smoltek Semi, which is expected to take 6–12 months. The company sees this process as crucial to being able to realize the value in Smoltek Hydrogen in both the short and long term:

 

• A sale of all or parts of Smoltek Hydrogen is expected to, relatively quickly, make visible the substantial underlying value in the entire company and its technology platform.

 

• Acquiring one or more financially strong partners who can finance the company until it starts to generate income will enable continued development together with customers and scale-up of production at a high pace

 

• The substantial long-term deal for Smoltek and its shareholders is the sale of the subsidiary Smoltek Hydrogen, which is expected to rise significantly in value once the company starts generating income.

 

• Furthermore, license income from parts of Smoltek's patent portfolio will generate income, i.e. when Smoltek Hydrogen sells material to its customers, Smoltek receives a certain share of it – and this will continue also after Smoltek has possibly sold the entire subsidiary Smoltek Hydrogen

 

• With greater financial resources, Smoltek Hydrogen sees the opportunity to better integrate the cell material with the other parts of a PEM electrolyzer, and thus offer a more optimized holistic solution to its customers. Furthermore, financial strength creates credibility as a counterparty in relation to industrial partners.

 

Ellinor Ehrnberg, President of Smoltek Hydrogen, comments:

“We have high ambitions as we are currently unique in providing a solution to a critical problem. Following the presentation of excellent long-term results, we have started to more firmly work towards becoming the electrolyzer manufacturers' collaboration partner for the next generation of electrolyzers. The interest from leading players is strong even before we have actively started to reach out to the market, and discussions and tests are already underway with a number of leading companies. Our target is to reach a 30 percent market share in 2030 together with partners, which would correspond to a turnover of approximately 20 billion SEK. And even if the projected sales volume is large, a giant factory plant is not required. But it is urgent to start building a pilot plant, because time is short. For that reason, the ongoing bidding process is an important step on the way there.”

 

Industrial production

During the next year, Smoltek Hydrogen plans to establish a pilot plant for small-scale industrial production to, together with customers, manufacture prototypes of new electrolyzers and, together with machine suppliers, be able to create the specifications for the first large-scale plant. There are several possible paths forward regarding volume production, but in a such a fast-growing industry it is not unusual to build up the business operations as an independent company, as an alternative to being part of a larger industrial structure.

 

Smoltek Hydrogen – Roadmap to 2030