Utility Global, a Utah-based startup focused on solid oxide electrolyzer technology, claims to have received investment offers from oil majors after coming up with what it calls a hydrogen breakthrough.
The innovation is a new solid oxide electrochemical reactor design that Utility Global, a spinout from Utah research hub Hall Labs, says can be used to deliver blue hydrogen 30 percent cheaper and with 30 percent lower carbon emissions than traditional steam methane reforming.
Blue hydrogen is made from natural gas in the process of steam methane reformation, with the resulting emissions curtailed through carbon capture and storage. Blue hydrogen is one of several methods aiming to cut the carbon emissions associated with the industrial production of the gas. It is purportedly cleaner than the current industrial processes but still a long way from being zero-emission or "green" hydrogen, which is made using renewable power and electrolyzers.
Like the green variety, blue hydrogen is expensive to produce compared to the traditional carbon-intensive production processes used today. By reducing blue hydrogen's costs, Utility Global's technology could speed up hydrogen's much-vaunted replacement of fossil fuels.
Utility Global's bold claims sound reminiscent to much-hyped energy sector failures ranging from Solyndra to Faraday Grid. But multiple experts told GTM that Utility Global’s concept at least appears to stand up to scrutiny.
“Utility Global has a novel technique and a novel reactor design that looks promising in terms of reducing the cost and providing an alternative pathway to generating hydrogen,” said Ryan Milcarek, who reviewed the technology as an assistant professor at Arizona State University.
“The technology is based on solid oxide electrochemical reactions which are also utilized in conventional electrolysis,” Milcarek said. “Utility Global has an unconventional way of generating the hydrogen that differs from all current technology I am aware of.”
Another specialist, who asked not to be named, compared Utility Global’s concept to that being developed by listed U.K. firm AFC Energy, which has seen its share price rise this year amid growing interest in hydrogen as an alternative fuel.
A cleaner and cheaper way to make hydrogen?
Utility Global’s discovery centers on solid oxide fuel cells. These can act as chemical reactors as well as power generators, although so far most of the focus of technology development has been on the latter application, experts say.
Boiled down, “it's an efficient version of steam methane reforming that uses electrolysis to do the separation of the hydrogen rather than mechanical compressors and pressure swing adsorption [used in most blue hydrogen production processes],” Matt Dawson, Utility Global’s chief executive officer, explained in an interview.
“Instead of using electricity to separate off the hydrogen from all the other components, we use heat. Heat is a cheaper resource. That’s why we can be 30 percent cheaper and 30 percent more CO2-efficient. The architecture of our electrochemical device is unique.”
Dawson said Utility Global is hoping to use its technology to replace hydrogen production through traditional steam methane reformation, known as "gray" hydrogen — a $100 billion market.
Over the long term, Dawson said the company could also use solid oxide electrolyzer stacks to produce green hydrogen, although this would require very low-cost renewable energy supplies to be competitive on cost.
Utility Global has filed 60 provisional patents around its solid oxide fuel cell and electrolyzer technology, Dawson said. No patents have been granted yet. The technology has been tested at Arizona State University and is now undergoing further tests at the Department of Energy’s Pacific Northwest National Laboratory, Dawson said.
Relocating to Houston
“We’re scaling up and building a large-scale pilot,” said Dawson, whose resume includes stints at Equinor, ExxonMobil and Schlumberger. “We’re relocating to Houston, Texas so we can have Air Liquide and Exxon and Shell come and see this thing in action.”
The pilot plant, due to enter operation in the first quarter of next year, will produce 100 kilos of hydrogen a day, he said. The technology could be plugged into existing hydrogen production processes or used on a standalone basis wherever needed, he added.
Utility Global only developed the reactor design last year but has already attracted seed funding from Hall Labs and $5 million from a Houston-based investor, which is expected to last two years.
Since then the company has turned down investment offers from several Fortune 500 oil companies, Dawson claimed. “Our investor’s perspective on [the investment offers] was some of these companies may not have the greenest reputation and so maybe we don’t want to take them in — at least in this round.”
One factor adding to Utility Global’s credibility is its association with Pacific Northwest National Laboratory, where solid oxide fuel cell technology research is led by one of the world’s foremost experts on the subject, Subhash Singhal.
“From my perspective, the approach looks very promising,” Milcarek said. “The technology appears credible and promising based on the scientific principles involved and our evaluation of some aspects of the system.”
The technology also appears to be well equipped for scale-up, Milcarek said. ”Based on the evaluation I was involved with, I did not see any obvious drawbacks or challenges. More research and development will tell.”