Cummins Inc. and China Petrochemical Corporation have formed a 50:50 joint venture called Cummins Enze Hydrogen Technology Co., Ltd.
Through greater technological innovation, research and development, and manufacturing capability, the joint venture will expedite the cost and availability of green hydrogen.
Cummins Enze, headquartered in Foshan, Guangdong Province, China, would initially invest $47 million (RMB 300 million) in the establishment of a production facility for proton exchange membrane (PEM) electrolyzers. After completion in 2023, the plant’s initial manufacturing capacity of 500 megawatts of electrolyzers per year will be gradually increased to one gigawatt per year over the next five years.
Cummins Enze will also offer a range of hydrogen generating system options to fulfill the needs of a diverse range of applications. This will comprise electrolyzers for both small-scale hydrogen production, such as a hydrogen fueling system for on-site hydrogen generation, and large-scale hydrogen generation facilities capable of 100 megawatts or more.
“China’s embrace of green hydrogen is a breakthrough for the planet, and Cummins and Sinopec joining together to realize the potential of green hydrogen is a huge leap forward for scaling our innovative PEM electrolyzer systems,” said Amy Davis, Vice President and President of New Power at Cummins. “Cummins was one of the first multinational companies to establish an entity in China in 1979, and we are thrilled to now use our deep roots and localized expertise to be at the forefront of the country’s energy transformation. This joint venture brings together Cummins’ and Sinopec’s innovative spirits and pursuit of a more sustainable tomorrow, enabling a carbon-free economy.”
“Green hydrogen is the ultimate technology of the hydrogen energy industry in the future,” said Zhou Yuxuan, General Manager of Enze Fund and Chairman of the joint venture. “Both gray and blue hydrogen technologies (gray hydrogen with carbon capture technology) are just a transition. We will use Sinopec’s current industry resources and lay out the green hydrogen industry chain to achieve greater progress.”
Sinopec is one of China’s leading hydrogen energy suppliers, with yearly hydrogen output reaching 3.5 million tons, accounting for 14% of the country’s total. Sinopec established the ambition of becoming the world’s leading chemical company focused on clean energy last year and designated the entire hydrogen industry chain as the primary business for its new power strategy. Sinopec has stepped up its efforts to convert gray hydrogen to decarbonized hydrogen, with the goal of becoming “China’s largest hydrogen energy firm.” Commercializing renewable hydrogen in China is expected to benefit not only green sectors, but also reduce hydrogen supply bottlenecks, hence accelerating fuel cell car adoption.
Cummins has a long history of developing innovative technology and technical capabilities, including a broad array of market-leading renewable hydrogen generating technologies, such as PEM electrolyzer and fuel cell systems. The company has installed over 2,000 fuel cells and 600 electrolyzers globally to date. Cummins electrolyzers have powered numerous world “firsts,” including the world’s first megawatt-scale demonstration plant for storing wind energy in the natural gas grid in Windgas Falkenhagen, Germany; the world’s first hydrogen refueling station for ships, cars, trucks, and industrial customers in Antwerp, Belgium; and the world’s largest PEM electrolyzer in Becancour, Canada.
Sinopec has a solid industrial foundation and an integrated value chain as a significant industrial resource for hydrogen energy. Sinopec develops the complete service capability of oil, gas, hydrogen, and electricity and seeks consumer-oriented breakthroughs to accelerate the energy revolution of the industry chain. As Sinopec’s inaugural fund, the Enze Fund will also use Sinopec’s supply chain optimization, sales and marketing network to expedite the joint venture’s future commercial growth.
The joint venture’s new factory will be built in Foshan, China, which is a national ecological basis for the hydrogen energy industry. It boasts a mature hydrogen energy industry chain as a pioneer of the hydrogen economy. Additionally, it is one of the first regions identified by China’s central government for support in order to test and build the hydrogen sector.
China has emerged as one of Cummins’ most rapidly developing regional markets. By 2020, the business expects to have shipped 670,000 engines to Chinese clients. The company’s ties to China trace all the way back to 1975, when former Chairman J. Irwin Miller made a trip to the country. Miller’s idea has been aggressively pursued by subsequent Cummins leaders through investments and business alliances in China. Cummins operates 30 locations in China, including 21 manufacturing sites that manufacture Cummins engines, turbochargers, filters, emission solutions, fuel systems, alternators, and electrical power generation systems. Cummins China entities now employ more than 10,000 people.
