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Hexagon Purus’s Clean Energy Revolution Unveiled in Exclusive Interview with CEO Morten Holum – A 2024 Vision

In the fast-paced world of automotive innovation and sustainable energy solutions, Hexagon Purus – under the leadership of CEO Morten Holum – is leading the charge towards a cleaner, greener future. In an exclusive interview with Automotive Industries, Holum unveils the strategic investments from industry giants Mitsui and Hy24, which are set to turbocharge Hexagon Purus’s growth in the coming years.

 

As Holum asserts, 2024 will be a pivotal year for Hexagon Purus, marked by the ramp-up of capacity at five newly opened facilities across the globe. From Westminster to Weeze, from Kelowna to Kassel and Ålesund, and with a new site in Dallas and Shijiazhuang, China on the horizon, Hexagon Purus is strategically positioned to meet the escalating demand for zero-emission mobility solutions. These state-of-the-art facilities signify not just a physical expansion but a commitment to meet growing customer demand and drive innovation in the zero-emission mobility.

 

The partnership with Mitsui and Hy24 isn’t just about financial backing; it’s about leveraging their expertise and networks to catalyze the entire clean hydrogen value chain. With Mitsui’s long-term investment perspective and Hy24’s specialized knowledge in hydrogen infrastructure, Hexagon Purus is ready to play its part in realizing the hydrogen economy, driving sustainability and profitability hand in hand.

 

Holum’s vision extends beyond mere business objectives; it’s about realizing a cleaner, more sustainable energy future for generations to come. Hexagon Purus’s purpose to be a driving force for a sustainable planet is underscored by its commitment to advancing zero-emission mobility on a global scale. From transit buses to heavy-duty trucks, from rail to maritime applications, Hexagon Purus’s leading-edge technology can help reshape the landscape of clean energy transportation.

 

Moreover, with the upcoming Spring 2024 auction of the European Hydrogen Bank, Hexagon Purus is well positioned to capitalize on emerging opportunities and contribute to the growth of the European hydrogen market. The company welcomes an increasingly supportive regulatory environment and financial instruments that can support a nascent industry while recognizing that the only way for hydrogen to play a role long-term is if it becomes a profitable, commercial business.

 

In summary, Hexagon Purus has an unwavering commitment to scale up to meet customer demand, deliver efficient and cost-effective solutions, and to drive sustainability, securing its position as a market leader in zero-emission mobility and infrastructure segments globally.

 

Automotive Industries interview with Morten Holum, Chief Executive Officer, Hexagon Purus

 

Automotive Industries: Hi Morten, how do you see the strategic investments from Mitsui, Hy24, and Hexagon Composites contributing to Hexagon Purus’s growth strategy and global expansion plans?

 

Holum: First of all, the proceeds will support our growth strategy, including our ongoing global capacity expansion program and delivering on the commitments in our customer programs.  2024 will be an important year for Hexagon Purus to ramp up capacity at five new facilities as we prepare for serial production and execute on our strong backlog. We will also continue to build our organization to deliver on our customer commitments.

 

The five new production facilities are in Westminster   (Germany) and Ålesund (Norway).  In addition, we are opening a new facility in Shijiazhuang (China) and a new site in Dallas (Texas, USA) in mid-2024.

 

Beyond proceeds, the strategic alliance with Mitsui and the new strategic partnership with Hy24 will give us access to their industrial expertise and their vast industrial networks.

 

Automotive Industries: With the support of Mitsui and Hy24, how does Hexagon Purus plan to leverage their financial and industrial expertise to scale up its global manufacturing capacity and become a catalyst for the entire clean hydrogen value chain?

 

Holum: A lot of companies are now struggling to secure sufficient growth capital. We’ve been fortunate to have solid strategic partners like Mitsui who think and invest long-term. This benefits us a lot, not just from a capital perspective but we also benefit from their knowledge and networks – using the industrial knowledge and commercial network that Mitsui has to connect the dots, bring parties together and get things moving.  Mitsui´s effort to support and lift the ecosystem is valuable because no single party can do this alone – we all depend on each other.

 

Hy24 belongs in that same category, so getting them in as a strategic partner is super valuable.  They are a specialist asset management company investing across the entire hydrogen value chain, and currently managing the world’s first and largest fund dedicated entirely to the deployment of clean hydrogen infrastructures, with over EUR 2 billion under management.

 

Besides capital, Hy24 brings a lot of expertise on hydrogen from their own strong industrial profiles and operating partners, with backgrounds from companies like Siemens, Alstom, and Air Liquide, and they also have a large ecosystem of partners, including approximately 50 investors from the industrial and financial worlds.  We are confident that we can benefit from our strategic partnership with Hy24.

 

Automotive Industries: Hy24 mentioned that this investment reinforces its position as a strategic investor fostering the clean hydrogen economy. Could you elaborate on how this aligns with Hexagon Purus’s vision for a cleaner energy future?

 

Holum: Our purpose is to be a driving force for a sustainable planet.  There is not one ‘silver bullet’ that will solve the climate crisis; different sectors will need different technologies to help them transition away from fossil fuels and towards lower- and zero-emissions alternatives.   Hydrogen is among the solutions which will help us decarbonize and decentralize energy production. There is no pathway to a net-zero society without hydrogen.

 

Automotive Industries: As a world-leading provider of hydrogen cylinders and systems for various vehicles, how does Hexagon Purus envision its role in advancing zero-emission mobility on a global scale, especially with the ongoing demand for cleaner transportation solutions?

 

Holum: We are well-positioned to meet the rising global demand for zero-emission fuels and technologies, with a particular focus on the transport sector. We are rapidly expanding our capacity and global presence to meet anticipated demand and maintain our market-leading position. We now have more than 650 employees working in eight strategically important locations across three continents (Europe, North America and Asia).  As mentioned, we have opened five brand new manufacturing facilities in the last twelve months, and we are in the process of preparing another two facilities in China and Dallas that are scheduled to open in 2024.

 

We are pleased that the regulatory environment for clean mobility continues to be supportive.  In California, the Advanced Clean Truck and the Advanced Clean Fleet regulations will result in significant growth for zero emission vehicles in the coming years.  Together these two pieces of regulation are effectively addressing both the supply and the demand side of the equation. This will result in significant growth for zero emission vehicles in California and the 13 or so other states adopting similar regulations as California on zero-emissions vehicles.

 

Having said that, the energy transition appears to be going slower than most people expected a few years ago. The availability of green hydrogen is significantly lower than needed, and a large portion of new hydrogen capacity is directed towards industrial uses. This has delayed the inflection point for hydrogen in the mobility space.

 

If it were to summarize how we see the development for different mobility applications, I would say that transit bus is at an early commercial stage with proven technology driven by demand for public zero-emission transport solutions. We have a strong recurring customer base in Europe and were recently selected for the fourth consecutive year as supplier to New Flyer, which is the largest bus manufacturer in North America.  Transit is an ideal application for hydrogen, and we expect additional growth here in the coming years.

 

When it comes to BEV heavy-duty trucking – there are strong regulatory drivers for adoption for zero-emission trucking in the US.  Vehicle electrification is already playing a key role in ensuring lighter vehicles can run on electricity instead of diesel or petrol. Battery-electric vehicles are helping to drive down emissions and reduce air pollution.

 

For FCEV heavy-duty trucking,  is leading the way with the first on-road fuel-cell electric heavy duty offering in the US, and more OEMs will be bringing FCEV vehicles to market in the coming years.

 

Rail is a promising segment for hydrogen with high energy demand and predictable routes easing refueling planning and set up.

 

Maritime is also promising – there are several maritime classes that are in the sweet spot for hydrogen, including passenger fast-ferries, coastal merchant vessels, inland river vessels, and service vessels for sectors like offshore oil & gas, offshore wind and aquaculture.

 

Automotive Industries: Mitsui expressed confidence in Hexagon Purus’ technology offering. Could you highlight some key aspects of Hexagon Purus’s technology that you believe sets it apart in facilitating the transition to a zero-emission society?

 

Holum: We have over six decades of high-pressure composite cylinder manufacturing experience. We pioneered the introduction of Type 4 technology for hydrogen mobility in 2006. The liner in our cylinders is made of a polymer material, which means they are ultra-light. They are also very corrosion resistant and are suitable for harsh climates. Our hydrogen systems based on our Type 4 cylinder technology are used in a variety of zero-emission infrastructure and mobility applications, and this technology offer several advantages to other technologies.

 

Hydrogen has traditionally been transported using steel tube trailers with type 1 steel cylinders.  Using Type 4 cylinder technology, we can make larger modules that store hydrogen at much higher pressure, with less weight, all of which increases the storage capacity.  Our Type 4 based modules typically carry three times the amount of hydrogen compared to a steel tube trailer.  And in a distribution business, it´s all about payload.  Higher payload drives down the unit cost in a way that more than offsets the higher cost of our technology.

The total cost of ownership for a Type 4 module is superior to that of a steel tube trailer, almost regardless of consumption and travel distance. Triple capacity can mean running one trip instead of three. Lower OpEx more than offsets the higher CapEx for our modules compared to steel-based modules.  This is why the industrial gas companies are now increasingly shifting to Type 4 based modules – and why the emerging green hydrogen players are starting with this technology right off the bat.  This is why we are seeing such a high growth in demand for our modules.

 

Part of the reason for our success so far is this deep competence in the technology that we’re now applying to new applications, which creates a lot of synergy.

 

When it comes to our battery electric technology, our high-voltage battery pack technology is known for its industry-leading efficiency – we have the most energy-dense battery pack per any given length of frame rail space, which is a key metric that aligns with the packaging needs of medium & heavy-duty commercial vehicle applications. We also offer complete electric vehicle and drivetrain integration for BEVs.

 

Automotive Industries: Hy24’s Clean Hydrogen Equipment Fund is making its first investment with Hexagon Purus. How does this partnership align with both organizations’ goals and contribute to the mature and pivotal hydrogen technologies essential for decarbonizing industry and mobility sectors?

 

Holum: This investment reinforces Hy24’s position as both a strategic investor and as a catalyst in fostering the clean hydrogen economy. It demonstrates the Equipment Fund’s commitment to scale up the capacity for the manufacturing and production of the mature and pivotal hydrogen technologies and equipment that are essential to decarbonizing industry and mobility sectors.

 

Automotive Industries: With the upcoming Spring 2024 auction of the European Hydrogen Bank, how does Hexagon Purus plan to position itself to capitalize on potential opportunities and contribute to the growth of the European hydrogen market?

 

Holum: The bottleneck today is in the availability of molecules. The technology for mobility is already here.  The world’s big subsidy programs, the US Clean Hydrogen Production Credit, the EU’s green H2 auctions, the German-led H2Global scheme, and the UK’s Contracts for Difference tenders, have all been taking longer to reach fruition than expected, delaying final investment decisions (FIDs) but I’m hopeful that we’ll start to see more subsidies in place making more  large-scale projects financially realistic and then we should see more FIDs following this year.

 

So we expect to benefit both from the growth in the number of hydrogen projects and new rafts of regulation.

 

Automotive Industries: Considering the supportive regulatory environment, what role do you see Hexagon Purus playing in advocating for policies and financial instruments that can further propel the hydrogen revolution, not only in Norway but globally?

 

Holum: We participate in industry associations, but we are not advocating as a standalone company for specific policies and financial instruments – as a scale-up, we have to leave that to bigger companies with more resources.  It’s clear that governments and regulators need to provide incentives in the early stage and then it’s up to the industry to industrialize and scale. The only way for hydrogen to play a role is if it becomes a profitable, commercial business. It cannot live on subsidies for years and years.

 

Automotive Industries: Hexagon Purus has achieved market-leading positions in various zero-emission mobility and infrastructure segments globally. How does the company plan to maintain and expand these positions, and what upcoming developments can we expect in terms of Hexagon Purus’s product offerings and market presence?

 

Holum: Success with customers is crucial, so the most important thing we do is to deliver on our customer programs – we need to deliver high quality, predictably and consistently.  Then we need to scale up our business to drive down the cost of our technology.  This is important to make the technology competitive, not just vis-a-vis competitors but also compared to other technologies. In the end, it needs to make sense commercially for customers.

 

We now have a presence in the three largest and most attractive geographies for zero emission mobility – Europe, North America and Asia.  We also have a technology platform which is relevant in a wide range of infrastructure and mobility applications, and a broad and solid product offering.  In the short term, we do not expect to expand to new geographies or further broaden our product portfolio.  Our main focus is to deliver well on existing customer programs and to scale up the business so we can drive costs down and drive profitability up.

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