Shell Shares Backtrack on Hydrogen Plan

A 20-megawatt hydrogen electrolyzer described as "one of the world’s largest" has begun operations, Shell (NYSE:RDS.A) said Friday.

Located in Zhangjiakou, Hebei Province, China, the electrolyzer will produce green hydrogen for fuel cell vehicles being used at Zhangjiakou’s competition zone during the Winter Olympics, which are due to open next Friday. Once the Games finish, commercial and public transport will use the hydrogen.

In a statement, Wael Sawan, Shell’s integrated gas, renewable and energy solutions director, said the electrolyzer was "the largest in our portfolio to date."

"We see opportunities across the hydrogen supply chain in China, including its production, storage and shipping," Sawan said.

The facility in China is linked to a joint venture established in 2020 between Shell China and the Zhangjiakou City Transport Construction Investment Holding Group Co. Ltd.

Hydrogen, which has a diverse range of applications and can be deployed in a wide range of industries, can be produced in a number of ways. One method includes using electrolysis, with an electric current splitting water into oxygen and hydrogen.

If the electricity used in this process comes from a renewable source such as wind or solar then some call it green or renewable hydrogen. The electrolyzer in Zhangjiakou will use onshore wind power, Shell said.

While there is excitement in some quarters about green hydrogen’s potential, the vast majority of hydrogen generation is currently based on fossil fuels.

Shell shares docked 15 cents to $50.96.