Thyssenkrupp Nucera braces for delay in US hydrogen subsidy law.
Thyssenkrupp Nucera (NCH2.DE), opens new tab expects law it is relying on to subsidise green hydrogen to be delayed until after the U.S. presidential election, making it hard to predict how projects in the nascent industry will evolve, its CEO said on Tuesday.
Following the Ukraine war and Germany’s shift away from Russian gas, Berlin has focused on developing green hydrogen as an alternative energy source.
But the industry has been banking on tax credits from President Joe Biden’s Inflation Reduction Act (IRA), and his administration has yet to back up the outline law with detail.
Thyssenkrupp Nucera CEO Werner Ponikwar said the chance was “very low” that the legislation would be enacted before the November election, also flagging a potential risk that regulation could change under a new government.
Werner Ponikwar, Thyssenkrupp Nucera CEO, said:
And again I think this is one of those uncertainties that makes it for us very difficult to predict also how projects will move ahead in next year.
The impact is potentially huge in that the U.S. hydrogen generation market was estimated at $18.3 billion in 2023 and to grow to $31.4 billion by 2033, according to Precedence Research.
Thyssenkrupp Nucera, in which Thyssenkrupp (TKAG.DE), opens new tab holds a majority stake, last month scrapped financial guidance for its alkaline water electrolysis business division, saying ongoing uncertainty made a forecast impossible for now.
Still, equipment orders stood at 1.3 billion euros ($1.4 billion) at the end of June, up from 1.2 billion at the end of March, the company, which sells electrolysers, said on Tuesday.
Shares, which have more than halved since Thyssenkrupp Nucera’s listing last year, were up 2.4% at 0941 GMT.
Ponikwar played down the risk that parts of the IRA could be repealed in the event Donald Trump, who has voiced scepticism over some clean technologies, is elected as president.
Ponikwar said:
“I think that actually everyone also in the U.S. understands that we need to change here when it comes to the way how we produce and use energy,”
“I would not believe that someone will actually wipe that off the table now.”
But there is a risk a new government changes regulations, Ponikwar told journalists, adding that was why Thyssenkrupp Nucera’s was focusing on strategic investors rather than opportunistic project developers.
Project developers are more dependent on external funding than strategic players, such as industrial gases companies, which develop hydrogen projects on their own initiative, he said.
READ the latest news shaping the hydrogen market at Hydrogen Central
Thyssenkrupp Nucera braces for delay in US hydrogen subsidy law. source
