SK, Plug Power launch JV to grab Asia’s hydrogen fuel cell market

SK Group’s city gas supplier SK E&S Co. said on Oct. 6 that it has officially kicked off the joint venture (JV) with the American hydrogen fuel cell maker Plug Power Inc., a plan that was originally announced in February this year.

The JV aims to take a dominant share of the fast-growing fuel cell market in Asia, said SK E&S. According to the deal between the two companies, signed at SK’s group headquarters in Seoul, the JV will be based in South Korea with SK E&S holding 51% of the shares and Plug Power the other 49%.

The JV by 2024 will set up fuel cell mass-production facilities near Seoul under the name of Giga Factory and R&D Center. The facilities will also conduct water electrolysis for the fuel cell production.

SK E&S said that Plug Power’s technical expertise will allow the company to cut the cost in manufacturing the cells and conducting electrolysis, which in turn will help the JV maintain price competitiveness in Asia.

The Giga Factory will be producing polymer electrolyte fuel cells in particular. This special type of fuel cells not only have high energy efficiency but also can operate at low temperatures.

Moreover, unlike the more traditional types of fuel cells that use liquefied natural gas (LNG) and liquefied petroleum gas (LPG) as the fuel, this type is a greener alternative as it injects hydrogen directly during the manufacturing process.

The JV will also be in charge of distributing the liquid hydrogen produced by SK E&S to more than 100 hydrogen charging stations across the country. SK E&S said that the JV will fuel further growth of the country’s hydrogen charging market.

“The JV is meaningful in that it will act as our stepping stone to the Asian market using Plug Power’s core technology. SK E&S will lead the creation of hydrogen ecosystem in Asia by producing green hydrogen with water electrolysis,” said SK E&S CEO Choo Hyung-wook.

Write to Jeong-min Nam at peux@hankyung.com
Daniel Cho edited this article.