Climate Fund issues up to €10 million capital loan to Hycamite for the promotion of clean hydrogen and industrial carbon production
Hycamite's energy-efficient and emissions-free process produces hydrogen from methane gas for use as a raw material in the chemical industry or as marine fuel, among other things. The solid carbon generated by the process can be used for various applications, for example in the battery industry, or as composite and filter materials. During the start-up phase, the production will be based on biogas.
”Our process uses roughly 13% of the amount of energy needed to produce the same amount of hydrogen with the electrolysis process. In the current energy crisis, our solution will play a major role in the energy- and cost-efficient replacement of the grey hydrogen used by industry with emissions-free hydrogen. We are also developing new applications for both our hydrogen production technology and the solid carbon created as its end product. Our partnership with Wärtsilä is an example of the former, with our technology producing hydrogen fuel from LNG on Wärtsilä's vessels. This avoids the methane emissions generated by LNG combustion, alleviates the challenges of storing hydrogen on board, all while leveraging the existing LNG fleet”, says Hycamite's CEO, Laura Rahikka.
The Climate Fund’s contribution to the funding of the demonstration plant accelerates the development of this technology, expedites the industrial transition away from grey hydrogen and towards emissions reductions, and boosts the development of the Finnish hydrogen cluster. If Hycamite’s business plan is realised in full, the solution could have a cumulative ten-year emissions reduction potential of 85 million carbon equivalent tonnes.
”Hycamite's solution diversifies the hydrogen project offering and replaces grey hydrogen in industrial applications. I see an interesting role in the hydrogen economy for it. The carbon from the feed gas used in the process is recovered in solid form and can be used for a variety of applications”, says CEO Paula Laine of the Climate Fund, further highlighting the impact of the solution.
Hycamite TCD Technologies Oy (Hycamite) was established to commercialise the University of Oulu’s research into producing hydrogen and high-quality carbon for industrial processes.Hycamite's solution generates ‘turquoise hydrogen’ produced from natural gas or biogas in an emissions-free process, with solid carbon as a by-product.
The technology enables the production of emissions-free hydrogen from biogas, natural gas or synthetic methane. During the start-up phase, the demonstration plant's production will be based on biogas, directly or via certification. The technology is based on the thermo-catalytic decomposition (TCD) of methane molecules with sustainable raw materials. As a novel carbon capture, utilisation and storage technology (CCUS technology), the solid carbon generated by the process could be used as a raw material in industrial processes.
The company’s total emissions reduction potential will depend on the number of commercial plants and their hydrogen and carbon production capacities, as well as on the ability of the end products to replace currently used industrial raw materials. The Climate Fund’s emissions reduction potential was estimated by replacing ‘grey hydrogen’ produced with fossil fuels with emissions-free hydrogen. The emissions-reduction potential would be realised in industry, i.e. mostly in the emissions trading sector, and the cumulative estimate includes the scale-up of operations to a global level with significant additional investments.
According to this estimate, each kilotonne of hydrogen produced with Hycamite's technology will reduce emissions by approximately 13,7 kt CO2eq. The ten-year emissions reduction potential of the demonstration plan being built in Kokkola is 0.2 Mt CO2eq. If the company's ambitious business plan is realised, it could achieve a theoretical ten-year cumulative emissions reduction potential of up to 85 Mt CO2eq.
When biogas is used as the plant's input, which can be calculated as emissions-free, the solid carbon produced in the process can be considered a carbon sink, depending on its use. For example, if the carbon produced in the process is used in concrete, the carbon is removed from the natural cycle and the emissions reduction corresponding to this removal could in principle be calculated according to the emissions reduction potential of the process.According to estimates, this could generate an additional theoretical emissions-reduction potential of up to 8 Mt CO2eq.
The demonstration plant's estimated funding need is €28 million, for which Hycamite will collect €15 million in equity funding from private investors in addition to the Climate Fund's loan. Business Finland has also approved €2.4 million in research, development and piloting support funding for the project.
The Climate Fund's up to €10 million capital loan has a market-based interest rate determined according to the risks of the project and in line with the EU's minimum interest rate requirements. The capital loan also includes a convertibles option with a separate sustainability-linked incentive for achieving emissions reductions above the anticipated baseline.
Hycamite TCD Technologies produces clean hydrogen and industrial-quality solid carbon by splitting methane using proprietary zero-emission technology. The disruptive and IP protected process developed by Hycamite is based on the thermo-catalytic decomposition (TCD) of methane molecules. Hycamite’s production is environmentally friendly. There are no emissions into the atmosphere and the catalysts used are sustainable. The background of Hycamite's new technology lies in the University of Oulu's long-term applied chemistry research. Hycamite is a privately owned company headquartered in Kokkola, Finland.
Saara MatteroCommunications and Sustainability DirectorTel:+358 400 114 777Saara.Mattero@ilmastorahasto.fi
Laura RahikkaCEOHycamiteTel:+358 40 723 firstname.lastname@example.org
About Ilmastorahasto Oy
The Finnish Climate Fund is a Finnish state-owned special-assignment company. Its operations focus on combating climate change, boosting low-carbon industry and promoting digitalisation. The Climate Fund invests in large-scale projects in which the fund’s investment is crucial to enable the project’s realisation in the first place, on a larger scale or earlier than it would with funding from elsewhere.
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