ImpactAlpha, October 11 – European governments are intensifying their efforts to reduce their reliance on Russian hydrocarbons – and to hit their targets for reducing greenhouse gas emissions. That’s fueling demand alternative transportation fuel such as clean hydrogen, which is used to power fuel cells.
Hydrogen-focused investment manager Hy24 Partners has closed a €2 billion ($1.94 billion) fund to support the development of hydrogen fuel infrastructure in the Americas, Europe and Asia. The fund will invest at all points of the clean hydrogen supply chain, from renewable and low-carbon hydrogen production to investments in hydrogen-powered transportation fleets and refueling stations.
Hy24 is a joint venture between private equity investor Ardian and green hydrogen investor FiveT Hydrogen, which in April 2021 raised €260 million to invest exclusively in green hydrogen production, storage and distribution.
Industrial might
The fund is the cornerstone of what Hy24 calls an ecosystem of investors that it claims has the capacity to put 10 to 15 times the fund’s value to work on projects around the globe.
Participants in the fund include industrial companies, banks, pension funds and insurance companies, including South Korea’s Lotte Chemical, TotalEnergies, Baker Hughes, Airbus, Crédit Agricole Assurances and Allianz.
“The diversity of our investors and our ability to leverage Hy24’s strong deal flow will put us in a unique position to grow this industry at scale into a decisive asset class,” Hy24’s Laurent Fayollas said in a statement.
Hy24 has already begun deploying capital. In March, it led a $122 million raise for Berlin-based H2 Mobility to help it build a 300-facility network of hydrogen fueling stations across Europe by 2030. A month earlier it participated in a €200 million raise for Germany’s Hy2gen to build facilities for producing green hydrogen fuel for sea and ground transportation, aviation and industrial applications.
On trend
The €2 billion raise comes on the heels of a string of hydrogen-related deals. In September, Paris-based Mirova – the impact unit of French asset management firm Natixis Investment Managers – raised $1.5 billion for its energy fund whose cleantech portfolio includes green hydrogen projects. And Green Hydrogen Systems, a maker of electrolyzers that split hydrogen from water molecules, raised €28 million in late 2020 to help it meet growing demand for green hydrogen production technology.
In September, the U.S. Department of Energy announced a $7 billion grant program aimed at funding the development of clean hydrogen infrastructure.
