South Australian-based Sparc Technologies (ASX: SPN) has entered into a binding agreement with global green energy company Fortescue Future Industries (FFI) to advance the development of green hydrogen technology.
The partners will form a joint venture company known as Sparc Hydrogen and will be granted the exclusive licence to develop and commercialise the next-generation technology originally created by the University of Adelaide and Flinders University.
The technology is based on the production of commercially-viable green hydrogen using only sunlight and water (photocatalytic water splitting coupled with solar radiation) instead of renewable energy and electrolysis.
Adopting this process means that renewable energy from wind farms and/or photovoltaic solar panels and expensive electrolysers are not needed.
Capital and operating expenditure is anticipated to be significantly lower than electrolysis and other forms of hydrogen production currently in use.
The new technology could potentially be adopted remotely and for on-site use, thereby reducing the reliance on long distance hydrogen transportation and electricity transmission.
Under the terms of the binding agreement, FFI (a subsidiary of Fortescue Metals Group, ASX: FMG) will make an initial stage one investment of $1.8 million to earn a 20% interest in Sparc Hydrogen.
At stage two, FFI could spend a further $1.47 million for a total investment of $3.27 million over 4.5 years to earn a 36% interest.
Sparc Hydrogen has also entered into a research agreement with the University of Adelaide in respect of stage one, triggering an initial payment of $962,000 from Sparc Technologies to Sparc Hydrogen and then to the University of Adelaide.
The payment will go towards Sparc Technologies’ stage one funding commitment and approximately $512,000 will be reimbursed by FFI’s contribution.
FFI chief executive officer Julie Shuttleworth said the company is keen to support critical research into green hydrogen.
“Green hydrogen is a practical and implementable solution to decarbonise hard to abate sectors, including heavy industry,” she said.
“The research being undertaken by Sparc Hydrogen is important for [our] growing technology portfolio as we develop technologies to lower emissions globally.”
Capability and expertise
Sparc executive chairman Stephen Hunt said FFI will bring a high level of capability and expertise to support the project.
“We are extremely excited to be working with a company of the calibre of FFI, which has demonstrated its credentials as being a world leading company in green hydrogen,” he said.
“We believe FFI is very well placed to assist the development and commercialisation of Sparc Hydrogen’s green hydrogen photocatalytic technology.”