L&T joins hands with French firm McPhy Energy to tap hydrogen market

Manufacturing major Larsen & Toubro (L&T) has signed an agreement with McPhy, a France-based electrolyser technology and manufacturing company, for building a “gigawatt (Gw) scale” manufacturing facility for electrolysers and tapping into the green hydrogen ecosystem in the country.

Speaking with Business Standard, Subramanian Sarma, whole-time director (energy), L&T, said the company is aiming at both green hydrogen and electrolyser sales through this partnership.

“We are looking at the value of green energy in the country and naturally we have started with manufacturing. We have identified electrolysers as a key value proposition,” said Sarma.

Under this partnership, McPhy will grant an exclusive license of its pressurised alkaline electrolyser technology to L&T for the manufacturing of electrolysers, including future product upgrades.

L&T plans to set up a Gw-scale manufacturing facility for electrolysers based on McPhy technology in India to serve the domestic requirements, as well as cater to other selected geographies, said the company.

This is L&T’s second such partnership with an electrolyser maker. In January last year, it signed a memorandum of understanding with HydrogenPro AS, a Norway-based electrolyser technology and manufacturing company.

Sarma said L&T will explore both the sale of electrolysers and green hydrogen through this manufacturing venture.

“We expect 6-7 Gw of electrolyser demand in the near term and it will only grow from there. Real growth will happen when the economics is favourable and the entire value chain is cost competitive — be it electricity cost, infrastructure, etc. We aim at providing a robust and reliable product, and cost will be competitive,” he said, adding that the company is expecting adaptation in the refinery, steel, and cement sectors, followed by the transport sector in the near future.

L&T in its public statement said the proposed agreement is in line with L&T’s strategic vision to be present across the green energy value chain and also furthers McPhy’s aim at expanding beyond the European market.

L&T in August last year announced the commissioning of a green hydrogen plant at its AM Naik Heavy Engineering Complex in Hazira, Gujarat. The plant will produce 45 kilogram of green hydrogen daily, which will be used for captive consumption in the company’s Hazira manufacturing complex.