AFC Energy Announces New Hydrogen JV with Industrial Chemicals Group
Why we think this is good
The RNS announcement about the new joint venture between AFC Energy and Industrial Chemicals Group to produce hydrogen from ammonia is positive overall. The partnership leverages the strengths of both companies and has the potential to disrupt the UK hydrogen market without reliance on government subsidies. While there are some regulatory risks around permitting, the timeline to first revenues in early 2026 is relatively short. The agreement appears to have favorable commercial terms, and the financial impact could be significant. Overall, this is a positive strategic move for AFC Energy that should enhance its growth prospects.
Key Points
- 50:50 JV to produce hydrogen using AFC Energy's ammonia cracking technology
- JV to produce and sell hydrogen at a price to disrupt the UK market without reliance on government subsidies
- Initial revenues expected in early 2026, subject to permitting, generating up to 400kg/day of hydrogen
- JV to leverage ICL's ammonia procurement, logistics capabilities and customer base and AFC Energy's proprietary cracking technology
Summary
AFC Energy and Industrial Chemicals Group have agreed to form a 50:50 joint venture to produce hydrogen using AFC Energy's proprietary ammonia cracking technology. The JV is expected to generate initial revenues in early 2026, subject to permitting, and will leverage ICL's ammonia procurement and logistics capabilities along with AFC Energy's technology. The JV aims to produce and sell hydrogen at a price to disrupt the UK market without reliance on government subsidies.