On Wednesday, Albuquerque-headquartered on-site hydrogen producer BayoTech announced that it has received an indirect equity investment from Caterpillar Venture Capital, the corporate VC arm of the heavy equipment manufacturer, via U.S.-Dutch seed-stage disruptive tech investor Cottonwood Technology Fund.
Amid the ongoing enthusiasm for the promise of hydrogen as a low-carbon fuel source, most hydrogen is still produced at large, centralized facilities before being delivered to end users, which diminishes some of the carbon savings versus conventional fossil fuels. BayoTech, through its distributed hydrogen and “Gas-as-a-Service” offering, called BayoGaaS, reduces or eliminates transportation and storage costs, which it says results in less energy wasted and an even lower carbon footprint than traditional hydrogen production technology and electrolyzer-based systems.
The company says its modular hydrogen production systems require less upfront capital, are easy to site and install, when paired with renewable natural gas, offer the most cost-effective green hydrogen available today.
BayoTech serves a diverse set of end users, including traditional consumers in the industrial gas and chemicals industries, as well as those using hydrogen to power the fast-growing fuel cell segment.
“It’s a strong sign of market acceleration when well-established corporations recognize the important role hydrogen will play in decarbonizing industry,” said BayoTech President Mo Vargas. “Cottonwood Technology Funds has been a great partner to BayoTech and continues to play a key role in aligning us with investors to drive our long-term growth.”
“Caterpillar Venture Capital’s investment illustrates a recognition that hydrogen has great potential to help with the energy transition as Caterpillar moves forward. We are excited to be an investor in BayoTech,” said Caterpillar Venture Capital Vice President Michael Young.
GreenCore deal
Earlier this month, BayoTech announced a deal with GreenCore, a maker and distributor of North American EV charging stations, to supply hydrogen to the more than 1,500 EV charging and hydrogen and refueling stations that GreenCore plans to roll out by 2026.
The charging stations will use hydrogen fuel cells to generate electricity to charge battery-powered vehicles, while reducing reliance on the grid and competition for energy at peak demand times. These sites will also dispense hydrogen directly to fuel light- and heavy-duty fuel cell vehicles.
Research from Canalys, provided by BayoTech, shows that EV sales increased by 39 percent in 2020 to 3.1 million units, with a further 66 percent increase expected in 2021. This continued growth will further increase the enormous demand on the grid, requiring extensive investment to upgrade the distribution network that can take years to complete.
“As the demand for EV charging grows, serious issues in peak energy pricing and remote energy access are emerging,” said GreenCore CEO Frank Baumann. “This exciting partnership allows GreenCore and BayoTech to present a solution to these issues today, eliminating tailpipe emissions and making electric car charging more accessible.”
