Hartford Business Journal

HARTFORDBUSINESS.COM | NOVEMBER 27, 2023 25 FOCUS: CLEAN ENERGY HyAxiom Director of Manufacturing James Skor speaks during a tour of the company's South Windsor facility. HBJ PHOTO | STEVE LASCHEVER Cleaner Energy Amid $150M capital raise, East Hartford fuel cell maker HyAxiom bets on growing hydrogen-based energy economy By Skyler Frazer sfrazer@hartfordbusiness.com D espite the Northeast region being largely left out of the Biden administration's regional fuel cell hub competition, which will provide $7 billion in funding to support the industry, officials at East Hartford-based HyAxiom Inc. say they're still bullish about the future as they develop new clean energy tech- nology and enter a key new market. On the heels of a $150 million private investment from three Korean investment firms, fuel cell company HyAxiom is developing electrolyzer technology that generates hydrogen by breaking up water molecules, while it moves away from some of its older product offerings. The company, which is an affiliate of South Korea-based Doosan Corp., has a manufacturing campus in South Windsor with corporate offices in East Hartford. It traces its roots to the former United Technologies Corp. (UTC), now part of defense giant RTX. HyAxiom has produced 1,200 fuel cell power plants across the globe, according to Director of Engi- neering Brian Chakulski, including several big projects in Connecticut. Namely, the company built a 460-kilowatt fuel cell for the Univer- sity of Connecticut, which was installed last year at UConn's Depot Campus in Storrs and generates electricity for research labs. It also has plants on the campuses of Western and Eastern Connecticut State universities. Key to HyAxiom's future growth prospects, company officials said, is the energy industry's pivot away from fossil fuels to a hydro- gen-based energy economy, with efforts underway in the U.S. and across the world to decarbonize the industrial sector. The Inflation Reduction Act of 2022 is helping to accelerate decarboniza- tion. In addition to the hydrogen hub funding, it offers the largest hydrogen subsidies in the world and excep- tionally high credits for hydrogen production, according to the National Resources Defense Council. Currently, 1,190 gigawatts of hydrogen electrolyzer projects are in development across the globe, up 24.3% from a year ago, according to Aurora Energy Research. "As the global economy transitions more to hydrogen, I think we're really well positioned for that because we're both on the production side, making hydrogen with these electrolysis units, and also the off-take side of hydrogen with our hydrogen power plant," Chakulski said. From UTC to Korea HyAxiom was founded in the 1960s by UTC. Early on, it provided fuel cells for NASA space missions, such as those in the Apollo program. Over time, UTC focused on stationary power plants and transportation fuel cells used on buses and other vehicles. UTC sold off its fuel cell division in 2013 to Oregon-based ClearEdge Power, which ran into financial troubles a year later and filed for bankruptcy. Doosan acquired the company out of bankruptcy in 2014. The company in recent years has focused on stationary power plant production, like the one installed at UConn's Depot Campus, said Chakuski, who previously worked at UTC. The fuel cells can run off natural gas, hydrogen or propane, and produce cleaner electricity compared to conventional fossil-fueled generation technologies. Fuel cells are used by an array of institutions seeking to reduce their carbon footprint, such as hospitals, hotels, data centers, universities, wastewater treatment facilities and municipalities, Chakulski said. "Combined heat and power is our specialty," he said. "The fuel cell reac- tion that occurs produces electricity and heat, and that heat is captured and delivered to the customer. A lot of our customers use this heat for things like space heating, or if there's a specific process that they have that requires heat." About a year ago, HyAxiom announced it was entering China's emerging power generation market, which Chakuski said offers growth opportunities. South Korea remains HyAxiom's biggest market, partly because that country offers significant clean energy incentives, something the company has lobbied for in Connecticut over the years. In the U.S., HyAxiom has taken advantage of clean energy invest- ment tax credits to grow its busi- ness, said David Giordano, head of government relations and business development. The company also participates in some state programs, like Connecti- cut's Statewide Shared Clean Energy Facility program. HyAxiom officials declined to disclose revenue figures or other financial information. Hurdles and hiccups HyAxiom has faced its share of challenges. In February, the company announced it was laying off 57 employees, or 19% of its overall workforce. HyAxiom CEO Jeff Hyungrak Chung said the layoffs were driven by an "adverse global economic situation coupled with impacts to the industry." At that time, the company said the South Windsor plant would no longer be used to make molded components, with HyAxiom instead opting to outsource some of that manufacturing. "We did have some reduction, but we've actually been hiring up and expanding back in different areas," said HyAxiom Director of Manufac- turing James Skor. HyAxiom is now back up to about 300 Connecticut employees, the company said, with room to hire several more engineers. Chakulski said one of the company's biggest challenges is competing with other energy sources — including natural gas and fossil fuels — on cost. Lowering costs to make the economics work better for customers is crucial, he said. In addition to outsourcing some manufacturing, HyAxiom is working to reduce operating costs by simplifying and standardizing fuel cell site instal- lations, and centralizing subassem- blies to create economies of scale, the company said. "There are other technologies out there that are lower cost, but we offer some advantages," including lower emissions and less noise, Chakulski said. A more recent hiccup was Connecti- cut's omission from the Biden admin- istration's hydrogen hub program,

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