The news: Clean energy startup Modern Electron is going all in on hydrogen — so much so that it’s changing its name to Modern Hydrogen and has stopped work on heat-to-electricity technology, its original focus, and shifted to making hydrogen fuel.
The Bothell, Wash.-based company on Thursday announced it has raised $32.8 million from investors to help fund and expand the transition.
The backdrop: Interest in hydrogen as a clean fuel has been booming in recent years, propelled by growing climate concerns and policy including last year’s Inflation Reduction Act and the planned creation of billion-dollar hydrogen hubs around the country.
“The willingness [of corporations] to adopt clean hydrogen — and generally all of clean tech — is very substantial,” said CEO and co-founder Tony Pan. “That’s very invigorating.”
The pivot: Modern Hydrogen is developing methane pyrolysis reactors that take natural gas from fossil fuels or biogas from sources like manure and strip off the carbon to make hydrogen. The hydrogen burns cleanly, producing water vapor as a byproduct. The fuel can be used for energy production, in industrial processes like steel manufacturing, and in fuel cells.
The reactors also produce a solid carbon substance called carbon black. The material is used to make goods including tires, rubber and ink. As pyrolysis operations multiply there will likely be a surplus of carbon black, so Modern Hydrogen is experimenting with adding it to concrete and asphalt as potential new products.
The twist: While there’s a huge push into hydrogen fuel production and the field is increasingly crowded, many companies are building large, centralized plants, Pan said. But one of the big challenges with hydrogen is that it’s expensive to move from production sites to where it’s used.
Modern Hydrogen is developing devices that are smaller, modular and intended for decentralized applications so the hydrogen gas won’t have to be shipped or piped to new locations. And the reactors are self-powered: in optimal conditions, about one-quarter of the hydrogen produced will be recycled back into the system to power the generation of more fuel.
The roots: Modern Electron started in 2015 at Intellectual Ventures, the Bellevue, Wash.-based innovation hub created by former Microsoft researcher Nathan Myhrvold that is also backed by Bill Gates. The startup’s original technology was devices that paired with home furnaces and hot water tanks to capture the appliances’ wasted heat and turn it into electricity.
But all of that experience was not wasted in the pivot. The team’s expertise in high temperature, thermal mechanical engineering and heat transfer has applications in this new space, Pan said.
“We are using a lot of the same deep tech,” he said. The startup has about 55 employees.
The funding: Modern Hydrogen’s new round was led by NextEra Energy — one of the world’s largest utilities — with strategic investors and partners Miura and National Grid Partners also participating. Investors from previous rounds including Gates Frontier, IRONGREY, Starlight Ventures, Valo Ventures and Metaplanet also contributed to the round.
The company has raised more than $100 million.
Next steps: The startup has pilot projects planned with NW Natural — Oregon’s largest natural gas utility — and another utility that Pan couldn’t name, but his hints suggest it’s NextEra Energy. Modern Hydrogen plans to ship its demo reactors, which will be the size of half a shipping container, to the utilities by the third-quarter of this year.
The company is also involved with a project to turn biogas from dairy waste into hydrogen, but the current focus is on the utility projects, Pan said.
The company is looking to establish a pilot manufacturing facility in the Seattle area.
It hopes to have commercial products available by late next year or early 2025.
