Toyota Tsusho Corporation, Eurus Energy Holdings Corporation, and Iwatani Corporation have announced that they will jointly develop an on-site project model to produce and supply hydrogen using renewable electricity at customer sites. The project has been certified by the Ministry of Economy, Trade and Industry under the "Support Focusing on the Price Gap scheme based on the Hydrogen Society Promotion Act, which supports the use of low-carbon hydrogen, etc., for a smooth transition to a decarbonized growth-oriented economic structure."

The companies will proceed by discussing the start of an on-site low-carbon hydrogen production and supply project at Aichi Steel Corporation's Chita Plant in Tokai, Aichi Prefecture, aiming to commence operations around 2030.

Government Support and Regulatory Framework

The government has established a project plan certification system and support measures based on the Hydrogen Society Promotion Act, which came into effect in October 2024. The support measure focusing on the price gap provides a subsidy scheme that compensates for the gap between the production cost of low-carbon hydrogen and the existing prices of raw materials and fuels.

The price gap support scheme helps bridge the difference between the price of low-carbon hydrogen (standard price) and the price of existing raw materials and fuels (reference price) for 15 years, enabling certified low-carbon hydrogen suppliers to supply low-carbon hydrogen in accordance with their certified plan continuously. With institutional support by the government for the supply and use of hydrogen now fully launched, collaboration among relevant parties, mainly in the industrial sector, is expected to be further promoted, accelerating efforts toward the early realization of a hydrogen society.

Project Technical Specifications and Timeline

In this project, a water electrolysis system will be installed on the premises of Aichi Steel's Chita Plant. The system is planned to adopt the technology produced and sold by Chiyoda Corporation using Toyota Motor Corporation's stacks, which are the core system for electrolysis technology in hydrogen production. Using electricity from wind power plants owned by Eurus Energy, low-carbon hydrogen will be produced and supplied onsite.

At Aichi Steel, this hydrogen will be used in place of natural gas in some of the furnaces used for heating steel and iron materials. The three companies will establish a joint company in March 2027. After engineering and installing the equipment, they will build a system capable of producing and supplying approximately 1,600 tons of hydrogen annually, with operations expected to commence around 2030.

Strategic Objectives and Regional Impact

Through the project, the three companies will develop an optimal onsite low-carbon hydrogen production and supply model, and by enhancing the performance and functionality of water electrolysis technology, contribute to creating a hydrogen society promoted by the government. The project is positioned as an important initiative to promote the social implementation of hydrogen in the Chubu region.

As first movers, defined as business operators that plan to start supplying low-carbon hydrogen and ammonia in Japan by around 2030, the three companies will also collaborate with the Chubu Region Hydrogen and Ammonia Social Implementation Promotion Council to contribute to achieving carbon neutrality. The council was established in February 2022 to ensure that local governments and economic organizations work together to achieve the social implementation of hydrogen and ammonia in the Chubu region, aiming for carbon neutrality by 2050.

Company Profiles

Toyota Tsusho Corporation, established on July 1, 1948, is located at 4-9-8 Meieki, Nakamura-ku, Nagoya. The company is represented by Toshimitsu Imai, Representative Director, President & CEO. Its business description includes domestic trading of various goods, import and export trading, offshore trading, construction contracting, agency business for various types of insurance, and other businesses.

Eurus Energy Holdings Corporation was established on November 1, 2001, and is located at Otemachi First Square West Tower, 1-5-1 Otemachi, Chiyoda-ku, Tokyo. Tetsuya Suwabe serves as Representative Director, President & CEO. The company's business focuses on wind and solar power generation, storage, and sales. Iwatani Corporation, established on February 2, 1945, is headquartered at 3-6-4, Hommachi, Chuo-ku, Osaka, Osaka.

Hiroshi Majima serves as Representative Director, President & CEO, Executive Officer. The company operates in integrated energy, industrial gases, machinery, materials, and other businesses. Low-carbon hydrogen derived from renewable energy is expected to play a crucial role in achieving carbon neutrality by 2050. However, the production and supply of hydrogen still face many challenges in terms of cost and regulatory frameworks, posing barriers to its widespread adoption.

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