Tesla Mega packs, giant hydrogen tank: Panasonic’s new climate factory

As bullet trains whiz past at 285 kilometers per hour, Panasonic’s Norihiko Kawamura looks over Japan’s tallest hydrogen storage tank. The 14-meter structure hangs over the Tokaido Shinkansen line tracks outside the ancient capital of Kyoto, as well as a vast array of solar panels, hydrogen fuel cells and Tesla Megapack storage batteries. The power sources can generate enough juice to run part of the manufacturing site using only renewable energy.

“This could be the largest hydrogen consumption site in Japan,” said Kawamura, a manager at the device maker’s Smart Energy System business division. “We estimate to use 120 tons of hydrogen per year. As Japan produces and imports more and more hydrogen in the future, this will be a very suitable type of plant.”

Panasonic’s factory in Kusastsu, Shiga Prefecture, is a sprawling 52-hectare site, between a high-speed rail line and expressway. It was originally built in 1969 to produce goods including refrigerators, one of the “three treasures” of home appliances, along with TVs and washing machines, that Japanese coveted as the country rebuilt after the devastation of World War II.

Today, one corner of the plant is the H2 Kibou field, a demonstration sustainable power facility that began operating in April. It consists of a 78,000 liter hydrogen fuel tank, a 495 kilowatt hydrogen fuel cell array consisting of 99 5kW fuel cells, 570kW of 1,820 photovoltaic solar panels arranged in an inverted “V” shape to capture the most sunlight capture, and 1.1 megawatts of lithium-ion battery storage.

On one side of the H2 Kibou field, a large screen indicates the amount of power produced in real time from fuel cells and solar panels: 259kW. About 80% of the power generated comes from fuel cells, with solar power accounting for the rest. Panasonic says the facility produces enough power to meet the needs of the site’s fuel cell factory – it has a peak power of about 680 kW and an annual consumption of about 2.7 gigawatts. Panasonic thinks this could be a template for the next generation of new, sustainable manufacturing.

“This is the first manufacturing site of its kind to use 100% renewable energy,” says Hiroshi Kinoshita of Panasonic’s Smart Energy System Business Division. “We want to extend this solution to the creation of a decarbonized society.”

An energy management system (EMS) equipped with artificial intelligence automatically controls on-site power generation, alternating between solar and hydrogen, to reduce the amount of electricity purchased from the local grid operator. For example, if it is a sunny summer day and the fuel cell factory needs 600 kW, the EMS may prioritize the solar panels and decide on a mix of 300 kW of solar, 200 kW of hydrogen fuel cells and 100 kW of storage batteries. On a cloudy day, however, this can reduce the solar component, and boost the hydrogen and storage batteries, which are recharged by the fuel cells at night.

“The most important thing to make manufacturing greener is an integrated energy system that includes renewable energy such as solar and wind, hydrogen, batteries and so on,” says Takamichi Ochi, a senior manager for climate change and energy at Deloitte Tohmatsu Consulting. “To do this, the Panasonic example is close to an ideal energy system.”

With gray hydrogen, not quite green yet

The H2 Kibou field is not entirely green. It depends on so-called gray hydrogen, which is generated from natural gas in a process that can release a lot of carbon dioxide. About once a week, tankers haul 20,000 liters of hydrogen, cooled in liquid form to minus 250 Celsius, from Osaka to Kusatsu, a distance of about 80 km. Japan has relied on countries such as Australia, which have larger supplies of renewable energy, for hydrogen production. But local supplier Iwatani Corporation, which together with Chevron earlier this year to build 30 hydrogen fuel sites in California by 2026, opened a technology center near Osaka focused on producing green hydrogen, which is created without the use of fossil fuels.

Another issue delaying adoption is cost. Even though electricity is relatively expensive in Japan, it currently costs much more to run a plant with hydrogen than to use power from the grid, but the company expects Japanese government and industry efforts to improve supply and distribution to significantly boost the element will make cheaper.

“Our hope is that hydrogen costs will drop, so that we can reach something like 20 yen per cubic meter of hydrogen, and then we will be able to achieve cost parity with the electric grid,” Kawamura said.

Panasonic also expects that Japan’s effort to become carbon neutral by 2050 will increase demand for new energy products. Its fuel cell factory at Kusatsu has produced more than 200,000 Ene-Farm natural gas fuel cells for home use. Commercialized in 2009, the cells extract hydrogen from natural gas, generate power by reacting it with oxygen, heat and store hot water, and provide up to 500 watts of emergency power for eight days in a disaster. Last year, it began selling a pure hydrogen version aimed at commercial users. It wants to sell the fuel cells in the US and Europe because governments there have more aggressive hydrogen cost-cutting measures than Japan. In 2021, the US Department of Energy launched a so-called Hydrogen Shot program that aims to reduce the cost of clean hydrogen by 80% to $1 per 1 kilogram over 10 years.

Panasonic does not plan to expand the scope of its H2 Kibou field for now because it wants to see other companies and factories adopt similar energy systems.

It wouldn’t necessarily make economic sense today, says Kawamura, “but we want to start something like this so that it will be ready when the cost of hydrogen drops. Our message is: if we want 100% renewable energy in 2030, then we have to start with something like this now, not in 2030.”