Gurjant Randhawa, the president and CEO of Toronto-based electrolyzer developer and manufacturer Cipher Neutron, intends to tackle two problems he sees as critical barriers to the process of making clean hydrogen fuel from water.

Cipher Neutron’s anion exchange membrane (AEM) is over 10 per cent more efficient than its competitors, Randhawa told Sustainable Biz Canada in an interview. At 94.4 per cent efficiency, it can overcome the problem of the high energy consumption needed to split water into hydrogen and oxygen, he stated.

Additionally, the company avoids the use of per- and polyfluoroalkyl substances (PFAS) and iridium in manufacturing. PFAS are chemicals being studied for potential links to environmental damage and health impacts. Iridium is a rare metal mined mostly from Russia and South Africa, and subject to supply chain constraints in Canada.

“Our electrolyzer that we developed does not use iridium, does not use PFAS, does not have depressurization issues,” Randhawa said.

It is also scalable, a “highly efficient system,” and affordable because it does not rely on iridium and instead has access to “so many supply chain options for us and we’re not relying on precious metals to make electrolyzers,” he added.

In the commercialization phase, Cipher Neutron is looking to release more powerful electrolyzers and advance on its “hydrogen battery” technology to complement its electrolyzers.

Creating a better electrolyzer

Co-founded by Randhawa, a mechanical engineer, Cipher Neutron offers an alternative to electrolyzers that use proton exchange membranes (PEM) and alkaline electrolysis.

Alkaline electrolyzers, Randhawa said, are bulky, have low effectiveness for their size and have spotty records producing green hydrogen because they work poorly with intermittent energy such as renewable energy. Though PEM electrolyzers are compact and efficient, they use PFAS and iridium and are also poor at working with intermittent energy.

Using its in-house catalyst and coating made from “abundant minerals” (which is kept a trade secret), Cipher Neutron’s AEM electrolyzer can avoid the use of PFAS and iridium.

Another key difference is efficiency. Though hydrogen has caught the attention of industries as a clean fuel, it is still largely made by reforming fossil fuels, producing greenhouse gas emissions and minimizing its decarbonization potential. Green hydrogen, made from water and clean electricity, is a low-carbon option, but is energy intensive to produce.

“More than 80 per cent of the cost of green hydrogen is based on your energy cost. Meaning that the cost of green hydrogen on the market is actually decided by how efficient your system is,” Randhawa said

A stack of Cipher Neutron’s electrolyzers reached 94.4 per cent efficiency in June, meaning 41.8 kilowatt-hours of electricity is needed to produce one kilogram of hydrogen fuel, according to a release. A stack of its hydrolyzers against a stack of its competitors showed Cipher Neutron was almost 15 per cent more efficient, the CEO said. The price of hydrogen can also be reduced by approximately 16 per cent using the same energy input, he added.

Such effectiveness can help overcome the cost and energy concerns with electrolysis, Randhawa explained.

Commercializing Cipher Neutron

At its facility in Toronto, Cipher Neutron has commercialized 10-kilowatt models and has sold units to Toronto-based FuelPositive, Taiwanese company Blade Hydrogen Technology Co. and Chilean miner Molymet.

Randhawa said the company is looking at a production capacity of up to 200 megawatts of electrolyzers per year.

Another goal is to produce larger electrolyzers. Cipher Neutron plans to release 50-kilowatt and 250-kilowatt models in 2025. A 250-kilowatt electrolyzer can produce between 110 to 115 kilograms of hydrogen per day, and be stacked up to 10 megawatts of production, he added.

Randhawa strongly believes the company will make approximately $7 million in revenue this year. Cipher Neutron is targeting end users or project managers “who want to go towards the green hydrogen transition and want to stay away from these harmful chemicals.”

Cipher Neutron plans to grow its existing Toronto facility. It is also closing a fund-raising round expected to end in August to expand production capabilities and gain working capital.

The company has a second product in the wings: a reversible fuel cell. Described as a hydrogen battery that stores the fuel in graphene slurry, Randhawa is confident Cipher Neutron can sell five- and 10-kilowatt hydrogen batteries for uses such as powering remote homes or back-up systems by the end of 2026 to early 2027.