Everyone is taking about it, but hardly anyone has it. What we are referring to, of course, is green hydrogen, meaning hydrogen produced from clean electricity. This energy-rich gas can be used to fuel buses, trains or industrial plants in a way that is climate neutral. Hydrogen will also be hugely important as a raw material for the chemicals industry in the future. The German government has already announced its hydrogen strategy. The aim of that strategy is to promote and expand the corresponding technologies in Germany.
But where is this green hydrogen supposed to come from? The involvement of private-sector companies plays a key role in this respect. French start-up Lhyfe, founded in 2017 and listed on the Euronext stock exchange in Paris since 2022, is one of the first companies to rise to this challenge on an industrial scale. “We produce green hydrogen and sell it directly to the customers”, says Luc Graré, Head of Central and Eastern Europe at Lhyfe.
Lhyfe has already set up four production locations. Three of those are in the company’s home country of France. They have a capacity of between one and five megawatts. However, the company built the largest plant of its type, with more than 200 employees, in Baden-Württemberg ‒ in Schwäbisch Gmünd to be precise. Plant operations commenced in May 2025 with a capacity of ten megawatts.
Ideal conditions for expanding into THE LÄND
Baden-Württemberg offers a favourable environment for investments in the area of renewable energy. One of the state’s policy objectives is to build a sustainable hydrogen sector – to cover everything from production to transportation and consumption. The state is providing funding for this development and bringing stakeholders together – for example on the platform H2BW.
Green hydrogen is produced using electrolysis. The energy needed for this process is provided by electricity generated by water, wind and solar power. The hydrogen produced is collected and can be stored or used directly. It sounds easy, but the technology behind the process is complex – particularly when large volumes of green hydrogen need to be produced at costs that are as low as possible.
The location chosen by Lhyfe is situated in the Aspen technological park southwest of Schwäbisch Gmünd. The proximity to the site makes it possible to supply the companies there with green hydrogen directly. The town and its municipal authorities welcomed the French company with open arms and gave it permission to use an industrial site of 10,000 square metres in size. This was what allowed the project to be realised. “The politicians at a municipal level were passionate about moving forward with the project. That helped us a lot”, says Graré.
Location advantages through funding and partnerships
Funding available from the federal state also played a role. Lhyfe is benefiting from the cooperation project H2-Wandel (Hydrogen For Innovative Vehicles), introduced by the Mittlere Alb-Donau-Ostwürttemberg region. The project is centred around building a technological ecosystem based on green hydrogen. Directly adjacent to the Lhyfe location, there are also plans for a hydrogen filling station and a H2 pipeline. Additional funding is provided by the European Regional Development Fund (ERDF).
There is also a sufficient supply of renewable energy. Lhyfe has entered into long-term Power Purchase Agreements (PPA) with providers of wind, solar and hydro power in order to purchase the energy required for the electrolysis process sustainably.
In collaboration with the company KEYOU, Lhyfe is planning to use up to 100 hydrogen trucks in the region around Schwäbisch Gmünd. KEYOU’s idea is to convert traditional diesel engines into zero-emission hydrogen engines at a low cost.
Baden-Württemberg offers lots of good opportunities, Graré explains. For example, the federal state is a centre for research into fuel cells, i.e. drives that are powered by green hydrogen. “Baden-Württemberg is the Silicon Valley for mobility, which makes the location so interesting for us”. That’s how the Lhyfe manager sums up the situation.
