AFC Energy’s 2025 Gamble: How Ammonia Cracking Unlocks Hydrogen Fuel Cell Commercialization

Industry Adoption: AFC Energy’s Strategic Pivot to On-Site Hydrogen Production via Ammonia Cracking

Between 2021 and 2024, AFC Energy validated its alkaline fuel cell technology across a diverse range of high-profile pilot projects, demonstrating its potential to decarbonize off-grid power. The company successfully deployed its H-Power generators in demanding environments, from powering Extreme E’s all-electric off-road racing series to providing zero-emission energy on construction sites for industry giants like Mace and Kier Group. These deployments proved the technical viability of displacing diesel generators but also exposed a critical bottleneck: the complex and costly logistics of hydrogen supply. While partnerships with companies like Air Products secured hydrogen, the reliance on transported gas remained a significant barrier to widespread adoption. This period was defined by proving the power generation technology while simultaneously identifying the fuel supply chain as the primary obstacle to commercial scale.

The landscape shifted dramatically in 2025 as AFC Energy moved from identifying the problem to aggressively engineering the solution. The company’s strategic pivot to commercial viability by 2026 is anchored by a dual-pronged assault on cost and fuel availability. Recognizing hydrogen logistics as a core challenge, AFC launched the Hy-5, a portable ammonia cracking module capable of producing 500 kg of hydrogen per day on-site. This technology was productized under a new “fuel as a service” (FaaS) model, offering hydrogen at a target price of approximately £10/kg. This strategic move to vertical integration was validated through critical partnerships, including a 50:50 joint venture with Industrial Chemicals Group (ICL) to produce and sell hydrogen from ammonia in the UK and a Joint Development Agreement with an unnamed S&P 500 industrial giant to advance cracker technology. This inflection point transformed AFC Energy from a fuel cell provider dependent on external fuel sources into an integrated energy solutions company, creating a self-contained ecosystem to accelerate adoption.

Table: AFC Energy Investment and Financial Milestones

Table: AFC Energy Strategic Partnerships and Collaborations

Geography of AFC Energy’s Ammonia Strategy

Between 2021 and 2024, AFC Energy’s operational footprint was heavily concentrated in the United Kingdom, which served as a critical proving ground. Pilot deployments with Mace, Kier, and the Speedy Hire joint venture were all UK-based, allowing the company to validate its technology in the domestic construction and temporary power markets. The partnership with Urban-Air Port for the world’s first vertiport in Coventry further solidified this UK-centric focus. While partnerships with Swiss-based ABB and the global Extreme E racing series provided international exposure, the physical deployments and commercial frameworks were predominantly built around the UK market.

Beginning in 2025, AFC Energy’s geographic strategy visibly expanded from a UK-centric base to a global commercial ambition. This shift is underscored by the global manufacturing partnership with Volex, designed to scale production for worldwide demand. The joint development agreement with a US-based S&P 500 company for ammonia cracker technology further points to a North American market entry strategy. The most tangible evidence of this expansion is the deployment of a 45kVA H-Power system in Saudi Arabia through its distributor TAMGO, marking a significant entry into the lucrative MENA market. While the UK remains a core market, as evidenced by the ICL joint venture, the recent moves demonstrate a clear strategy to replicate its integrated model in key international regions, mitigating single-market risk and targeting global diesel displacement opportunities.

Technology Maturity of AFC Energy’s Hydrogen Ecosystem

In the 2021–2024 period, AFC Energy’s technology maturity was characterized by the successful piloting of its fuel cell systems and the concurrent R&D of its ammonia cracker. The fuel cell technology moved beyond the lab, proving its reliability in real-world applications with partners like Extreme E and Kier. Product launches like the 10kW “Power Tower” in 2022 and the first commercial order from Niftylift in 2024 signaled a transition from demonstration to early commercialization. In parallel, the ammonia cracking technology was in a nascent, pre-commercial stage. Milestones like achieving high energy efficiency (9.5 kWh/kg of H2) in March 2024 and commissioning the 400kg/day plant in late 2023 were critical internal validation points, but the cracker was not yet a standalone commercial product.

The year 2025 marks a major leap in maturity for both technologies, with a clear pivot to commercial scale. For fuel cells, the focus shifted from pilot deployments to manufacturability and cost-competitiveness. The announcement of an 85% reduction in the build cost of its 30kW generator and the strategic manufacturing partnership with Volex are definitive steps from low-volume production to readiness for mass-market scale. Simultaneously, the ammonia cracker technology graduated from an internal R&D project to a commercialized product. The launch of the portable Hy-5 module and its associated FaaS model in March 2025 transformed the technology into a market-ready solution. The JV with ICL and the JDA with an S&P 500 industrial partner provide powerful third-party validation, confirming that the ammonia cracker is now mature enough to be a central pillar of AFC Energy’s commercial strategy and a distinct revenue stream.

Table: SWOT Analysis of AFC Energy’s Ammonia Cracking Strategy

Forward-Looking Insights and Summary

AFC Energy has spent 2025 architecting a comprehensive ecosystem to solve the biggest challenges in distributed hydrogen power: cost and fuel availability. The recent data signals a company that is no longer just a technology developer but a commercially-focused enterprise with a clear, albeit ambitious, roadmap. The year ahead will be a test of execution on this newly built foundation. The market should expect a decisive shift from announcements to deployments, with revenue growth and operational performance becoming the primary metrics of success.

Three key signals will determine AFC Energy’s trajectory. First, the initial deliveries of the Hy-5 ammonia cracker in 2026 and the market uptake of the FaaS model will be the ultimate litmus test of its vertical integration strategy. Second, progress on the Volex manufacturing partnership will be critical; stakeholders should watch for updates on production volumes and whether the 85% cost reduction can be maintained and improved at scale. Finally, the commercial results from the ICL joint venture and any follow-on orders from the TAMGO deployment in Saudi Arabia will indicate if the model is truly replicable and scalable globally. The traction is clearly with integrated, on-site hydrogen production. If AFC Energy can successfully execute on these fronts, it is positioned not just to participate in the energy transition, but to profitably accelerate it by making clean, off-grid power both accessible and economical.

Frequently Asked Questions

What was AFC Energy’s main strategic change in 2025?
In 2025, AFC Energy pivoted from being just a fuel cell developer to an integrated energy solutions company. The core of this change was the development and launch of its own on-site hydrogen production system using a portable ammonia cracker (the Hy-5). This directly addressed the key challenge of expensive and complex hydrogen fuel logistics that was identified in its earlier pilot projects.

Why is ammonia cracking so important to AFC Energy’s plan for commercialization?
Ammonia cracking is the key that unlocks AFC Energy’s commercialization strategy. Ammonia is much easier and cheaper to transport and store than hydrogen. By developing a portable cracker, AFC Energy can produce hydrogen directly on-site where it’s needed. This solves the fuel supply bottleneck, lowers the cost of hydrogen for customers (targeting ~£10/kg), and allows AFC to offer a complete, integrated “fuel as a service” (FaaS) solution.

How is AFC Energy planning to make its fuel cells more affordable?
AFC Energy is using a two-pronged approach to reduce costs. First, it has re-engineered its systems, achieving an approximate 85% reduction in the build cost of its 30kW generator. Second, it has signed a global strategic manufacturing partnership with Volex plc to scale up production, which is expected to create economies of scale and further drive down costs to compete with diesel generators.

Who are AFC Energy’s key partners in its new ammonia-based strategy?
Several partnerships formed in 2025 are critical. These include a 50:50 joint venture with Industrial Chemicals Group (ICL) to produce and sell hydrogen from ammonia in the UK, a manufacturing partnership with Volex to scale fuel cell production, a development agreement with an unnamed S&P 500 industrial giant to advance cracker technology, and a distribution partnership with TAMGO to enter the MENA market, starting with Saudi Arabia.

What is the difference between AFC Energy’s focus in 2021-2023 versus 2024-2025?
Between 2021-2023, the focus was on proving the technical viability of its fuel cells through pilot projects (e.g., Extreme E, construction sites), which successfully demonstrated the technology but highlighted hydrogen supply as a major weakness. In 2024-2025, the focus shifted to solving that weakness and achieving commercial scale. This involved commercializing the ammonia cracker, drastically reducing manufacturing costs, and forming strategic JVs and partnerships to create a complete, cost-effective ecosystem for on-site power generation.