The global energy sector is undergoing a historic transformation. The long-dominant, seemingly simple and efficient fossil fuel-based energy model has revealed its strategic security vulnerabilities, made evident by today’s geopolitical realities. Yet, since new, autonomous, and sustainable energy solutions still require major investments, we find ourselves in a rather complex transitional phase in terms of energy systems.
As a result of the changes already underway, it’s clear that 21st-century (energy) security is no longer merely about access to fuel—be it oil, gas, or uranium—because today, energy from the sun or wind can be generated cheaply almost anywhere. However, the challenges of building a complete energy system based on this cheap but intermittent energy are now well understood. The decisive factor for the future will be affordable technologies for storing and upgrading this energy—and owning those technologies.
Strategic dependency is thus shifting from oil fields to the patent portfolios of new technologies. It’s safe to say that a country that fails to take action in this area will remain dependent on smarter nations for imported technologies to keep its nuclear plants, wind farms, electrolyzers, or fuel cells running. For Estonia and similar countries, this would simply mean replacing dependence on oil and gas imports with dependence on foreign technology. But this shift also presents opportunities.
Selling shovels and pickaxes during the gold rush?
Perhaps the best way to describe the strategy chosen by Estonian entrepreneurs and scientists is the well-known saying that during a gold rush, it’s often not the gold seekers who get rich, but those who sell the shovels and pickaxes. While the world continues to search for the most effective ways to use hydrogen—in shipping, land transport, heavy industry, or long-term energy storage—Estonia has, compared to its neighbors, invested notably in developing the very technologies needed to achieve these goals.
We’re talking about components based on Estonian research and intellectual property—fuel cells, electrolyzers, and, indirectly, supercapacitors.
Of course, advanced research is being done across all developed nations. The key question, however, is who will ultimately reap the most valuable rewards—the strategically significant technologies and know-how—at the right moment.
Estonia has plenty to show in this regard. The vitality of this strategy is not proven by lofty visions but by the companies already operating and making an impact on the global stage:
- Elcogen AS, founded in Estonia over 20 years ago, has witnessed both the highs and lows of the hydrogen industry. Through it all, the company has not only endured but thrived, becoming a global leader in high-temperature fuel cells and electrolyzers—thanks to the clever material design of its electrodes, which enables exceptional efficiency.
The global demand for such products is evident from the company’s new ELCO-1 factory, opened this September in Loovälja Industrial Park near Tallinn. The facility spans 14,000 square meters, and its combined nominal production capacity for fuel cells and electrolyzers has increased 36-fold—from 10 MW to 360 MW annually.
Strategic investments from industrial giants such as Baker Hughes and HD Hyundai, as well as partnership agreements for producing green steel (Project SYRIUS) and green ammonia (in collaboration with Casale), demonstrate that this Estonian company is not just a component supplier—it’s a core technology provider for next-generation energy systems. - Stargate Hydrogen OÜ was founded only in 2021, but its core technology stems from years of research. The company’s breakthrough innovation is its patented ceramic catalyst material, Stardust, which enables high-efficiency hydrogen production in alkaline low-temperature electrolyzers.
Demand for this technology is reflected in the company’s newly opened factory (June 2025) in Tallinn. Its initial production capacity of up to 140 MW of electrolyzers per year can be scaled flexibly to as much as 1 GW annually. Stargate has rapidly risen to international prominence, with Estonian electrolyzers becoming key components in several major energy projects—among them, an investment from Spanish energy giant Repsol and, notably, the electrolyzers used in Estonia’s first public hydrogen refueling station (Utilitas / Alexela) in Tallinn.
These companies now operate at a scale where they are no longer local success stories but are becoming critical links in the global energy supply chain.
More to come
The good news is that the hydrogen sector in Estonia doesn’t stop with these two manufacturing pioneers. In recent years, a new wave of innovators has emerged from universities—mainly the University of Tartu, but also TalTech and the National Institute of Chemical Physics and Biophysics (KBFI).
PowerUP Energy Technologies, for example, has already gained international recognition with its portable power generators based on low-temperature (PEM – polymer electrolyte membrane) fuel cells, and is now expanding into the defense sector. Other companies include H2Electro OÜ (developing robust high-temperature fuel cell and electrolyzer systems capable of handling fuels other than pure hydrogen) and GaltTec OÜ (focused on portable, miniature high-temperature fuel cells).
What all of these companies have in common is that their technology is based on Estonian intellectual property—developed by local scientists and engineers.
A strong supporting ecosystem is essential
These success stories did not appear out of nowhere. World-class electrochemistry research, conducted at the University of Tartu for more than half a century, has laid the scientific groundwork for these technological advances. Estonian entrepreneurship has done the rest.
Today, new support structures are being established to help translate scientific discoveries into industrial applications. For instance, in 2023, the state-owned company Metrosert AS founded the Applied Research Centre (RUK), which fills Estonia’s previously missing RTO (Research and Technology Organisation) role. Its mission is to help commercialize scientific innovations in collaboration with businesses.
RUK’s hydrogen technologies division is currently building a semi-industrial fuel cell and electrolyzer testing laboratory, designed to serve all companies in the sector in developing and validating their products.
What’s next? Timing is the key
Today’s market correction in hydrogen investment doesn’t signal a loss of faith in hydrogen itself—rather, it’s a shift from overhyped projects toward more realistic, economically sound ones. Global hydrogen consumption (around 100 million tonnes per year) continues to rise, driven by growing energy and raw material needs. The coming years will filter out the impractical players and make room for serious, technology-driven companies that focus on sectors where hydrogen truly has an advantage—such as shipping, chemical production, metallurgy, and long-term energy storage.
Estonia, led by its strong deep-tech companies and research institutions, is well positioned for this next phase. If we can stay the course—supporting our scientific and industrial “crown jewels” so they continue to innovate and operate from Estonia—we could soon have a unique opportunity. Not just to participate in the next energy revolution, but to help lead it—from the top of the value chain, with smart, realistic, and truly home-grown technology.