Hanwha Power Systems and the Future of CCUS: A Strategic Play in Decarbonizing Power Generation

The global energy transition is accelerating, and companies that can bridge the gap between traditional energy systems and low-carbon alternatives are poised to capture significant value. Hanwha Power Systems, a South Korean engineering firm, has emerged as a key player in this transformation through its innovative compressor technology for Carbon Capture, Utilization, and Storage (CCUS). With the CCUS market projected to grow at a compound annual rate of 23.1% through 2029 [1], Hanwha’s strategic focus on decarbonization technologies positions it as a compelling investment opportunity in the industrial decarbonization space.

Innovative Compressor Technology: The Core of Hanwha’s Competitive Edge

At the heart of Hanwha’s CCUS strategy is its advanced Mechanical Vapor Recompression (MVR) compressor technology. In 2025, the company secured a landmark contract to supply these compressors for a next-generation combined-cycle power plant in Europe, a project that will integrate CCUS to reduce carbon emissions by up to 90% [2]. These MVR compressors operate by reusing low-pressure steam to generate high-temperature steam, cutting energy consumption and operational costs by up to 30% compared to conventional systems [2]. This innovation not only enhances the economic viability of CCUS but also addresses a critical barrier to adoption: the high energy penalty associated with carbon capture.

Hanwha’s compressors are engineered to handle extreme conditions, with specifications reaching 240 tons per hour at 200 bar A discharge pressure—critical for applications like enhanced oil recovery and hydrogen production [3]. The company’s modular design approach and proprietary control systems further ensure reliability, a key concern for industrial clients. By 2023, Hanwha had already deployed these systems in commercial operations, including dry ice production and CO₂ capture in naphtha cracking processes [3].

Strategic Partnerships and Market Expansion

Hanwha’s ambitions extend beyond power generation. In 2025, the company partnered with Baker Hughes to develop ammonia gas turbines for carbon-free marine propulsion, targeting the hard-to-abate maritime sector [4]. This collaboration leverages Hanwha’s ammonia combustion expertise and Baker Hughes’ small-size gas turbine technology, aiming to deliver scalable solutions for decarbonizing shipping—a sector responsible for nearly 2.5% of global CO₂ emissions [4]. Such partnerships underscore Hanwha’s ability to diversify its CCUS-related offerings and tap into adjacent markets.

The centrifugal compressors market, a broader segment in which Hanwha operates, is also expanding. Valued at $14.06 billion in 2024, it is projected to reach $20.21 billion by 2032, driven by demand for energy-efficient solutions in oil and gas, chemical processing, and power generation [5]. Hanwha’s focus on digital monitoring systems and predictive maintenance further strengthens its competitive positioning in this high-growth sector.

Financial Health and Market Tailwinds

While segment-specific financial data for Hanwha’s CCUS operations remains opaque, the company’s overall financial performance is robust. In 2024, Hanwha Systems (the parent company) reported operating profits of $2.25 billion and total sales of $27.94 billion, reflecting a 78% year-over-year increase in operating profit compared to 2023 [6]. These figures suggest strong operational leverage as the company scales its clean energy initiatives.

The CCUS market itself is being propelled by regulatory tailwinds. The U.S. Inflation Reduction Act’s tax credits for carbon capture and the European Innovation Fund’s support for CCS projects are creating a $80 billion investment pipeline by 2030 [7]. Hanwha’s European MVR compressor project aligns directly with these incentives, positioning it to benefit from policy-driven demand.

Investment Considerations and Risks

Despite its strengths, Hanwha faces challenges. The lack of granular financial data for its CCUS segment makes it difficult to assess the unit’s contribution to overall profitability. Additionally, competition from established players like Siemens Energy and GE Vernova could intensify as the market grows. However, Hanwha’s niche focus on high-pressure CO₂ compression and its early mover advantage in ammonia-based technologies provide a buffer against broader industry competition.

Conclusion: A Strategic Bet on Decarbonization

Hanwha Power Systems is capitalizing on the dual megatrends of energy transition and industrial decarbonization. Its MVR compressors and ammonia gas turbines address critical gaps in carbon capture and clean propulsion, while its financial performance and strategic partnerships reinforce its credibility. As governments and corporations accelerate their net-zero commitments, Hanwha’s technology stack and market positioning make it a compelling long-term investment in the CCUS value chain.

Source:
[1] Global CCUS Market Projections, [https://www.iea.org/commentaries/ccus-projects-around-the-world-are-reaching-new-milestones]
[2] Hanwha Power Systems’ MVR Compressor Contract, [https://www.prnewswire.com/news-releases/hanwha-power-systems-supply-of-co-mvr-compressors-to-a-combined-cycle-power-plant-utilizing-ccus-in-europe-302543504.html]
[3] CO₂ Compressor Specifications, [https://m.hanwhapowersystems.com/en/product/clean-products-01]
[4] Baker Hughes Collaboration for Ammonia Gas Turbines, [https://www.hanwhapowersystems.com/]
[5] Centrifugal Compressors Market Growth, [https://www.openpr.com/news/4131260/centrifugal-compressors-market-to-reach-usd-20-21-billion]
[6] Hanwha Systems Financial Performance, [https://www.hanwhasystems.com/en/investment/financial-info.do]
[7] Global CCS Investment Trends, [https://carboncredits.com/80b-surge-in-carbon-capture-investments-by-2030/]