Doosan Fuel Cell, the hydrogen business unit of South Korean conglomerate Doosan Group, signed a contract worth 346.8 billion won ($255 million) to supply hydrogen fuel cell to China’s combined heat and power business operator, the Korean firm said Monday.

Doosan Fuel Cell said it will provide a total of 105MW in hydrogen fuel cells to China’s ZKRG Smart Energy Technology (Foshan) Co. Of them, 50MW will be manufactured and assembled in Korea by 2024 while the remaining 55MW will be delivered as components by 2026.

In September 2021, Doosan Fuel Cell delivered four units of 440kW hydrogen fuel cells to ZKRG.

Besides the supply contract, the two firms have also agreed to establish a joint venture to foster China’s hydrogen fuel cell development and collaborate to seek further business opportunities and sales channels in China.

For the first step, they will work on providing hydrogen fuel cells for the upcoming project by Guangdong Province to operate a carbon-free hospital. Earlier this year, the Chinese provincial government released a new plan to establish 40 green institutions by 2045.

The Korean firm said its Phosphoric Acid Fuel Cell (PAFC) technology, which leverages liquid phosphoric acid as an electrolyte, will offer benefit of durable and fuel-flexible energy.

“ZKRG is the first overseas client that Doosan Fuel Cell will export hydrogen fuel cells to, so based on the mutual trust and deep understanding of each other’s business, we hope to make synergy and expand the business together,” said Je Hu-seok, CEO at Doosan Fuel Cell.

Je said that the Korean firm will accelerate the supply of hydrogen fuel cells by establishing a manufacturing factory and overseas office in China in the future.