Hydrogen and fuel cell

technology – an overview

Oct 2016

Rushlight

Ben Madden

Ben.madden@element-energy.co.uk

Element Energy Limited

2

About Element Energy

Element Energy is a leading low carbon energy consultancy . We apply best-in-class

financial, analytical and technical analysis to help our clients intelligently invest and create

successful policies, strategies and products.

Power Generation

& storage • Renewables

• Micro-generation

• CCS

• Techno-economics

• Feasibility studies

• Geographic analysis

Engineering • CFD

• Software tools

• Prototyping

• Installations

We operate in three

main sectors

We offer three main

services

Low Carbon

Transport • Electric vehicles

• H2 vehicles

• Market uptake

• Infrastructure modelling

• Business planning

• Project delivery

Due Diligence • Technology assessments

• Market growth

• Market share

• Financial modelling

• Commercialisation advice

Built

Environment • Financial viability

• Master planning

• Building design

• Policy advice

• Regional strategy

Strategy and Policy • Scenario planning

• Techno-economic modelling

• Business planning

• Stakeholder engagement

3

Element Energy – in the hydrogen sector, we have been active

from project initiation to implementation

Implementation

and

management

Project

funding and

development

Business

strategy

development Government

policy

analysis

Understanding

the technology .

Consultancy and management service provider

4

Contents

Producing affordable hydrogen

Transport uses

Hydrogen for heat

Stationary fuel cells

Other uses

5

Production options

A range of production options can lead to low carbon hydrogen

• Electrolytic production at renewable or nuclear generators – here the key is to find very low cost power at a high load factor

• Electrolytic production close to the point of demand – where grid balancing payments allow affordable hydrogen

• Production from biomass or waste – a number of options for hydrogen are maturing but have not yet been successfully demonstrated at scale

• Spare refinery or industrial capacity –often have spare capacity for hydrogen – can be cleaned and used for energy applications

• Carbon Capture – if carbon capture becomes a reality, very low cost, low carbon hydrogen can be made from natural gas

• Natural gas is reformed to make hydrogen (and CO2) for the majority of today’s applications 1% of the world’s energy is hydrogen at some point!

Today’s incumbent – production from natural gas

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RENEWABLE PRODUCTION - A number of renewable hydrogen demonstration projects have been initiated across Europe

The BIG HIT project in Orkney will demonstrate the use of constrained wind to generate hydrogen for a range of community uses

Siemens has installed a large electrolyser system near Berlin to test direct coupling of wind to hydrogen at MW scale

REMAINING KEY QUESTIONS: • Is there enough ultra low cost electricity

available at a high price • At what scale do the logistics costs become

affordable?

7

ON-SITE PRODUCTION - The Aberdeen bus fuelling station and London’s new car fuelling stations are exploring grid balancing

These stations prove the concept works and is scalable REMAINING KEY QUESTIONS: • Can the electricity supply contracts to these installations be cheap enough to

produce affordable hydrogen? • How large are the balancing payments in practice? Net electricity costs really need to fall below £60/MWh to make this work

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Other options should create low cost hydrogen but will only be viable with scale and technology improvement

These options will create large quantities of low cost green hydrogen REMAINING KEY QUESTIONS: • Can gasification systems be made reliable, given some of the recent issues? • Will carbon storage sites be available at a reasonable price? Does this require the

development of hydrogen applications?

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Hydrogen price is affected by scale and the cost of primary energy

Hydrogen price is very sensitive to the size of demand and the price of energy

Note, no margins are included here

Range for taxed diesel price parity for a bus (assuming 37l/100km, diesel @ £1.1/litre and 7-8kg/100km)

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Contents

Producing affordable hydrogen

Transport uses

Hydrogen for heat

Stationary fuel cells

Other uses

11

It is now possible to buy a hydrogen vehicle and operate on public

roads

• Vehicles are now relatively easily available, (albeit with a price premium)

• Earliest adopters can now begin trials using the existing infrastructure and making

use of the funding which is available to achieve cost parity

• The next 5-10 years should see a progressive increase in the range of models and

the spread of stations, and a significant decrease in cost of ownership

Passenger cars (from OEMs) Light commercial vehicles (RE-EV)

12-18m buses Larger trucks and vans

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Different models have emerged to create the case for investment in hydrogen infrastructure

OEM

led –

“Build

it and

they

will

come”

• Very strong tax incentives

• Network biased on

stations in strategic

locations

• Joint venture including

leading firms

• Aiming at an early

nationwide coverage of

stations

• Initial deployment sung

“captive fleets”

• Captive fleet deployment

aims to seed wider

deployment

• Clustered approach to

seed large urban clusters,

with interconnecting route

coverage

Small

captive

Will be

market

driven

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These have led to contracts being in place to deploy well over 100 hydrogen stations and >1,500 vehicles across Europe

Proposed H2ME 2 stations

Main existing or planned HRS

Main TEN-T corridors

HYDROGEN MOBILITY EUROPE 2

Top demo objectives:

• Deploy and operate 1,195 fuel cell vehicles

• Deploy and operate 20 hydrogen refuelling stations (7 x 700bar hydrogen, 6 dual pressure 700/350bar and 7 x 350bar)

• Test the ability of 9 electrolyser-HRS (>2MW in total) to provide meaningful grid services

H2ME 2 is a large-scale market test of hydrogen refuelling infrastructure, passenger and commercial fuel cell electric vehicles operated in real-world customer applications, which will demonstrate that the hydrogen mobility sector can support the wider European energy system via electrolytic hydrogen production.

Top research and dissemination objectives:

• Conclude on the technical (WP5) and commercial (WP6) readiness of the vehicles, fuelling stations and production techniques

• Produce recommendations and identify gaps preventing full commercialisation

• Assemble evidence in readiness and communicate results to support next investments

IS logo

H2ME 2 is part of the following H2M implementation initiatives:

Observer partners:

Main partners:

Key European projects TEN-T initiatives: • COHRS • H2Nodes • HIT

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There are nine operational HRS in the UK with a combined capacity of 1.2 tonne-H2/day, with four more expected to be deployed by the early 2017

Hydrogen infrastructure

in the UK today†

HRS currently operational

HRS operational but no public access

HRS currently under development

# Location Operator Capacity Pressure Source Project(s) Launch

1 Lea Interchange, London Air Products 320 kg/day Bus only 350 bar Delivered SMR CHIC 2011

2 Honda, Swindon BOC 200 kg/day 350 (& 700) bar On-site WE SWISH, SWISH2 2011, (2014)

3 Hatton Cross, London Air Products 80 kg/day 700 bar Delivered SMR HyTEC, HyFIVE 2012

4 Kittybrewster, Aberdeen BOC 360 kg/day 350 [& 700] bar On-site WE HyTransit, H2ME 2015, [2016]

5 Hendon, London Air Products 80 kg/day 350 & 700 bar Delivered SMR LHNE, HyFIVE 2015

6 AMP, Sheffield ITM Power 80 kg/day 350 [& 700] bar On-site WE Innovate-UK 2015, [2016]

7 Baglan, South Wales Uni of S. Wales 35 kg/day 350 [& 700] bar On-site WE OLEV 2011, [2016]

8 NPL, Teddington ITM Power 80 kg/day 350 & 700 bar On-site WE HyFIVE 2016

9 CEME, Rainham ITM Power 80 kg/day 350 & 700 bar On-site WE HyFIVE 2016

10 TBC, London ITM Power 80 kg/day 700 bar On-site WE HyFIVE [2016]

11 Tullos, Aberdeen Hydrogenics 80 kg/day 700 bar On-site WE ACHES [2016]

12 TBC, London ITM Power 80 kg/day 700 bar On-site WE H2ME [2017]

13 TBC, London ITM Power 80 kg/day 700 bar On-site WE H2ME [2017]

Key hydrogen infrastructure

operators in the UK

2

4 11

7

6

Completed upgrade indicated by ( )

Target launch or upgrade indicated by [ ]

†Excludes small-scale HRS in Birmingham, Coventry, Glamorgan (Glyntaff), Isle of Lewis, Loughborough,

Nottingham, University of South Wales.

London

1

3

5

8

9

In addition 2 mobile refuellers (OLEV) and 3 HRS in

London area (H2ME2) are already funded for installation in

2017.

15

Current bus activity

Market is dominated by European projects

The current market for fuel cell buses is dominated by large subsidised bus projects

which make use of European funding

16

The JIVE project will allow a considerable expansion of the European bus fleet (€32m funding, €126m costs)

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An attractive case can be made at a depot scale (extract from FCH JU procurement clusters report)

18

A partnership in Fife has nearly completed the installation of two fuelling stations and a fleet of utility vehicles – vans and refuse trucks

The Levenmouth Community Energy project will produce hydrogen directly from a renewable energy system (wind + PV) and fuel 10 vans and 2 dual fuel refuse trucks

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Ferries and trains are also being developed as part of a general trend towards heavier duty vehicles

Alstom’s fuel cell train prototype was recently announced – a fleet of these trains will operate in Germany

This ferry will be converted to run on hydrogen to service a crossing in one of Norway’s larger fjords

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Contents

Producing affordable hydrogen

Transport uses

Hydrogen for heat

Stationary fuel cells

Other uses

21

The Leeds H21 project is based on using hydrogen as a viable and affordable alternative to heat pumps or heat networks for UK heat

The H21 project envisages a series of activities to prove the concept leading up to the start of a city wide conversion from 2026

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The Leeds H21 project is creating a lot of attention based on the conversion of a city’s gas grid to hydrogen

Source: H21 report

The report envisages a ~5 year exploratory stage before a commitment to the conversion. Conversion work would start ~2026

The report also concludes that the transition can be made affordable by including the costs in the regulated settlement for gas network operators

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An alternative to using 100% hydrogen is injection into natural gas pipelines

An alternative to a 100% conversion is the blending of smaller quantities of hydrogen into the gas grid.

The map shows the number of these projects which are underway in Germany.

The exact quantity of gas which can be injected is unclear in the UK.

The first UK project will aim to prove the level of hydrogen injections which can be safely injected.

The other option is to react hydrogen with carbon dioxide to make “synthetic methane”

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Contents

Producing affordable hydrogen

Transport uses

Hydrogen for heat

Stationary fuel cells

Other uses

25

Substantial CO2 savings are available from stationary fuel cells as they are highly efficient

Source: Advancing Europe’s energy systems: Stationary fuel cells in distributed generation, Roland Berger for the FCH JU (2015)

The CO2 emissions above are based on fuel cells running on natural gas. Greater savings would be

possible in future where fuel cells are supplied with a low carbon source of hydrogen.

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Fuel cell CHP systems offer best in class overall efficiencies and can provide very high electrical efficiency

Source: Laboratories for the 21st Century: Best Practices, US EPA, US DoE, Figure 1, p.3 (2011)

Unlike heat engines, which are limited by the Carnot efficiency and materials constraints, fuel cells can theoretically achieve very high electrical efficiencies.

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

Gas

turbine

Micro

turbine

Fuel

cell

0.88

0.75 0.80 0.80

Internal

combustio

n engine

0.85

Steam

turbine

Typ

ical

CH

P e

ffic

ien

cy

(HH

V)

Electrical efficiency (range)

Overall efficiency (range), peak value indicated

Source: Data from Laboratories for the 21st Century: Best Practices, US EPA, US DoE, Table 1, p.3 (2011)

Source: Fuel Cells Technology Overview, US DoE (2012) http://energy.gov/sites/prod/files/2015/07/f25/sunita_satyapal.pdf

27

Being based on an electro-chemical (rather than combustion) process, fuel cells produce very low harmful emissions

* Source: Doosan Babcock Limited.

Further local environmental benefits of fuel cells

• Fuel cells provide the lowest harmful emissions of all CHP technologies.

• This is particularly advantageous in cities with air quality issues such as London.

• Certain stationary fuel cell systems are designed to operate in water balance and hence provide significant water savings during normal operations compared to conventional power generation.*

-88.2%

Gas

turbine

Fuel cell

Fuel cell

Gas

turbine

-99.4%

Emissions characteristics of

gas turbine vs. fuel cell CHP

SO2 N2O

Source: Data from Laboratories for the 21st Century: Best Practices, US EPA, US DoE, Tables 3, 5, 8 (2011).

28

Individual suppliers have installed hundreds of MW of large-scale stationary fuel cells, which offer very high levels of availability

FuelCell Energy Inc recently announced plans to install a 63.3 MW power plant at Beacon Falls in Connecticut. www.bloomberg.com/news/articles/2016-01-08/fuelcell-energy-jumps-on-approval-of-biggest-fuel-cell-project.

Direct FuelCell® power plants are

generating ultra-clean, efficient and

reliable power at more than 50

locations worldwide [...] with more

than 300 megawatts of power

generation capacity installed or in

backlog

www.fuelcellenergy.com/

110 megawatts installed, 12 million

hours of fleet field operation, 98%

operational up-time and an

unmatched fuel cell stack life of 10

years

Bloom Energy [is] installing 20-50

megawatts of capacity per year and

has 100 megawatts of total installed

capacity

As of mid-2014 – NOTE: BLOOM

Systems are not available in the UK

www.dailytech.com/Microsofts+New+Fuel+Cell+Partner+is+Ready+to+Blow+Away+the+Bloom+Box/article36118.htm

www.doosanfuelcell.com/en/fuel-cells/system.do

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Three large scale fuel cell CHP systems are operational in London (the largest installed capacity of any European city)

• The crown estate in Regent’s Street (~270,000 square feet) was equipped with a 300kWe molten carbonate fuel cell by Logan Energy Crown

Estate – Q3

The New Building

(‘The Walkie-Talkie’)

• A second molten carbonate system was installed in the New Building in Fenchurch Street

• In this location, the fuel cell CHP was evaluated as the best option to ensure compliance with London planning regulations requiring local generation

The Palestra Building

• Logan installed a CHP system in Transport for London’s Palestra building: a 200 kWe phosphoric acid fuel cell unit

• The system cut an estimated 40% of CO2 emissions, along with around £90,000 per annum in cost savings

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Fuel Cell CHP is a disruptive technology in the micro-CHP market driving rapid growth in Japan

• Fuel Cell CHP (FC CHP) is a rapidly growing market, capturing over 70% of the global mCHP market in 20141.

• The global leader in FC CHP is Japan, which started demonstrations in 2003, with a substantial subsidy program (ENE.FARM) started in 2009.

• The leading manufacturers (Toshiba, Panasonic) are already producing 20,000 units/year (PEM).

• The European market has not yet seen deployment of this scale: less than 1,500 units have been deployed in Europe with less than 100 in the UK

Introduction

Source: Delta-ee (2012): www.delta-ee.com/images/downloads/pdfs/Delta-ee_mCHP_market_status_and_potential_Cogen_Czech_161012.pdf (s.8)

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Small scale combined heat and power (CHP) and prime power applications with fuel cells are also being developed

3

1

Introduction

Fuel cell systems of <2kWe suitable for installation in domestic properties either as boiler replacements or for stand alone heat and power generation

Fuel cell CHP in the 2-20kWe range are suitable for larger commercial applications and residential applications with shared services

Ceres, a UK company, may have the potential to become a leader in small-scale CHP technology

32

Volume is needed to drive cost reduction to the point where this becomes a viable option

3

2

Introduction

33

Contents

Producing affordable hydrogen

Transport uses

Hydrogen for heat and the wider energy system

Stationary fuel cells

Other uses

34

A wide range of other uses have been developed which use

hydrogen as a fuel

35

In summary

• Producing affordable hydrogen – needs scale and affordable primary energy

• Transport uses – starting to mature, real vehicles are on the road – an emerging trend is to target heavier duty vehicles first

• Hydrogen for heat and the wider energy system – very exciting alternative to expensive options for decarbonising heat – more work needed to prove the option

• Stationary fuel cells – capable of providing near term decarbonisation, require supporting legislation/regulation

• Other uses – numerous niches emerging – watch this space!