By Bruce Striegler
Hydrogen fuel cells finding commercial success
“Ballard Power Systems is a recognized leader in the design, manufacture and deployment of hydrogen fuel cell systems,” says Guy McAree, Director of Marketing and Investor Relations. “We’re a publicly traded company that has been developing intellectual property and knowledge around fuel cells for nearly thirty years. We are focused on specific market segments around the globe where we sell those stacks and systems, particularly the stationary and motive power markets which include materials handling and transit buses.”
Once hailed as the environmentally-friendly replacement for internal combustion engines in automobiles, the hydrogen fuel cell industry has yet to overcome the challenges to become competitive with conventional engines. As the U.S. Department of Energy notes on its website, the potential benefits of the technology for automotive power are substantial. Those benefits are such that in November 2012, CNN reported on commitments by auto manufacturers to develop hydrogen fuel cell cars, describing Toyota, Hyundai, Daimler and Honda as all announcing plans to build vehicles that run on the most abundant element in the universe and emit only water vapour. Hyundai further announced it will offer a fuel cell version of its ix35 sports utility vehicle by the end of this year and plans to manufacture up to 1,000 fuel cell cars by 2015 and 10,000 annually in the years following.
In the meantime, Vancouver-based Ballard Power Systems Inc., founded in 1979 to conduct research and development in the area of high-energy lithium batteries and other environmentally clean energy systems such as fuel cells, underwent a makeover beginning in 2007. The company shifted focus from development of high-cost automotive fuel cells with extremely high, but long-term future potential, to fuel cell products for near-term commercial markets. Ballard specializes in proton exchange membrane (PEM) fuel cell technology, one of numerous types currently in experimental or commercial use.
According to the U.S. National Fuel Cell Research Center, the high capital cost and unknown durability of fuel cells are the largest factors contributing to the as yet limited market penetration of the technology. However, Ballard’s fuel cell product revenue has experienced growth in recent years, led by applications in telecom backup power and materials handling, more precisely, forklifts. Sales in these markets have seen an annual revenue growth rate of 30 per cent over the past 3-year period. “In the last three of four years, Ballard has brought the cost of its fuel cells down by about 60 per cent so we’re now at a point where we are commercially viable as an alternative to lead-acid batteries or diesel generators,” says Guy McAree.
The workhorse of the warehouse goes clean-tech
McAree explains the company’s involvement in the materials handling field, saying, “We manufacture the fuel cells and sell those stacks to a downstream system integrator.” To obtain a desired power output, individual cells are combined to form a fuel cell stack. Increasing the number of cells increases the voltage, while increasing the surface area increases the current.
Ballard has an exclusive supplier agreement with New York’s Plug Power Inc. for a branded hydrogen fuel cell system (“GenDrive”) in North America and limited exclusivity in Europe. Plug Power holds the leading spot in North America’s clean energy lift truck market and recently announced a joint venture with Axane, a subsidiary of Air Liquide, to meet the demands of fuel cell products in the European material handling market. Notably, IKEA has signed to convert its entire operation in Southern France to fuel cell products in 2013. Plug Power says it has deployed over 3,000 GenDrive units with run times exceeding 8.5 million hours.
Beginning with studies in 2007, the U.S. Dept. of Energy expressed a keen interest in fuel cells for various applications. Findings indicated that PEM fuel cells offered a unique value for forklifts in warehousing and distribution centres. Examining lifecycle costs, market penetration and customer opinions, study results showed that fuel-cell powered lift trucks required a 48 to 50 per cent lower investment than battery-powered counterparts in high production locations.
Although PEM fuel cell forklifts require a greater capital investment, they provide significant savings in operating and maintenance costs. On-site tests have proven they run three times as long between re-fuelling with much shorter refuelling times, taking minutes rather than the half hour or more required to change out a battery. With fuel cells, another advantage is weight and mass. Heavy batteries take up storage space and run for only about six hours while fuel cells last more than twice as long and require no storage and changing rooms for batteries.
Fuel cell forklifts for military and major corporations
The U.S. Department of Defence has taken an aggressive stance with its fuel cell fork lift program. The Defence Logistics Agency, the combat logistics support agency providing the Army, Navy, Air Force and Marine Corps with logistics, acquisition and technical services has embarked upon a number of fuel cell research programs. Fuel cell powered forklifts are appearing at military facilities in the United States and around the world to replace battery powered lift trucks either through conversions or fleet replacement.
In a January 2013 market update, Ballard listings of new and repeat customers of Plug Power’s GenDrive material handling equipment showed that Lowe’s has acquired more than 160 hydrogen fuel cell powered forklifts for its facility in Atlanta, Georgia. Similarly, Mercedes-Benz has purchased 72 GenDrive systems to operate its electric lift truck fleet in Tuscaloosa, Alabama, and Stihl Inc. acquired 75 systems for its site in Norfolk, Virginia. Ballard’s update reports that BMW first purchased 86 fuel cell-powered forklifts in 2010 for use at its Spartanburg, South Carolina manufacturing plant and two years later, convinced of their efficiency and other benefits has placed a follow-on order to convert the plant’s entire fleet of forklift trucks to fuel cell power.
Procter & Gamble selected the GenDrive system to power its electric lift truck fleet at its manufacturing facility in Pennsylvania, increasing its total number of fuel cell forklifts in use to more than 340. Sysco has over 600 fuel-cell-powered lift trucks operating at seven of its food distribution facilities across America. Walmart Canada recently opened a $115 million, 400,000 square-foot grocery distribution centre in Balzac Alberta, North of Calgary where it utilizes 95 fuel cell lift trucks. Based upon the success of its Alberta centre, Walmart placed additional orders, and now has more than 500 PEM fuel cell trucks operating in three warehouses.
Fuel cell powered transit buses move towards commercialization
“We’ve been in the bus market since the early 1990’s when we first did a program with B.C. Transit and we’re now into our sixth generation of fuel cell bus engines,” says Jeff Grant, Ballard’s Business Development Manager for the North American bus market. “We supply the fuel cell engine which is a fuel cell stack integrated into a hybrid drive similar to that you would see on a diesel bus.”
He says Ballard has over forty units operating in revenue service with many of those in Europe which is the lead market for fuel cell buses. European bus manufacturers that have supplied buses for recent demonstrations include Van Hool, Rampini, VDL, APTS and Wrightbus, all with fuel cells from Ballard. Grant says the European Union government is most supportive of the technology, but adds that Ballard also has buses in North and South America, China and India.
The largest fuel cell-powered transit bus fleet in the world is in Whistler, B.C. The fleet of 20 Ballard-powered buses operated by B.C. Transit entered service in time for the 2010 Olympic and Paralympics Winter Games. Not only has the fleet been a showcase for the technology, but it is the first hydrogen fuel cell bus fleet to reach over 1.5 million miles of revenue service. The low-floor buses have a range of 450 to 500 kilometres, a top speed of 90 km/h, and a life expectancy of 20 years with a total price tag including capital and operating costs to March 2014, of $89.5 million.
Fuel Cell Today (FCT) is a British organization that for the last ten years has provided global analysis and fuel cell market information. In its 2012 Fuel Cell Industry Review, it notes a decrease in fuel cell bus deployments from 2010 to 2011, but reports a spike in demonstration projects in Asia. FCT expected a slight increase in fuel cell bus shipments in 2012, but more importantly, points to increased interest of commercial bus manufacturers now involved in developing and running trials on fuel cell models.
Demand increases for transit demonstration projects
FCT anticipates that interest, combined with the innovations and cost reductions suppliers of fuel cells are making, will create widespread operation of fuel cell buses, possibly beginning as early as 2014. The U.S. Department of Energy’s National Renewable Energy Laboratory’s 2012 report of fuel cell buses in U.S. transit fleets says that despite some remaining challenges, fuel cell electric buses continue to show progress toward meeting technical targets for commercialization and are following the timeframe of the recently commercialized propulsion technologies such as liquefied natural gas (LNG) and diesel hybrid buses.
In 2011 a ‘Buy America’ compliant fuel cell bus became operational at SunLine Transit Agency in Palm Springs, California. The ElDorado bus uses a Ballard fuel cell, with propulsion and power management systems from BAE Systems. Developed under the U.S. Federal Transit Administration’s National Fuel Cell Bus Program, there are four more in the cards for further U.S. deployments. Transport for London operates Ballard-powered buses on the City’s scenic RV1 route past the Tower Bridge, Covent Garden and the London Eye. The buses have refuelled safely more than a thousand times at busy City locations and travelled more than 100,000 miles since deployment in 2011.
“We’re seeing a steady demand for zero emission buses around the world,” Jeff Grant notes. “With conventional urban diesel buses producing carbon dioxide emissions in the range of 140 to 150 tonnes yearly, as well as particulate matter and nitrogen oxides, air quality can be improved by reducing greenhouse gas emissions and air pollutants produced by buses by using fuel cells.”
Grant says another strong benefit of fuel cell buses is noise reduction. “Vehicles can operate on routes that may have noise sensitivity issues, a fact that transit companies are pleasantly surprised to discover.” A compilation of global fuel cell bus projects lists over 100 operated between the late 1990’s and 2011, 27 of those in China. Ballard’s technology shows up in Brazil, Germany, Iceland, Luxembourg, the Netherlands, Norway, Portugal, Spain and Sweden.
Adapting fuel cell technology for backup power and distributed generation
Fuel cells require a continuous source of hydrogen and oxygen to run, but can produce electricity for as long as these supplies are available. In spite of the high-tech impression, fuel cells have been known to science for about 150 years, and in 2013 they are being used for primary or backup power for a range of commercial uses, including wireless telecom base stations. Ballard says it has more than 150 megawatts of its products installed commercially in Europe, Asia, Africa, North and Central America.
Explaining backup power, Guy McAree says, “These are systems for service providers such as wireless phone operators around the world. Our fuel cell-based system can provide power back-up to the cell towers in the event the electric grid goes down, a fairly frequent occurrence in some countries. We provide two solutions in this market, one operating directly on hydrogen and the other operating on methanol, and we’re experiencing tremendous growth in these markets.” PEM fuel cells can use hydrogen gas as a fuel, or a methanol/water mixture used in tandem with a reformer, which strips the hydrogen from the fuel, and makes it available to the fuel cell. Using the reformer eliminates the need for transporting and dealing with hydrogen gas.
Citing Hurricane Sandy, McAree says, “Seventeen Ballard ElectraGen™ ME methanol fuel cell systems were put to the test in extreme conditions. They performed exactly as designed, providing critical electricity to the Bahamas mobile telephone network when the storm downed power lines. During the three days that Hurricane Sandy ravaged the Bahamas, each of the five kilowatt systems operated flawlessly, maintaining full power on a continuous basis.”
Mr. McAree says that the distributed generation market is a relatively new opportunity for Ballard. ”Distributed generation are larger scale power systems sold where there is typically available hydrogen. We can put clean energy right at the point of demand using modular 500KW power banks which can be combined to produce multiple megawatts. The most recent system we’ve sold was a full megawatt that we deployed last year to Toyota Motor Sales head office complex in Torrance California.”
Toyota California headquarters use distributed generation
The fuel cell will supply approximately half of the electricity for six headquarters buildings during peak demand, while producing zero emissions. It is the largest PEM fuel cell of its kind powered by hydrogen gas fed directly from a pre-existing industrial hydrogen pipeline, also a first for this technology. This direct power source allows Toyota to reduce grid electricity usage during peak power demand and is expected to save the Company approximately $130,000 a year in reduced energy costs. The same hydrogen pipeline also supplies a hydrogen filling station adjacent to the Toyota campus used to fuel Toyota’s and other manufacturers fuel cell hybrid vehicle fleets.
At 1.1 MW, the clean energy fuel cell system can provide enough power for about 765 homes, twice the capacity of Toyota’s existing solar panel system on campus. It is expected to reduce CO2 emissions by 3.3 million pounds during summer peak period hours, equivalent to taking 294 cars a year off the road.
In the fall of 2011, Ballard Power Systems was awarded a global consulting firm’s 2011 New Product Innovation Award. Frost & Sullivan recognized Ballard’s technological leadership and strong market position in the commercialization of PEM fuel cells for distributed energy generation, saying Ballard’s solution surpassed the competition in terms of fuel cell durability, product cost and load-following capability which were all keys to commercially-viable grid-scale solutions.