On 09.20.2021 Fuel Cells Works sat down with Ballard’s deft and very thoughtful Timothy Sasseen to get Ballard’s perspective on the hydrogen sector. This has been a positive year for Ballard and the hydrogen industry overall, and just last week on 09.16 Ballard introduced its next generation FCMove HD+ fuel cell to the market. Without a doubt the world will be seeing a lot more of Ballard as we progress into the future.
FCW: Has Ballard noticed any correlations over the past 42 years between the extreme environmental events like those we observed in Seattle, Washington and Texas this year and interest in hydrogen fuel cells? If there has not been a correlation, yet, then what reasons does Ballard see for extreme weather events not driving end users to hydrogen technology?
There are two peaks that we can point to if you look at Ballard’s stock as a proxy for market indication. The first big spike came around 2000 was during the Bush administration. I can’t point to a climate trend that would correlate at that time. I think the pressure was more political in nature and I think if you went back it would have more to do with fuel economy standards more than anything. And I think that this time around the big push for hydrogen has largely been due to legislated carbon goals, and I think that having real carbon targets has motivated money to go into the market to pay for deployments. Now those regulations may be motivated by climate events, certainly in California wild fires have pressured action and air quality has pressured action. To me there is not a clear correlation between climate events and market activity. I think the strong correlation is between financial incentives and regulation and market activity. I think it is much more economic where the market needs to have surety that the money is there to pay for the technology and that there is a long-term guarantee of demand so that they can see that these regulations are going to stay in place, and that what is mandated this year is the same thing that is mandated four years from now. I think the long-term carbon mandates along with the resulting funding have been what really have moved the market forward, and I think that the climate events do not have a close enough correlation with people buying vehicles. People are buying vehicles now by and large to comply. The only people who are not buying vehicles just to comply with regulation are companies that have internal mandates, like Microsoft.
You can see at ACT Expo that the offerings there while a lot of people were showing up from outside of California, the trucks that were there were by and large their development was paid for by California or outside of the United States.
FCW: We have seen Hyzon this year ink a deal with a company like Raven SR to have it create hydrogen production facilities. Is Ballard making similar deals with other hydrogen suppliers?
Is Ballard considering opening up hydrogen fueling stations in key markets to help support its fuel cells that are on the road?
One of the primary advantages of hydrogen is having a multiplicity of suppliers available. We saw in material handling that it was very popular to have the same supplier for fuels cells as for fuel because in many of these locations there simply was no hydrogen available for transportation uses. For the markets that we are addressing we see growth of FCEVs regionally, the concept of hydrogen hubs is talked about a lot at the federal level and the regional level and we believe that is how the industry is likely to grow. In that scenario having co-located users of FCEVs in the same region should promote competitive fuel markets, and that is an advantage for the end customer in that competition should drive down price and having a variety of sources means that your supplies are reliable. If one supplier has trouble providing fuel for whatever reason, then you have another competitor that you can get your fuel through. Right now, Ballard has no plans on exclusive agreements with fuel suppliers. Our approach is to facilitate the market, and we help all fuel suppliers to meet customers and to have access to the kind of market growth information that we have. We believe that helping stimulate the entire marketplace is going to give the kind of market that fuel cell electric providers want. They want a market place that has competitive fuel providers from a variety of sources, and a variety of carbon levels, and a variety of prices, incentives, and fueling contracts. We think that an open competitive marketplace is going to facilitate that better than providing a one-stop solution for fuel and vehicle. While it is difficult right now for end users because fueling supplies are just coming online we think that is a short-term situation, and within a few years that will be rectified and you will see very competitive pricing and aggressive marketing by fuel supplies in the hydrogen market for transportation.
FCW: What does Ballard feel are the most challenging areas (besides hydrogen fueling stations) that are facing the hydrogen sector in Canada, China, Europe, and the U.S?
Vehicle storage of fuel for large fuel consumers has a lot of work to be done to prove out different options for rail, for marine, and even for stationary applications there is a lot of interest in different fuel options for getting a lot of fuel into a small place, and that is a challenge. There are a lot people looking at ammonia, there are a lot of people looking at methanol, there are a lot of people looking at liquid or organic hydrogen carriers, and there are people looking at liquid hydrogen and cryo-compressed hydrogen. It is good that there are a lot of options right now, but getting some industry standardization is going to be important towards the latter half of the decade. Again, to keep fuel prices reasonable and to keep a wide variety of supply vectors. If in a certain region you have a small number using ammonia, methanol, liquid, gaseous all of those users have to get their fuel from different places, and that is going to be problematic so some standardization as we get through these demonstrations and pilots needs to be assessed.
The next biggest problem is probably getting a coordinated hydrogen hub active. This will require the coordination of many players. First and foremost a big fleet operator that is willing to participate, and a fuel provider, and a vehicle provider which may then include a drive train provider and a fuel cell provider. And ideally there should be multiple fleets of various kinds like a truck fleet, a bus fleet, a train project all in the same region within say 100 miles of green hydrogen production at scale. Coordination of that kind of hydrogen hub requires some top-level entity whether public or private or otherwise, but it does need to be coordinated for it to happen fast enough.
The last problem is a matter of getting the hydrogen value proposition well known by regulatory folks for infrastructure buildout so that we do not commit available funds all to grid buildout in places where it would be cheaper to actually do it with hydrogen. In this decade it will be very important to assess what those long-term infrastructure projects are because once they get started it is going to be very hard to change course. Obviously, the grid infrastructure needs to be addressed, it needs to be strengthened, it needs to be hardened, but if we bring on double the load there is going to be places where that is going to be extremely expensive and hydrogen will have a clear advantage. Policymakers need to know that before they commit to an all-grid approach.
FCW: Why does Ballard feel supermajors like Chevron and Shell have not become leading producers of green hydrogen, yet?
I think the market is still very small for them. I think their market in traditional fuels is orders of magnitude higher than the activity in hydrogen today. I think they need to see even greater assurance from policymakers that hydrogen is going to be included in energy infrastructure buildout. I think there remains skepticism from major energy and fuel producers that carbon targets will actually be achieved and obeyed. I think there is plenty of precedence in the past for very ambitious renewable energy goals that never came to fruition. I think the timelines that the executives and the board members work on are along the lines of 5 years, 10 years max. Within those time horizons the bulk of their business, I would bet, is for seeing to be in traditional fuels. I do not think they are convinced that the decarbonization plans that have been put forward are actually being followed. I cannot imagine the world that they envision where those are not followed, but one can only speculate.
FCW: Why does Ballard feel that companies like Air Liquide and Air Products have been hesitant to fill-in the void that the inaction of supermajors has created with regard to hydrogen production and distribution?
I think they are starting to more so than they used to. Three years ago, I would have had a much more critical answer, but the activity that we have seen has been much more proactive over the past two years for providing fueling station solutions and for discussing renewable hydrogen solutions. And we are starting to see some activity. I think their boards of directors have the same concerns as to whether there is true commitment to decarbonization goals. Certainly, if you look at the potential growth of hydrogen in transportation and that penetration is something like 25-30% where a lot of studies show it that market is very large, and I think they are at risk of losing that market. Right now, the industrial gas suppliers are very well dispositioned towards producing and distributing this fuel, but the market is there to lose. We have heard from other major energy companies that are anxious to put in very large renewable hydrogen projects as soon as they can get enough off-takers. If that happens before the industrial gas companies act, then they are going to lose that market. Industrial gases are not known for major technological swings or radical market changes at least as far as the rest of us are privy to.
FCW: When does Ballard expect to see major hydrogen investments by Latin American countries?
We see some indications now particularly in mining and in salmon fishing. These are limited projects of limited scope. Latin America will become more active towards the end of the decade mostly when prices for ZEVs starts to lower. I think there will be some activity in BEVs but not much, because grid stability in a lot of Latin America countries is a big deal. It is expensive to build up infrastructure over rugged terrain. The need is very apparent since there are a lot of older vehicles that are spewing nasty criteria pollutants let alone greenhouse gases, and towns and villages that live right on the highway. And those people are definitely feeling some very adverse health effects from those vehicles. The money is extremely low. If North America, Europe, and China can develop fast enough to bring the price of [FCEVs] down then some international funding can help introduce these vehicles into Latin America. The need is apparent today but the cost vs ability to pay does not match up right now.
FCW: If we could fast forward to 2050 right now, then what areas of progress would we see where hydrogen is concerned?
I think we will see renewable hydrogen and hydrogen from waste (carbon neutral hydrogen) used in over 90% of activities that use hydrogen and that really means transportation and industrial uses. I think hydrogen from fossil sources will be extremely rare and limited to special cases by 2050.
We will see fuel cell electric across products across all size ranges. There applications to things as small as scooters or as big as airplanes will be common place.
Grid stabilization will also be done by mostly renewable energy.
You will see most everything that is powered by motion powered by BEV or FCEV.
Ballard’s commitment to advancing hydrogen fuel cells has been a perpetual testament to the importance of achieving a zero emissions economy, and with a current order book in the tens of millions of dollars Ballard continues to maintain its trajectory to helping the global economy transition away from fossil fuels to hydrogen.
Fuel Cells Works celebrates Ballard’s positive global impacts, and with 22 years of hydrogen fuel news coverage Fuel Cells Works continues to be the leader in bringing the hydrogen community the most relevant and timely hydrogen news possible.
Jesse Lyon, Contributor
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