Significant Pipeline Increase
ITM Power (AIM: ITM), the energy storage and clean fuel company, is pleased to note the planned publication by the UK Government of a revised Air Quality Plan, under which, according to media reports, it is proposed to ban the sale of petrol and diesel passenger cars (including hybrids) by 2040.
The new UK Government Air Quality Plan that bans all new non-zero emission passenger cars by 2040 represents an historic first step towards cleaner and greener transport in the UK.
ITM Power calls on the UK Government to provide equivalent financial support for fuel cell electric vehicles (FCEV) infrastructure as it has already provided for plug-in battery electric vehicle (BEV) infrastructure. Equivalent funding would satisfy the UK Government’s stated position of being technology agnostic. The Company also calls on the Government to implement its announced plan to provide 65 hydrogen refuelling stations across the UK, to be operational by 2020. Current proposed levels of funding for hydrogen infrastructure would not achieve OLEV’s stated target.
Significant pipeline increase, £6.57m in the last two weeks
Separately, ITM Power announces a significant increase in its order pipeline. The Company currently has £23.45m of projects under contract and £11.89m of contracts in the final stages of negotiation, totalling £35.34m (subject to exchange rate variation). This constitutes an increase of £6.57m of contracts in negotiation since the last announcement on 11 July 2017.
Why fund FCEV infrastructure?
FCEVs have a number of advantages over the plug in battery electric vehicle (BEV), although both are electric vehicles with the key difference being the way that the energy is transferred to the vehicle. BEVs store the energy in a battery; increased range requires more batteries, which makes vehicles heavier and less efficient. Increasing the range of a FCEV is achieved by making the hydrogen tank bigger which has only a small effect on the weight. The result is that hydrogen vehicles have a much longer range and can also be easily configured for heavy duty vehicles such as buses and haulage vehicles.
Refuelling time is also a key advantage of hydrogen electric drivetrains. Most FCEVs can be refuelled in three minutes under the SAE J2601 refuelling protocol. This allows for fuel forecourt dispensing as refuelling takes a similar time to petrol and diesel. Even with fast chargers, residing on forecourts for 30 minutes is impractical and so charging (for passenger cars) is likely to be at home, with limited range.
Perhaps the most significant potential future benefit of hydrogen fuelled vehicles is the effect on our existing infrastructure. Hydrogen produced by electrolysis (splitting water) can be used to store renewable power and to balance the electricity network (by using electrolysers that can be turned on and off rapidly), providing sub-second grid balancing services. The energy is, therefore, exported from the grid in a managed way by the grid operators (at the right time) rather than by the car owner. This is possible because hydrogen can be easily stored. In addition, the electrolysers are connected on the UK’s higher voltage network which has overcapacity rather than plugging in BEVs on the low voltage network (at home) which is extremely expensive to reinforce because it is under the ground.
The efficiency and cost of electrolysis has also changed markedly over the past few years as volumes have increased. Electrolytic hydrogen made onsite now has cost parity with petrol and diesel in many parts of the world including the UK.
Despite the advantages listed above, the Company recognises that BEVs have a major role to play in cities to improve air quality and where range considerations and recharging times are less important. FCEVs however are the only currently available technology which can cost effectively address larger vehicles such as delivery vans and buses in city centres and long haul commercial vehicles throughout the UK.
About ITM Power plc
ITM Power manufactures integrated hydrogen energy solutions which are rapid response and high pressure that meet the requirements for grid balancing and energy storage services, and for the production of clean fuel for transport, renewable heat and chemicals. ITM Power plc was admitted to the AIM market of the London Stock Exchange in 2004. The Company received £4.9m as a strategic investment from JCB in March 2015. The Company signed a forecourt siting agreement with Shell in September 2015. The Group currently has £23.45m of projects under contract and a further £11.89m of contracts in [the final stages of] negotiation, totaling £35.34m (subject to exchange rate variation).