Business of Hydrogen and Fuel Cell Forklifts

in South Carolina

Shannon Baxter-Clemmons, PhDSouth Carolina Hydrogen and Fuel Cell Alliance

Scott Greenway, PhDGreenway Energy LLC

June 16, 2011

This presentation does not contain any proprietary, confidential, or otherwise restricted information.

Hydrogen 101

• A non-profit public/private partnership of academic, government and business coordinating resources in South Carolina to advance commercialization of hydrogen and fuel cells.

• Areas of focus:– Education and Outreach– Infrastructure Development– Policy Development and

Implementation

– Research and Technology Transfer 

The South Carolina Hydrogen and Fuel Cell Alliance

Hydrogen 101

2010 & 2011

South Carolina is one of the Top 5 Fuel Cell

States

State of the States:Fuel Cells in America

Top 5 (alphabetical) California, Connecticut, New York, Ohio, and South Carolina.

Hydrogen 101

SC Hydrogen and Fuel Cell Permitting Law

•Passed into law in 2010

South Carolina is the first state in the US to permit hydrogen and fuel cell deployments at the state level using existing internationally recognized codes and

standards.

•Policy is a result of cooperative work between:

•state officials •industry representatives •codes and standards experts •Municipal Association of South Carolina

Hydrogen 101

Hydrogen 101: State and Local Government Education

• DOE Award implementation started in 2008• Goal: To accelerate the on-going construction of

the hydrogen economy in South Carolina and the Southeast by providing accurate and reliable information to state and local decision-makers.

• Initially started with educating state and local decision makers

• Definition of “decision makers” shifted to include bureaucrats, economic developers, and business decision makers.

• Greenway Energy developed economic models

Hydrogen 101

Feedback

– H2 technologies sound good, but it would be good to better understand applications where they financially make sense

– What is the status of the technology? When will we see everyday applications of fuel cells?

– Where does the hydrogen come from?– How can we improve market adoption?– How can I help?– Financial support is tough in this economy but

what other things can we do to promote the technology in the marketplace?

Hydrogen 101

• Bridgestone-Firestone Plant • GENCO warehouse in Aiken, SC• Creates jobs for operation,

maintenance, and distribution of technology

Hydrogen Fork-LiftsMarket Value Proposition

Key Strategy to increasing hydrogen through put of

local hydrogen station

Hydrogen 101

Activities in Response to Feedback• H2 501 – Early Markets for Hydrogen Technologies

– H2 Technology Case Studies

• H2 Lift Truck Case Study

• Telecom Backup Case Study – (Under review with Economic Dev. Focus Group)

• Combined, Heat, and Power (CHP) Study– (Under review with Economic Dev. Focus Group)

– Novel consensus economic models used to help decision makers understand opportunities

– Working with 3rd parties – economic developers and technology consultants to improve model output utility

– Developing case study parameters to best illustrate ideal and borderline cases

– NEW Hydrogen 101 Webpage• Case Studies and Company (Trulite and Proterra) “Value Proposition”

models to be posted on a new webpage, Summer 2011

Hydrogen 101

Fuel Cell Applications in the Near Future

• Battelle Report identifies key early PEM fuel cell markets:

– Back-up Power– Lift Trucks– Airport vehicles

• Other Markets for Fuel Cells– Combined Heat & Power

Hydrogen 101

Fuel Cell Lift Trucks

Class 1 – Sit Down Truck Class 3 – Ride Behind Palette Jack

Hydrogen 101

Battery vs Fuel Cell Forklifts

5-10 min~ 8 hr

~ 6 hr

~ 6 hr(no fade)

~ 2 hr(fade)

15-20 min

~ 6 hr(no fade)

~ 2 hr(fade)

Fuel Cell Forklift& Refilling Station

Battery Forklift& Charging Station

Battery Forklift& Changing Battery

Run Time

Volt

age 8 hr

Run Time

Volt

age 6 hr 2 hr

Difficulty to SteerDuring Voltage Fade

Hydrogen 101

Rules of Thumb

• Approx. 15-17 min/truck/shift of labor saved• A 5% reduction in trucks needed and

corresponding labor reductions• 5 year battery lifetime can be significantly

shorter in warm climates• Fuel cell lifetime is 10 years with regular

maintenance• Opportunity fueling means that a regular

battery change is not needed with each shift change

• Fuel cell lift trucks get 30% federal tax credit and have no SC sales tax

• 50% bonus depreciation may apply

Hydrogen 101

Value Proposition Fundamentals

• Class I - Battery Trucks– $5,500 battery– 20 min switch

(non-productive time)– 1 switch per shift– $1/ Op. hr. maintenance– 3 kWh/truck/hr– $0.072/kWh– $1000/truck/yr – Battery

Room Exp.– 5 yr. lifetime with

maintenance

• Class I - Fuel Cell– $40,000 fuel cell

– 3 min H2 fill(non-productive time)

– Opportunity filling– $1.5/ Op. hr. maint.

– 0.2 kg H2/ Op. hr.

– 1.8 kg tank in truck

– $5/kg H2 (molecule)

– $250k/yr H2 storage lease

– 5% Fleet reduction due to productivity gain

– 10 yr lifetime with maintenance

Hydrogen 101

Non-Amortized Cash Flow Analysis40 Truck Fleet

($1.0)

($0.8)

($0.6)

($0.4)

($0.2)

$0.0

$0.2

$0.4

$0.6

$0.8

$1.0

0 2 4 6 8 10 12

Project Year

Cu

mu

lati

ve C

ash

Flo

w (

Mil

lio

n $

)

Comaparative Fuel CellLift Truck Cost

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Lift Trucks Deployed in South Carolina• Bridgestone/Firestone

– 43 Class 1 Lift Trucks– 23 adopted in 2007, 20 additional in 2009– On-site hydrogen tube trailer delivery

• GENCO– 27 Class 1 Lift Trucks– Adopted in 2010– Liquid Storage from Sage Mill Hydrogen Station

• BMW– Phase 1

• 86 Units – Mixed Classifications

– Phase 2• 2nd fleet using Reformed Landfill Gas

Hydrogen 101

Lift Truck Analysis Conclusions

• In a 24/7 heavy operation, as few as 35 trucks can make a positive case due to battery life

• In lighter usage, about 40-50 trucks are a good starting point to consider the switch

• High labor costs are a strong driver for economics

• The price of Hydrogen comes down with use and is essential to economics

• Need high tax burden to take full advantage of federal tax rebates after 2010

• Payback can be less than 5 years in current market

• Cost of capital could add expenses if financed

Hydrogen 101

Contact

Shannon Baxter-Clemmons, PhDExecutive Director

baxterclemmons@schydrogen.org

1225 Laurel StreetColumbia, SC 29201

www.schydrogen.org