Ballard’s Tim Sasseen on the Operational Flexibility of Hydrogen Fuel Cells

Tim Sasseen

Ahead of VX Green Hydrogen Discussion Forum Webinar #1, VX News spoke with panelist Tim Sasseen, Ballard Power Systems’ Market Development Manager, to discuss the transitioning market for hydrogen fuel cell technology. As the energy economics of green hydrogen respond to meet growing demand for energy-dense, zero-emissions fuel, Sasseen unpacks the advantages of hydrogen fuel cells for medium and heavy-duty transportation applications

Elaborate on Ballard’s niche in the renewable hydrogen revolution that’s growing globally; what’s the market play for Ballard, especially in North America?

Tim Sasseen: Ballard started 41 years ago in transportation hydrogen. We’re all about heavy-duty applications and our value proposition is all about reliability. Our market play is to create a mature product that’s going to fit the kind of power application that we’re going to need for 100 percent decarbonization. We turn hydrogen into heavy-duty electrical power, and we produce the components that electric vehicles and all these burgeoning heavy-duty segments are going to need in the future. We distinguish ourselves with a very solid and very deep track record.

According to Bloomberg New Energy Finance, “governments, energy giants, automobile companies, lobbying groups say hydrogen use is pivotal for cutting greenhouse gas emissions quickly enough to prevent the worst effects of climate change. That's triggered a global race to stake claims of what could be a $700 billion business by 2050.” What's Ballard’s assessment of the potential for hydrogen’s mobility to market?

We have no doubt that hydrogen is going to be a key building block for a fully decarbonized energy sector. We know that the scalability of hydrogen power systems really enables that transformation; you can expand the amount of energy you can provide by simply expanding the amount of gas that you store.

We have a multiplicity of supply vectors for that energy carrier. And remember, hydrogen being an energy carrier, not an energy source, means you can start with any energy you like—be it wind, solar, nuclear, or biofuels—and turn that into something that's not going to emit on the other side, except for water. That characteristic plays a key role, especially when we look at different technologies like geologic storage, which is going to add capacity that no other technology can provide at any comparable level of economic feasibility.

Our timelines for climate change are very short. We know that we have to act soon and with technologies that are ready to go. We've got enough road experience on hydrogen fuel cells to show that we're ready to get those zero emissions solutions up and implemented right away, so we fully agree with BNEF’s perspective.

Regarding price points, Ballard and Deloitte recently published a report that found within 10 years, it will become cheaper to run a fuel cell electric vehicle (FCEV) than a battery electric vehicle (BEV) or an internal combustion engine (ICE) vehicle for commercial vehicle applications. Is that pertinent to the business development that you're seeing as opportunities in California?

Cost reduction is going to be driving the market in a serious way. A lot of that reduction comes from high volume manufacturing. Those who tuned into the Tesla Battery Day saw a lot of the production technology that they're implementing to bring their cost down more than 50 percent.  We're doing exactly the same thing. Our cost reductions up to today have come largely from technology improvements; now we're just starting on the volume approach. We’re implementing roll-to-roll continuous manufacturing at our headquarters now, and we're multiplying our production rates by six.

At the same time,  fuel cost is a key part of this whole story. What enables low-cost, zero-carbon hydrogen is low cost electricity, and that comes from very large-scale renewable installations, such as solar and wind installations that are in the hundreds of megawatts.  At that scale, you can get power for 1-3 cents per kilowatt hour, and that provides hydrogen that’s not only cheaper than conventional fossil fuels, but also very competitive with grid supply electricity, particularly in grid constrained areas.

Beyond that, we know resiliency is a huge issue.  You can address that by beefing up the grid with lots batteries and new high-tension lines in very sensitive areas., but in California, we know the pitfalls of doing that. We're suffering through a highly grid-dependent energy system right now, and we need the multiplicity of supply vectors that hydrogen can enable. All of these factors will make an economic case and bring hydrogen and fuel cells to the kind of cost points Deloitte speaks to in the very near future, before the end of the decade.

Elaborate on the common perception in California that battery storage and hydrogen fuel cells are market competitors. Are they?

The truth is that it's a false competition, similar to what the wind energy industry underwent around 2000. I worked in wind at that time, and a lot of solar advocates were pushing against wind energy, mostly because they were vying for the same funding sources. What we found as the wind industry matured, was that despite the fact that it had more moving parts and a steeper reliability curve to ascend, it achieved equal rank with solar as a key renewable energy resource.

The kind of reliability that is needed for the grid places wind and solar as complimentary technologies. Wind and solar can actively provide the kind of power you need in different locations, for different value propositions. Wind is less time dependent; it'll blow at night, but it is more mechanically complex. Solar is very simple but has the time dependency of the sun.

It's very similar with hydrogen fuel cells and batteries. Batteries are time limited by how much range you can get out of them and how fast you can charge them, but they are very simple to understand. You can put together an electric vehicle very easily these days. The components for battery vehicles are largely commodified, whereas hydrogen fuel cells today need more specialized componentry.

The analogy is very pertinent, and we see it on the growth curve for the volume of vehicles that are produced. If you plot manufacturing volumes for PV, solar, and wind on a logarithmic scale versus cost, you'll see that we're tracking that curve very well, and we're about to experience  those volumetric decreases.

So it's not a competition; it really is a complimentary technology portfolio. You need batteries for very low-cost applications, where you have limited duration usage of the vehicles. For longer-range continuous-duration applications, hydrogen fuel cells provide economic superiority. They complement each other, and in fact, in most fuel cell transportation applications we use both.

Ballard has technology partnerships with several bus OEMs, which have included Ballard fuel cell modules on their electric bus platforms. Elaborate on those partnerships and what you see as the near term marketplace opportunities for Ballard.

We've had very successful partnerships, particularly with New Flyer and ElDorado here in the US and with our end customers. We have three different transit agencies in California today that are running fuel cell buses, and another three are just coming online with procurements. When you look at SunLine Transit, for example, they've been running fuel cell buses for over 20 years, and we're finding that the costs are coming down very rapidly.

If you look at the Department of General Services RFO for zero-emission buses, you'll see that between the nearest equivalent battery electric buses and fuel cell buses, the initial price is within 11 percent for the fuel cell bus—if you add in the 12-year warranty costs, we’re within 2 percent, and with substantially longer range and operational benefits. That really speaks greatly to engagement at the level of the bus OEMs. New Flyer has also achieved incredible fuel economies beyond what we expected for those buses, which further improves the value proposition. And as more transit agencies get interested, the OEMs are stepping up their engagement and marketing opportunities.

Whereas we used to have to present the entire value proposition of hydrogen to potential end users, now we have OEMs that are bringing buses around to companies and fuel providers that are actually sitting with us at transit agencies explaining this value proposition. About a third of the most recent Innovative Clean Transit (ICT) rollout plans in California, which are required by that mandate, have been submitted to CARB, and about a third of those bus procurements for 2040 are  fuel-cell electric buses.

There's overwhelming support for the promise of fuel cell electric buses to meet the very high demands of transit, and I think our OEMs are starting to see that more and more. In fact, we're seeing new interest from OEMs that haven't yet participated in fuel cell electric buses, wanting to start their own fuel cell electric bus programs.

Speak to the role of California’s regulatory policies relating to hydrogen fuel cells. Are they presently enabling or inhibiting the market for fuel cells from realizing its full potential?

We have to give credit to the battery vehicle manufacturers for enabling and emboldening California agencies and legislature to set such aggressive targets. Elon Musk really gave people something to think about with the success of Tesla, and those cars getting on the road at such high penetration let our policymakers know they could set targets like carbon neutrality by 2045. That was the catalyst was for the kind of change that we've seen, which now brings attention to hydrogen fuel cells and what hydrogen needs to serve in that role to enable full decarbonization.

The agencies in California can’t be blamed for focusing first on these easy early battery deployments. Deploying battery electric vehicles has been quite easy while penetrations are in the single-digit percentages. You're not taxing the grid to a great amount, and you don't have to put in a whole lot of difficult infrastructure, so it makes sense that battery vehicles have gotten out first and in higher numbers.

We've done a lot of work educating both the Air Resources Board, the Energy Commission, as well as the legislature about what the hydrogen value proposition is, and they are starting to get it. Mary Nichols at CARB definitely gets it. When the Air Resources Board puts out new incentive programs and new regulations, they're looking very strongly at balancing both technologies. If you look at the Advanced Clean Truck regulation, they've made a very concerned and clear effort to keep opportunities open for both batteries and fuel cells.

The Energy Commission has largely been responsible for the evolution of the grid and the evolution of delivered electricity, so hydrogen has been outside of their scope.  However since Patty Monahan has come on as their commissioner responsible for transportation, she's taking a very hard look at hydrogen. The more she looks at it, the more she is convinced that it’s necessary, particularly for heavy-duty applications. We’re seeing the Energy Commission put up specific grant opportunities now for hydrogen in new sectors like rail and marine.

The agencies of California have historically put out a lot of money towards battery vehicles, but they are evolving. We look towards continuing and increasing participation by those agencies in hydrogen. What needs to happen now is to differentiate those complementary roles that battery and hydrogen can play, and really tailor funding strategies towards evolving paths that suit each technology best, rather than trying to make them both do exactly the same thing.

Address the marine sector and ports; has Ballard interest in both?

Ballard is very interested in the marine sector. We've recently initiated a launch of a product called FC Wave which is designed specifically for marine applications. It's been developed out of our European office—because there's been a lot more movement on the European side for hydrogen in the marine sector—but we're moving FCwave into the US, with project teams to put together vessel designs that incorporate this.

The ports are an obvious place where hydrogen has to play a serious role. The amount of energy that's required just to move goods from ocean-going vessels to rail and trucks is enormous.  Using conventional fossil fuels has generated a really unfortunate pollution signature that people at the ports feel every day.

When you look at the asthma rates in Wilmington, it's 17 percent above the surrounding area. The energy for the ports need to be addressed, but what needs to be understood better is the role that hydrogen can play in putting in that new infrastructure. When you talk about putting in tens or hundreds of megawatts of new electrical infrastructure in a place as built out and dense as the ports of LA and Long Beach, you start to see some real problems, not only with costs, but in the practicality of moving in and out that kind of power. Having hydrogen as an option is going to be a major part of the port’s strategy to help them with their very aggressive goals for 2035 and beyond.

Both you and Ballard will be a part of the VerdeXchange Green Hydrogen Forum about to take place this fall and winter. Talk a little bit about the stakeholders in this industry that are coming together to accelerate the growth of hydrogen in the fuel mix economy of California.

The first and foremost stakeholders are the people of California as represented through environmental justice groups. We have a lot of work to do to help them to understand the role that hydrogen can play, not as a foil for fossil fuels, but as a transition fuel away from fossles that allows continued economic activity and job growth while eliminating GHG’s and criteria pollutants.

The energy providers are also major stakeholders. We know the electric utilities have a very large market change ahead of them serving electric vehicles. The natural gas providers need to find a future as well. In California, many cities are banning new natural gas installations, so the transition to hydrogen has a major interest to those kind of energy providers.

Fleets are increasingly going to be very interested in the role that hydrogen can play. The Advanced Clean Truck regulation and the upcoming Advanced Clean Fleets regulation are going to put strong regulation on industries that have very tight profit margins, even as they exist today. Putting new technology as a requirement for their operations makes them interested in ways to make it compatible with their operations, and that's what we've seen on the transit side.

The most compelling value proposition of hydrogen fuel cells in transit is  operational flexibility. Transit operators can continue to operate their fleets in the way that they've been doing, without making drastic changes to workforce, their operations, fueling, and timing that the transit agencies and transit customers need. The component manufacturers, like Ballard, are going to be serving a very strong role in helping educate policymakers and environmental justice groups to understand where hydrogen plays a role. The vehicle manufacturers are going to have to come up to speed too to make their choices, and how they're going to make these different variants of battery electric and fuel cell electric vehicles. Everybody's going to have to come to a common vision very soon, because, as I said, the timeline for climate change is very short.

“We're suffering through a highly grid-dependent energy system right now, and we know that we need the multiplicity of supply vectors that hydrogen can enable.” —Tim Sasseen
“Hydrogen is an energy carrier, not an energy source, so you can start with any energy you like—be it wind, solar, nuclear, or biofuels—and turn that into something that's not going to emit on the other side, except for water.”