Discussing hydrogen energy in the rapidly growing material handling market and beyond, Rob Cockerill speaks to Tom Mutchler and is left in no doubt about the prospects of a hydrogen economy ahead.

No company knows refinery hydrogen like Air Products, nor has any company spent as much time developing hydrogen as a fuel.

With more than 60 plants and over 500 miles of pipeline, Air Products is the world’s largest producer of outsourced hydrogen to oil refineries, which use hydrogen to get the utmost out of every barrel of oil in the production of cleaner transportation fuels.

And with 110 hydrogen fuelling stations located in the US and across the globe, the company is leveraging its vast hydrogen experience and resources to drive forward hydrogen’s use as an energy carrier for fuel cell technology.

The ultimate goal? Taking the potentially cleaner, greener hydrogen economy from concept to reality.

Drawing on its expertise, Air Products now also sees opportunities for hydrogen technology in the fast-growing material handling market. Furthermore, lessons learned from the adoption of hydrogen energy in the material handling arena could prove to be an invaluable contribution towards a future hydrogen economy for all.

Those are the sentiments of Tom Mutchler, General Manager for Worldwide Equipment at Air Products, during an exclusive Interview of the Month with gasworld magazine.

“Material handling is a great microcosm of a deployment scenario for hydrogen energy.”

“The two fundamentals that will drive a viable hydrogen economy are the ability to use hydrogen on a mass scale obviously, and the ability to produce and deliver hydrogen,” he says. “What the material handling market affords is a clustering of demand.”

So what is the material handling market, and what’s so significant about clustering demand? Mutchler explains, “When we talk about material handling, it’s an elaborate term for warehouses and forklifts. Looking at a warehouse where there may be hundreds of forklifts in operation, there is a cluster of demand – it’s all in a central location. There are entities and firms out there that have made fuel cell equipment that’s viable for use in a forklift, and the consuming system is amenable to the economies of scale needed for the consumer market.”

“You have a cluster of hydrogen demand and a viable fuel cell as the enabler. Then when you think of the production and delivery of the hydrogen itself, at a reasonable size warehouse we’re doing around 300 hydrogen fuellings per week – that’s approaching the scale you need for a petrol station or gas station. Between 500-1000 fuellings per week is roughly the scale of a commercially viable petrol station.”

There are many advantages to using hydrogen powered forklifts and other material handling equipment. Hydrogen fuel cell-powered equipment needs refuelling once or twice daily, depending on use. In contrast, traditional battery-powered equipment must be placed temporarily out of operation for battery replacement and required battery recharging approximately every four to six hours. Hydrogen fuel cell-powered equipment provides consistent power strength during use and does not experience decreased performance or wear down as traditional lead-acid battery units do as they near a required battery change-out or recharge time.

Additionally, hydrogen fuel cell forklifts are not adversely impacted by temperature or by operating in coolers and freezers, in comparison to traditional battery performance. Further, hydrogen-powered fuel cell equipment is more environment-friendly because it does not involve lead-acid battery storage and disposal issues.

Air Products has made several material handling market announcements in the US. Air Products’ hydrogen and hydrogen fuelling technology infrastructure is currently being used to fuel 140 fuel cell powered forklift trucks at Central Grocers’ new distribution centre in Joliet, Illinois, with planned expansion for more lifts and fuelling infrastructure in 2010; 32 hydrogen fuel cell powered-forklifts at Nestle’ Waters North America in Dallas, Texas; and 40 hydrogen fuel cell-powered forklifts at the Defense Distribution Depot Susquehanna Pennsylvania in New Cumberland, Pennsylvania to name only a few locations. The company expects to make several announcements of new projects in 2010.

With hydrogen energy clearly a proven resource in the material handling market and these fuellings approaching economic viability akin to conventional petrol stations, a world powered by hydrogen in the future doesn’t seem so inconceivable.

Big business
Hitting the rewind button, Air Products’ roots in the hydrogen field can be traced back to 1957 – when the company became involved with a hydrogen facility to support the space programme in its native US.

“Since then,” Mutchler explains, “it’s been a business that we’ve grown through the 1960s, 1970s, 1980s and with really phenomenal growth experienced in the 1990s, in serving refineries with hydrogen to treat crude oil in the production of petrol. That’s where most of the scale that Air Products has built over the past 15 years started, in the early 1990s.”

As we move on into 2010, this is a business sector that Air Products values at around $1.5-2bn and is fast growing. Given that the company’s yearly revenues are between $8-9bn, hydrogen accounts for a ‘fair share’ of its operations.

As the largest merchant producer of hydrogen in the world, with a market share of around 50%, Air Products produces around two billion cubic feet per day of hydrogen and operates a ‘sizeable footprint’ across the globe. Whereas much of its many decades of experience is in the Refinery Hydrogen business, the last 10-15 years have seen the company actively engaged in the hydrogen energy sector and the transition to using hydrogen as an energy source.

Mutchler explains, “We have over 110 hydrogen fuelling stations and we currently participate in 17 countries with those stations. What does that mean? Well, we’re doing roughly 135,000 hydrogen fuellings per year, and that number should grow by 20-25% over the next couple of months. There are some phenomenal growth rates in the amount of fuelling we’re doing, which spans across vehicles, forklifts, cell towers, submarines – a whole number of applications.”

“While a lot of people tend to centre on the car, there are viable hydrogen energy deployments going on around the world today. The material handling, or forklift, market is one of those markets that is showing some phenomenal growth.”

This fast-emerging application is clearly an eye-catching demonstration of the safe use and economic viability of hydrogen energy. So is that the only link to a hydrogen economy? How is hydrogen use in material handling relevant to hydrogen as a general transportation fuel?

Parallels
Infrastructure is often cited as the biggest challenge to a hydrogen economy for cars and other vehicles, but this is not necessarily the massive obstacle many might think it is.

Mutchler points out that it was the same scenario for electricity, oil and natural gas; the conventional systems we have today didn’t just ‘pop up’ overnight. “At the moment there’s only a couple of hundred hydrogen fuel cell cars in the world, so each hydrogen fuelling station that serves the car market is a fairly lonely existence.”

In the meantime, there’s much to be learned from the application of hydrogen in the material handling market.

“Consider a fleet of forklifts at a warehouse, with 300 fuellings per week. With that kind of volume, you are at the point where economics kick in. Hydrogen-fuelled forklifts and other material handling equipment require all the same elements that we will eventually need to supply the transportation market, in terms of production, distribution and dispensing.”

“What I think this application also reinforces is that hydrogen is safe. With 135,000 fuellings per year and growing at a healthy rate, I have no doubt that hydrogen is a safe, economically viable energy carrier for fuel cell technology.”

“A hydrogen dispenser for a forklift looks very much like the equipment used for fuelling an automobile with hydrogen,” adds Ed Kiczek, Director of Hydrogen Energy Systems at
Air Products. “And it’s the same for the delivery; getting from point of production to point of use for the material handling market has very strong parallels with what we can see for cars.”

“There are up to 20 ‘very strong’ prospects waiting in the wings in the US, UK and Germany for example, where these projects are beginning to see the same value for hydrogen energy deployments as Air Products has witnessed for the transportation market.”
Kiczek believes the ability to draw parallels between hydrogen in forklifts and in conventional vehicles is a huge benefit of this application of hydrogen energy. He adds, “One of the biggest advantages of the material handling market is that you’re able to duplicate the fuelling station dynamics that you would see in a petrol station or a gas station.”
“From a fuelling standpoint, but also from a consumer standpoint, we’re learning from the consumers and how they handle the process - that allows us to learn from that experience and improve the products as we move towards a full hydrogen economy.”

Convinced
Knowing the economics of hydrogen and what it costs to produce and distribute hydrogen, Mutchler says he is absolutely convinced by the prospect of a hydrogen-fuelled society in the future.

“Here in the US, there are about 1200 miles of hydrogen pipeline and Air Products operates several fairly extensive hydrogen pipeline networks. (As for) the whole notion of distribution infrastructure and production of hydrogen, the technologies and the economics are known. A lot of credible data exists to prove these points.”

“Any paradigm-breaking transformation has its challenges. The proposition works, and the scale works,” he enthuses. “The scale with any energy transformation is daunting. But it’s do-able, it is absolutely do-able – we are so convinced that it’s possible, as are other people, we’re not alone.”

Mutchler points to two breakthroughs: “One is the notion of clustering fuel stations as well as a large-scale car deployment. There’s a project in the works around this clustering concept, where we will be able to show the exponential benefit of larger scale.”

“The next one, demonstrating the green aspects of hydrogen, is the deployment we have for the coming year, where we’ll be taking the digestor gas off of a sewage treatment plant in California and converting that to hydrogen power, electricity, and steam. That’s a project that’s already underway and will be deployed in the second quarter of this year (2010). It’s an avenue towards green and renewable hydrogen.”

In conclusion, Mutchler makes a clear point, “It’s not as if the public needs to step up in 10 years time with billions or trillions of dollars to do this. There are tremendous opportunities for hydrogen now, the economics are known, and Air Products is taking the lead.”