ROCHESTER, New York—About 100 miles from Niagara Falls, where Nikola Tesla’s hydroelectric power plant design—a landmark in renewable energy—was first implemented (way back in 1895), a hydrogen energy solutions provider called Plug Power is building out one of this century’s most ambitious energy projects: a green hydrogen highway.
Green hydrogen is created using only renewable energy such as wind, solar, and hydroelectric to power the electrolyzers that separate water into hydrogen and oxygen using anodes and cathodes. The Albany-based Plug makes those, along with the fuel cells that convert hydrogen fuel and air into electricity. Currently, most hydrogen is made using natural gas—via steam method reformation—to power the electrolyzers, but Plug hopes the green variation will catch on as countries and companies try to reach carbon neutrality.
“Hydrogen is really the Swiss Army knife of this transition to renewable energy,” explained Andy Marsh, Plug’s president and CEO.
Hydrogen also happens to be the most abundant element in the universe, so there’s plenty to go around.
“With green hydrogen, zero carbon emissions are produced,” offered Mike Roeth, the executive director of the North American Council for Freight Efficiency (NACFE). “It is, in essence, the gold standard of hydrogen in the clean energy sector.”
NACFE, and many others in the transportation industry—which accounts for 70% of greenhouse gas emissions—are bullish on the benefits of green hydrogen.
Hydrogen fuel in general is seen as an enticing alternative to diesel for commercial vehicles and power generation. It has three times the energy density of diesel fuel (120 megajoules/kg vs. 45.45 MJ/kg).
“As fleets are required to move to cleaner alternatives, hydrogen serves as an excellent zero-emission ‘one-for-one’ replacement for diesel,” noted Katrina M. Fritz, executive director of the California Hydrogen Business Council. “Fuel cell electric vehicles (FCEVs) that are powered with hydrogen enjoy long range, limited maintenance, and short refueling time. This makes FCEVs ideal for duty cycles of commercial trucking fleets.”
Benefits of fuel-cell trucks
In the over-the-road segment, FCEVs also are expected to have a range more comparable to diesel trucks, while battery-electric trucks are under 300 miles. The Tesla Semi recently reached 500 miles on one charge, though how much of its 81,000-lb. GVWR was battery and how much was freight is unclear.
An FCEV using green hydrogen also has sustainability advantages over any battery-electric vehicles that source their electricity from fossil-fuel power plants. At least for now, an electric truck takes 30 minutes using a DC fast charger, a method that early testing indicates reduces overall battery capacity over time, while liquid hydrogen pumps about the same rate as diesel, or under 15 minutes.
Marsh said a Class 8 truck requires 1-MW of power, and to get more range, they need to add more batteries. These are very heavy and would limit the amount of freight the truck could haul, he noted.
Read more: Kenworth, Toyota prove out real-world benefits of FCEVs
Because of these benefits to a fleet’s operation and sustainability, Plug envisions commercial FCEVs taking up a substantial share of the road.
“Some of our larger customers in logistics tell me that they believe at a minimum 30% of the last mile will end up being fuel cells, and a maximum 70%,” Marsh said, citing a European customer’s projections. “A lot has to do with how you keep that asset on the road. You can fill it fast, run twice as long, and end up with having fewer assets.”
The current challenge is that the cost to produce the fuel source has been too high to make it cost-effective. Particularly in trucking, green hydrogen must get closer to price parity with diesel for any significant adoption.
This is where Plug comes in. The company doesn’t only want to create a renewable source of fuel but an affordable one as well. The company has more than 50,000 e-mobility units in the field, virtually all fuel cell forklifts, and that volume and scale have benefited Plug at the plant level.
“Every time we doubled the number of units in the field, our costs declined by about 25%,” relayed Marsh.
This will benefit customers of both the hydrogen fuel and fuel cells. Those customers are few and far between now, but soon they will be as emissions regulations ramp up. Several truck and powertrain manufacturers have hydrogen-powered fuel cell electric vehicles in the works, from Cummins to Paccar. Daimler Truck AG and Volvo Group AB are pooling resources through a joint venture called cellcentric to develop efficient fuel cells, while publicly traded startups such as Nikola Corp. and Hyzon Motors have gone it alone, which had led to frays with short sellers, and eventually, leadership changes.
Read more: The dawn of hydrogen trucks
Save for a fuel-cell electric delivery van called the HyVia H2-TECH, developed through a joint venture with Renault in Europe, Plug has no immediate plans to produce commercial vehicles. The company has found success selling fuel-cell forklifts for about nine years, though. Instead, the company founded in 1997 is focusing on green hydrogen production solutions and fuel cells.
“We're happy to sell anybody fuel. We're happy to work with anybody with their fuel cells, we're happy to sell anybody electrolyzers if they want to make their own fuels,” Marsh said. “We're arms dealers—we're happy to sell anything.”
And Plug has a lengthy head start in building the infrastructure and service and distribution network needed to make this renewable energy source more readily available by the end of the decade. As previously stated, it all starts in Upstate New York.
Plug’s plan
In October, Plug invited partners, customers, analysts, and select media (including Fleet Maintenance) to its annual symposium, held at the Plug Power Innovation Center, a 155,000-sq.ft. gigafactory located in West Henrietta, a quiet suburb of Rochester. Plug sources its electricity from low-cost hydroelectricity from the Niagara Power Project to make hydrogen onsite and power the facility.
Built in 2021, the gigafactory manufactures the membrane electrode assemblies, key components in the company’s electrolyzers and fuel cells, at a clip of 2 million per year. These thin metal pieces, the size of license plates, are stacked on top of each other like reams of paper and allow for the molecular manipulation of hydrogen and oxygen. For electrolyzers, these channels the chemical process of splitting water molecules into hydrogen fuel and oxygen; for fuel cells, they convert hydrogen into electricity. Plug also has 31 other facilities used to process hydrogen, make other parts and systems, and for distribution and service.
The innovation center showcases the various technologies, including the electrolyzer stacks, pumping stations, and bulk fuel haulers that carry the liquid hydrogen, which reaches a frosty -452 degrees F. During an evening welcome party, guests also got a good look at the MEA manufacturing process via guided tours.
The next day, Marsh and other Plug executives deluged investors, analysts, and current and potential partners with a thunderous cascade of case studies, agreements, testimonials, and projections up until the end of the decade to show how the company will expand the length of its hydrogen highway.
By 2025, Plug plans to produce 500 tons of liquid green hydrogen per day, and double that by 2028. This year Plug’s capacity is 9.1 tons per day. Customers include Amazon, Home Depot, Microsoft, General Motors, Stellantis, and Walmart. Plug expects to generate $20 billion annually by 2030. If achieved, this would be a 1,400% increase from 2023 estimated revenue ($1.4B) and a 400% increase from 2026 ($5B).
Plug had fallen short of 2022 production estimates, but one thing that will help the company, and burgeoning hydrogen sector overall is the Inflation Reduction Act (IRA) passed this year.
“The biggest winner in the energy market for the IRA was hydrogen,” Marsh said.
The IRA specifically allows up to a $7,500 tax credit for light-duty commercial vehicles (14,000 lb. GVWR) and $40,000 per medium- and heavy-duty (>14,000 lb. GVWR). Along with these incentives, the IRA includes specific clean hydrogen production tax credits, and users can stack other tax credits associated with hydrogen storage.
“The IRA is going to let the market decide and dictate how the hydrogen economy will grow,” Marsh concluded.
The Infrastructure Investment and Jobs Act also includes $1 billion for a Clean Hydrogen Electrolysis Program that cuts green hydrogen costs and the Department of Energy’s Hydrogen Shot program is working to reduce green hydrogen cost from $5/kg to $1/kg in a decade.
Plug also recently entered a strategic collaboration with Nikola to buy 75 Nikola Tre FVECs to haul their liquid hydrogen tankers. Nikola claims the Tre FCEV has a 500-mile range, and the first units will enter Plug's fleet in 2023.
Plug in turn will provide Nikola with a liquefaction system in Buckeye, Arizona to produce 30 metric tons of hydrogen per day, along with an agreement to supply the truckmaker with 100-125 tons per day. Nikola plans to bundle the vehicle, fuel, and service into one fee, and has its own energy business. They, too, are amped up over the cost benefits provided by the IRA.
"The Act is expected to provide significant benefits to Nikola through production and investment tax credits, direct pay provisions, and other incentives that are expected to lower the cost of hydrogen, dispensing infrastructure and trucks for Nikola and our customers," Nikola President Michael Lohscheller said.
Plug's fleet customers
Marsh credits Walmart as motivating Plug to develop all its solutions.
“Walmart was the one who told [us] to become more vertically integrated to meet their needs,” Marsh recalled. To feasibly choose Plug as their hydrogen provider, the big-box retailer wanted the hydrogen fuel, fueling stations, and aftermarket service, Marsh continued.
Amazon also signed a deal with Plug for 30 tons/day of green hydrogen, or 11,000 tons/year.
He also mentioned Plug is developing electric vehicle charging stations powered by fuel cells.
This is enough fuel to power 30,000 forklifts or 800 heavy-duty trucks annually.
“We already have more than 70 fulfillment centers outfitted with hydrogen storage and dispensing systems, allowing us to start using green hydrogen to replace fossil fuels,” shared Dean Flourten, VP of global engineering at Amazon, via a pre-recorded message. “And by 2025, we plan to add 20,000 fuel cell forklifts across 100 fulfillment centers.”
By the end of the decade, as Plug’s production grows and theoretically comes down in price, a good chunk of Amazon’s fleet could rely on fuel cells.
“We're exploring and testing the use of other hydrogen applications, such as hydrogen-powered trucks and vans in our middle mile and last mile fleet,” Flourten said, adding the caveat that “freight transportation is a difficult part of the logistics industry to decarbonize.”
Another Plug customer, FreezPak Logistics, a cold chain company out of New Jersey, doesn’t have nearly the scale of Amazon, but has the same end goals.
“We made a decision that hydrogen fuel cells are going to change our businesses,” said David Saoud, co-CEO of FreezPak, who along with his brother, spoke at the symposium.
The company has been a Plug customer since 2014, after seeing a fuel cell forklift on display at a New York farmer’s market.
“My brother and I looked at each other like, ‘we need this thing—tomorrow,’ Saoud said emphatically. They now have 100.
He credits the move with allowing FreezPak a clear competitive advantage, as speed is vital in cold chain transport.
“We have gained a productivity boost of 100%,” Saoud said. “And it's really amazing to see a forklift charge in 90 seconds, as opposed to charging a lead acid battery, which takes 10 hours to do that.”
Furthermore, as electric forklifts would reach the end of charge, they would drop from 7 mph to 4 mph, while the fuel cell forklifts are more consistent.
According to Saoud, FreezPak has cut electricity costs by nearly one-third after switching to hydrogen. The change also opened up 5,000 to 10,000 sq.ft. more warehouse space per facility for products that was previously used to store additional batteries.
“Our real estate costs about three times the amount of a dry warehouse, so every inch of that warehouse is very expensive,” Saoud added.
FreezPak has hydrogen infrastructure at three facilities currently, with eight more on the way, after a new agreement with Plug. Four facilities are under construction, with possibly 15 more added by 2030. FreezPak will buy 400 more fuel-cell forklifts as well.
Now Saoud is waiting for the day when the fleet’s 50 trucks can convert to hydrogen, which would substantially increase their investment, as the hydrogen infrastructure will already be in place at the facilities.
“Diesel is very expensive, and the maintenance of those [FCEVs will be] going down,” he said.
“We can use those tractors to service the ports,” Saoud added. “That's huge for tax credits because I know the ports are going to want clean energy, like in California.”
