Copyright of Shell Alternative EnergiesMay 5, HYDROGEN REFUELING COST REDUCTION TO ENABLE COMMERCIALISATION National Hydrogen Association 2010 Conference Shell Alternative Energies Use this area for cover image (height 6.5cm, width 8cm) Nikunj Gupta, Jurgen Louis & Brad Smith

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation H 2 AS A FUTURE MOBILITY SOLUTION PROVIDES….. Diverse Feedstock Base  Energy Security & Sustainability Demonstrated High Well-to-Wheel Efficiencies  Energy Use Reduction Demonstrated Lower Carbon Footprint  Lower Environmental Stress Demonstrated Full Range State-of-the-art Vehicle  Convenience Demonstrated Low Fuel & Vehicle Cost  Affordability  Remains to be demonstrated

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation FUEL CELL VEHICLE AFFORDABILITY ROADMAP Multiple OEMs have Demonstrated Similar Progress

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation FCV ROADMAP: Clear Line of Sight to Affordability Source: Dr. Massino Venturi - NIP Vollversammlung 26 March 2010 (edited)

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation Date 12/09/ What’s the Status of Affordability of Hydrogen Fuel ? What’s the Roadmap? What About Low CO 2 Options?

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation HYDROGEN FUEL VALUE CHAIN: Status & Imperative At present H 2 Distribution & Refueling take a large share of the costs BUT in future expected to be more like gasoline

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation (Reference) LOW CO 2 HYDROGEN PRODUCTION: Multiple Viable Options Clean  Carbon Capture Ref.: Shell WHTC 2009 Paper

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation HYDROGEN DISTRIBUTION: Options & Status Gaseous trucking is expensive due to low capacity, shall be substituted in future due to scale limitations Liquid (Liquefaction + trucking) is capital intensive but optimisation opportunities are available Pipelines also capital intensive and only an option for a more mature market Hydrogen cost contributions Now Future Production Distribution Refueling Significant cost reductions necessary and possible in Hydrogen Distribution – recommend continuous efforts

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation REFUELING COSTS: Significant Opportunities for Reduction in Equipment Costs Refueling cost contributions CAPEX Refueling equipment & system integration Equipment Installation Site engineering, design and preparation Other costs  Cost reduction is imperative O&M Land Lease Fixed Costs Variable Costs  Expected to be similar to gasoline Refueling CAPEX break-out

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation REFUELING COST REDUCTION ROADMAP: Hydrogen Refueling is Expected to be More Expensive than Gasoline (Unlike FCVs) Gen I: prototype stations ( kg/day) – cost are scaled-up to1000 kg/day Gen II: first small series stations of the same design Gen III: commercial stations of the same design Based on 1000 kg/day (volume) pipeline supplied station Supplier cost reduction Scaling effects ~50% reduction Supplier cost reduction Scaling effects Technology advance ~50% reduction Including simplification ~60/70% reduction Up to station stations stations ? Gasoline ($/kg eq )

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation Options:  Higher Pressure Pipeline/Lower Pressure Storage (P pipe > P tank ) - Eliminate compression & storage at station  Liquefaction Technology – Efficient ways to simplify & reduce costs  Liquid Thermal Compression – high throughput, thermal compression of liquid utilizing the energy stored in the liquid TECHNOLOGY ADVANCEMENT: Opportunities for Cost Reduction (patent pending)

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation Options:  Vent setback requirements (C&S) – significant reduction in station footprints & site development costs  Simpler refueling protocols – reduction in control hardware & dispenser costs (Ref: Honda NHA 2010)  700 Bar v/s 350 Bar - 30% reduction in potential costs STATION SIMPLIFICATION: Opportunities for Cost Reduction 100 kg/day station

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation Recommendations  Cooperation on technology advancements/next-gen stations  Cooperation on station simplification  Standardization & competition on station development SUMMARY & RECOMMENDATIONS  Cost reduction of hydrogen supply is essential for success of hydrogen mobility, much like FCV costs  Hydrogen refueling & distribution costs represent the biggest gap and present ample opportunities for cost reduction  The main avenues for refueling cost reduction are  Technology advancements  Station Simplification  Increased competition in the supply chain  Standardisation of station designs  “Mass production” of station components

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation Contact Info Nikunj Gupta Technology Advisor – Hydrogen

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation APPENDIX A: Refueling Cost Roadmap (LH 2 Based Station) Gen I: prototype stations ( kg/day) – cost are scaled-up to1000 kg/day Gen II: first small series stations of the same design Gen III: commercial stations of the same design Based on 1000 kg/day (volume) LH2 supplied station Supplier cost reduction Scaling effects ~50% reduction Supplier cost reduction Scaling effects Technology advance ~50% reduction Including simplification ~60% reduction Up to station stations stations ? Gasoline ($/kg eq )

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation APPENDIX B: Cost Reduction Pathway Cost reduction - Generation I to II Change of focus from technology demonstration to low cost stations Design cost spread over more stations Increased competition station suppliers Expected cost reduction - Generation II to III Reduced hydrogen equipment cost due to larger production numbers Increased competition between component suppliers Technology improvement Potential station simplification leading to Generation III* Reduced refueling pressure Simplified refueling protocols Improved hydrogen station safety standards

Copyright of Shell Alternative EnergiesMay 5, Hydrogen Refueling Cost Reduction to enable Commercialisation APPENDIX C: CAPEX Estimate Basis