1. Copyright of Shell Alternative EnergiesMay 5, 2010 1 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

2. Copyright of Shell Alternative EnergiesMay 5, 2010 2 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

3. Copyright of Shell Alternative EnergiesMay 5, 2010 3 Hydrogen Refueling Cost Reduction to enable Commercialisation FUEL CELL VEHICLE AFFORDABILITY ROADMAP Multiple OEMs have Demonstrated Similar Progress

4. Copyright of Shell Alternative EnergiesMay 5, 2010 4 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)

5. Copyright of Shell Alternative EnergiesMay 5, 2010 5 Hydrogen Refueling Cost Reduction to enable Commercialisation Date 12/09/2015 5 What’s the Status of Affordability of Hydrogen Fuel ? What’s the Roadmap? What About Low CO 2 Options?

6. Copyright of Shell Alternative EnergiesMay 5, 2010 6 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

7. Copyright of Shell Alternative EnergiesMay 5, 2010 7 Hydrogen Refueling Cost Reduction to enable Commercialisation (Reference) LOW CO 2 HYDROGEN PRODUCTION: Multiple Viable Options Clean  Carbon Capture Ref.: Shell WHTC 2009 Paper

8. Copyright of Shell Alternative EnergiesMay 5, 2010 8 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

9. Copyright of Shell Alternative EnergiesMay 5, 2010 9 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

10. Copyright of Shell Alternative EnergiesMay 5, 2010 10 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 (50-100 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 2010 1 station 2012 5 stations 2020 100-500 stations ? Gasoline ($/kg eq )

11. Copyright of Shell Alternative EnergiesMay 5, 2010 11 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)

12. Copyright of Shell Alternative EnergiesMay 5, 2010 12 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 presentation @ NHA 2010)  700 Bar v/s 350 Bar - 30% reduction in potential costs STATION SIMPLIFICATION: Opportunities for Cost Reduction 100 kg/day station

13. Copyright of Shell Alternative EnergiesMay 5, 2010 13 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

14. Copyright of Shell Alternative EnergiesMay 5, 2010 14 Hydrogen Refueling Cost Reduction to enable Commercialisation Contact Info Nikunj Gupta Technology Advisor – Hydrogen Nikunj.gupta@shell.com 713-241-1371

16. Copyright of Shell Alternative EnergiesMay 5, 2010 16 Hydrogen Refueling Cost Reduction to enable Commercialisation APPENDIX A: Refueling Cost Roadmap (LH 2 Based Station) Gen I: prototype stations (50-100 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 2010 1 station 2012 5 stations 2020 100-500 stations ? Gasoline ($/kg eq )

17. Copyright of Shell Alternative EnergiesMay 5, 2010 17 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

18. Copyright of Shell Alternative EnergiesMay 5, 2010 18 Hydrogen Refueling Cost Reduction to enable Commercialisation APPENDIX C: CAPEX Estimate Basis