Case studies in hydrogen infrastructure

By Lisa Jerram, Pike Research Senior Analyst

Lisa Jerram, Senior Analyst, Pike Research

Two hydrogen infrastructure projects in Hawaii and Japan are showing how gas utilities can become players in the hydrogen vehicle fueling market.  In both cases, gas energy companies are partnering with automakers to develop hydrogen infrastructure that can support commercial deployment of fuel cell cars by 2015.

Hawaii Hydrogen Initiative

In Hawaii, The Gas Company is the key infrastructure partner in an initiative to build a hydrogen fueling network on Oahu by 2015.  Under the Hawaii Hydrogen Initiative, General Motors will bring some of its fuel cell cars to Hawaii, initially for use on military bases.  For The Gas Company (TGC), this effort is an opportunity to use excess hydrogen from its synthetic natural gas production processes and potentially create a new revenue stream. 

The hydrogen program also contributes to the state's aggressive renewable energy goal.  By 2030, the state wants at least 70 percent of its energy portfolio to be "clean energy."  The reason for this is fairly straightforward.  Fully 90 percent of Hawaii's power -- for electricity, heat, and vehicles -- is based on imported oil.  In order to reach its energy independence goals, the state has to look not only at electricity usage but also the transportation sector - and that is a tricky sector to shift away from petroleum. 

Hawaii is considering a blend of options, including promoting electric and hybrid vehicle sales, encouraging mass transit use, and preparing for fuel cell cars.  The Hawaii Hydrogen Initiative is looking at building a network of 20 to 25 hydrogen stations that could essentially provide service for much of the residents of Oahu, Hawaii's most populous island.  If the partnership is successful in building out this network, it would position Hawaii as an early market for fuel cell cars, which major automakers like Daimler, Honda, GM and Hyundai have said will be introduced commercially by 2015.  For this target to be met, the automakers need enough hydrogen fueling to make the vehicles viable for drivers.

Utilizing Hydrogen from Gas Production

The Gas Company's schematic for hydrogen delivery by pipeline. View the full-size image.

A major benefit of this project is the potential to employ The Gas Company's existing infrastructure.  For its main business, TGC manufactures synthetic natural gas (SNG) from naphtha, a byproduct of the oil refining that occurs on the island.  In addition to SNG, the process produces hydrogen, which is then delivered in TGC's utility stream at a level of around 5 percent hydrogen to 95 percent SNG.  TGC has roughly 1,000 miles of pipeline across the islands. 

Pipelines are ideal for cost-effective delivery of large quantities of hydrogen fuel without the footprint of massive storage capacity at the station.  Unfortunately, in many places existing hydrogen pipelines are not necessarily located where there would be a need for fuel cell car filling stations.  But on Oahu, The Gas Company's pipelines neatly track the island's major population centers.

TGC is exploring how to tap into this pipeline to divert the gas stream to the fueling stations.  The company would deploy a hydrogen separator technology that the company expects will be a cheaper option than some other hydrogen station technologies.  The company already has capacity to provide 7,000 kg of hydrogen per day.  This is more than enough for potential fuel cell car demand in Hawaii. 

Pike Research estimates that 7,000 kg of hydrogen per day could fuel a total fleet of around 13,500 cars. 

Pipeline delivery will control the quantity of hydrogen coming into a station, as right-sizing the stations is critical to keeping the down the cost of the hydrogen.  The cost of the hydrogen has yet to be determined, although TGC says it could be competitive with Hawaii's high gas prices.  If successful, this project will not only to offer reasonably priced hydrogen, but may present a new revenue opportunity for a gas company with excess hydrogen production capacity.

Japan's hydrogen infrastructure

In Japan, the country's top gas suppliers are part of a partnership with oil companies and automakers to create a hydrogen fueling network that can support the commercial introduction of fuel cell cars.  For Japan, this effort is part of a long-term, well-funded government-industry fuel cell commercialization roadmap.  Ten gas suppliers and oil companies, along with Nissan, Toyota, and Honda, have said they will build 100 hydrogen stations to prepare for the commercial launch of FCVs in 2015. These same gas companies are also participants in Japan's residential fuel cell program, Ene-Farm, which has seen upward of 10,000 fuel cell units installed in Japanese homes. 

Unlike the Hawaii effort, the project partners in Japan do not have excess hydrogen to tap into.  Instead, hydrogen in Japan has typically been reformed from products such as city gas and kerosene.  The hydrogen stations built to date in Japan have been costly - around $2 million per station.  The new hydrogen infrastructure effort aims to bring those costs down dramatically. 

Japan benefits from the same relatively limited geographic distribution of its population that Hawaii does.  The plan is to focus on building around 100 stations in four areas: Tokyo, Aichi, Osaka and Fukuoka.  The program details have yet to be fleshed out, but it seems that Japan will continue on the path of reforming products like city gas and kerosene.  This is another ambitious collaboration among auto OEMs and gas to ensure hydrogen stations are in place when FCVs become commercial, while potentially providing a new market for the gas companies.

About the Author
Lisa Jerram is a senior analyst contributing to Pike Research's clean transportation and clean industry practices with a focus on fuel cells and emerging transportation technologies. Jerram has more than 15 years of experience in the alternative energy market, including an extensive background analyzing policy and regulatory issues, demand drivers, and technology factors for industry and government clients.