Battery-powered cars remain a niche in the auto industry – less than 1% of sales – and hydrogen fuel cell options remain limited to California and other states that restrict emissions. However, in the industrial world, electrically powered vehicles make up about half the sales in one critical market, and users are rapidly adopting hydrogen as the fuel to generate that power.
Buyers of industrial lift trucks – fork lifts, container handler, warehouse equipment, and tow motors – are buying a growing number battery-powered models and fewer trucks powered by propane, natural gas, diesel, and other fuels. The balance shifted toward electric models in roughly 2009, according to statistics from the Industrial Truck Association trade group. Within the electric lift truck world, producers say about 6,000 models are powered by hydrogen fuel cells instead of lead-acid batteries. Although that only accounts for about 1.3% of sales in the past 10 years, the number of units more than doubled in 2014. Today, hydrogen fuel cell fork lifts are more common in industrial and warehouse operations than electric cars are on U.S. roads – and that market share is growing.
Late in 2014, manufacturer Hyster-Yale Materials Handling, through its subsidiary NACCO Materials Handling Group, purchased Nuvera Fuel Cells Inc., a technology company that had produced some fuel cell stacks for Hyster and Yale brand lift trucks. Company officials say having fuel cells available from OEMs, instead of forcing customers to go to aftermarket suppliers, should accelerate the already fast-growing field. Jon Taylor, CEO of Nuvera, spoke with Today’s Motor Vehicles about the state of the hydrogen lift truck market and where things are heading.
TMV: What’s the current state of the fuel cell-powered lift truck market, and why are some customers looking to fuel cells as a replacement for lead-acid batteries in their electric trucks?
JT: Sales have been growing. There have been new sales announced by fuel cell providers to some high-profile buyers, including Wal-Mart. They’re particularly present in the indoor/warehouse equipment type applications, but we’re also seeing adoption in heavy industry.
Customers can experience a lot of productivity issues with [battery-powered trucks]. A lead-acid battery lags as you move into the second half of its charge, traveling slower, lifting at a slower rate, and putting more stress on the truck electronics.
You then need to drive it to a charging station and get in line. You pull out the old battery and put in the new battery – that can take 15 minutes – then charge the old one. With hydrogen, we can fill a fuel-cell truck in 3 minutes, and you never get that voltage lag. As long as there’s fuel in the truck, you get full power.
TMV: Are there infrastructure limitations to battery-powered units?
JT: In many cases, significant, expensive indoor space is taken up by battery recharging facilities and battery management. You need to have chargers set up, storage space for the used batteries to cool down after charging, areas for the vehicles to queue up, and cranes to lift the battery out of the truck and put in the new battery. You also have people managing batteries and charging rather than being involved in production or warehousing.
When you start talking about hydrogen and fuel cells, you have a much smaller footprint inside the building, similar to the pump at a gas station. You pull up to and fill up in three minutes.
TMV: Have outdoor users or non- warehouse operators responded?
JT: With heavy industry, they’re obviously going to have the issue of energy consumption. The higher your energy consumption, the more you’re able to handle the fixed costs of delivering hydrogen to your site. So we’ve been seeing a lot of interest from heavier applications.
In the outdoor market, more customers – either because of their corporate image concerns or regulatory issues – are looking at alternative powertrains. Look at some of the ports in the zero-emissions states; they’re under pressure to eliminate or significantly reduce emissions. This is a solution we expect to offer to them in the years ahead.
When does hydrogen make sense?
Nuvera CEO Jon Taylor says hydrogen fuel cells tend to make the most sense for lift-truck operations with:
Medium-to-large sized fleets, 20-30 units or more. Small fleets struggle to save enough in energy and productivity to justify truck costs and hydrogen-generation expenses. Larger fleets can quickly benefit from space savings, productivity, and fuel costs.
Heavy-duty applications, either high weight or multi-shift, 24/7 operations. Multi-shift operations benefit by eliminating charging wait times and freeing up floor space. Operations with heavy loads benefit from consistent power output.
Productivity/cost gains needed. Low-cost, lead-acid batteries favored by manufacturers tend to take hours to charge, requiring machine downtime or floor space for charging. Many shops have extra lift trucks in service to keep operations running while other machines charge. Fuel-cell trucks, on the other hand, can be refueled in about 3 minutes.
TMV: In addition to the fuel cells, Nuvera has systems for separating hydrogen from natural gas, allowing users to generate their fuel on site from gas lines. How important is this piece of the business?
JT: One advantage of lift truck vs. car, you don’t have a geographically dispersed distribution network. It’s a fleet-fueled industry, which minimizes infrastructure costs. On-site terminals are already standard with electrically powered models, and we’re improving on those.
A single Nuvera PowerTap unit can create enough hydrogen for 30 or more lift trucks, and we can put in multiple units to support bigger fleets. These units are placed outdoors with only the dispensing pumps located indoors, reducing the amount of space to significantly less than what fleets are using now for battery storage and staging.
There are other solutions for distributing hydrogen to fleets. Some use trucked-in liquid hydrogen or gaseous hydrogen. There are cases where that makes sense. In most cases, on-site generation will be a good solution.
That’s one reason the adoption of fuel cells in the lift truck industry has been faster than in the auto industry. You don’t have to worry about siting hydrogen stations all over the country. We’re saying, “Put the station at the customer’s site, and you can produce enough hydrogen to supply that customer.” It’s a very different challenge.
TMV: Is this a technology that Nuvera could sell or license to retail gas station operators to support consumer hydrogen fueling?
JT: That’s a possibility. Our initial focus is the lift truck industry and our customers there. We have a lot of opportunities doing that, and we’ll focus on getting that business going.
TMV: In the auto industry, weight has been a big concern with fuel cell stacks. Heavy stacks lead to higher vehicle weight, which reduces range and efficiency. Is this a problem in the lift truck world?
JT: No, because in a lift truck you need counter-weight to lift heavy loads and keep the vehicle balanced. When you look at current battery powered forklifts, the battery weight is replacing some of the lead or iron counterweight that would go into a non-battery-powered vehicle.
TMV: Aftermarket companies selling fuel-cell stacks for lift trucks have been experiencing double-digit growth for nearly a decade. How will getting an original equipment manufacturer (OEM) involved impact the market?
JT: We believe that we can accelerate that growth. As an OEM, we think we’ll be able to offer a solution that’s a better fit to our product and to our customers’ needs. It will move out of niche adoption. We see it going through three phases. We’re looking at first adopters right now, who are doing it for various reasons – to keep ahead of the technology curve, meet corporate sustainability targets, and the like. Phase 2 will be the larger fleets, those looking for productivity gains. As prices fall, they are going to see quick paybacks on investment. With the heavier fleet users, we believe that within five years, we can get to where any user with more than 20 trucks will be able to seriously consider fuel cells.
Where you really move into mass adoption, Phase 3, is when you can get the cost of the fuel cells and the cost of hydrogen delivery down from where they are today, down to where – when you compare economics – fuel cells will compare very favorably, even for one- and two-shift operations. That’s still more than five years away.
TMV: What could speed up that market adoption?
JT: There’s a 30% federal tax credit for implementing fuel cells in lift trucks, and that’s due to expire at the end of next year. There’s a possibility that may be renewed or extended permanently. That’s helping get the cost down, but our objective is, bringing the expertise of NACCO Materials Handling Group – which has a strong supply chain, manufacturing capability, and a distribution channel – will help us drive volume and bend down the cost curve. We hope we can get the cost below where we are today with that 30% federal subsidy. But in the short term, the tax credit is very helpful.
The states with zero-emissions transportation mandates are also speeding things up. As the automobile manufacturers are looking to meet those regulatory requirements, fuel cells are a highly attractive option because they are consumer friendly – no range anxiety like with electric cars or hours required for recharging batteries. Automakers have begun releasing fuel-cell vehicles in the U.S. Hyundai has one already, Toyota has released its in Japan, and it will be rolling out soon in California and New England. Honda’s will be out soon as well.
We believe we can leverage the increased volume for systems and components from automakers to lower our costs and increase the performance of fuel cells for industrial trucks and equipment.
Hyster-Yale Materials Handling
Nuvera Fuel Cells Inc.
About the author: Robert Schoenberger is the editor of TMV and can be reached at firstname.lastname@example.org or 216.393.0271.