Slide1: Canada’s Hydrogen and Fuel Cell Industry: Progress and Activities Chris Curtis Fuel Cells Canada August 25, 2005


Presentation Overview: Presentation Overview Setting the Scene Canadian Energy Supply Drivers for Commercialization of Hydrogen and Fuel Cells The Canadian Industry Industry Overview Government Support Major Projects The Future Challenges Meeting the Challenges


Fuel Cells Canada: Fuel Cells Canada National not-for-profit industry association Founded in October 2001 Our Mission is to promote the development and commercialization of Canadian hydrogen and fuel cell technologies, products and services Prime source of services and support to companies, educational institutions and business alliances promoting, developing and demonstrating fuel cell and related products and services in Canada 67 member companies and organizations across Canada


A Major Player in International Energy Markets: A Major Player in International Energy Markets Canada is a major producer and exporter of key energy commodities Vast energy resources support Canada’s long-term energy importance Geographic size and resource diversity create regional trading patterns West primarily exports energy; East imports energy from around the world Electricity is exported and imported in each region, depending on daily and seasonal conditions


Global Electricity Use: Global Electricity Use From the report "Global Energy Futures and Human Development: A Framework for Analysis", Lawrence Livermore National Laboratory


Drivers for Commercialization: Drivers for Commercialization Climate change Efficient and reliable power Health and environment Energy security and independence Demand for distributed power Economic Development


Climate Change Concerns: Climate Change Concerns


Global Market Projections: Global Market Projections Data from “Fuel Cell Industry Competitive Analysis - Assessment of Major Players, Global Markets, and Technologies” 2003 Allied Business Intelligence Inc., Courtesy Industry Canada Mobile Fuel Cells - $7.5 billion Stationary Fuel Cells - $7.5 billion Automotive Fuel Cells - $3.6 billion


Markets for Fuel Cell Products: Markets for Fuel Cell Products 10 100 1,000 10,000 2004 2015 Capital cost $/kW Lift trucks, industrial equipment, residential applications, off-grid and back-up power, military applications Early niche markets Distributed power Major market increases Autos Buses 700 60 Micro-applications (laptop computers, digital cameras, cell phones) Remote sites (off-grid) Source: adapted from Methanex, September 2002 Increasing: manpower + capital + production + capacity


Supply Chain Opportunities: Supply Chain Opportunities


The Canadian Hydrogen and Fuel Cell Sector: Overview: The Canadian Hydrogen and Fuel Cell Sector: Overview Activities began in 1982 with first contract for Ballard Power Systems Total Canadian industry revenue has grown 40% from $134 million in 2002 to $188 million in 2003 Industry R&D expenditures over $290 million – since 2000 an average of $100.000 per employee per year Over 80 companies across Canada are focused on fuel cell and hydrogen technology and associated services, employing over 2,600 people Patent holdings were up 34% to 581 in 2003.


The Hydrogen and Fuel Cell Industry in Canada:Global Leadership: Canada is a world leader in hydrogen and fuel cell research and development and early stage commercialization Canadian companies provide parts, systems and services to the industry, while others focus on developing the fuel cell infrastructure Canadian companies participate in 262 demonstration projects around the world Over 50% of fuel cell vehicles from auto manufacturers worldwide use Canadian fuel cell technologies The Hydrogen and Fuel Cell Industry in Canada: Global Leadership


Leadership Across the Country: Leadership Across the Country


Canada – Leadership Across the Supply Chain: Canada – Leadership Across the Supply Chain Setting the Scene | The Canadian Industry | The Future


Canadian Government Support: Canadian Government Support Federal Government Federal Government support of over $200 million between 1982 – 2002 Additional commitment of $215 million ($172 million US) from 2003-2008 Ongoing partnership with industry on R&D, demonstrations and deployments Provincial Governments Ontario Fuel Cell Innovation Program - $9 million over 3 years British Columbia - $2 million to “jumpstart” the BC Strategy Alberta – $500,000 for high temperature fuel cell initiative PEI - $2.9 million investment in wind-hydrogen project


Vancouver Fuel Cell Vehicle Program: Vancouver Fuel Cell Vehicle Program Partnership between Government and Industry Demonstration of sustainable, zero-emission based transportation technologies 5 Ford Focus vehicles to be evaluated for three years in Vancouver’s Lower Mainland Technology: Ballard Fuel Cell Systems, Dynetek Hydrogen storage Opportunity to test, demonstrate, deploy and evaluate proprietary systems for H2 production


Hydrogen Highway: Hydrogen Highway Province of British Columbia – Lower Mainland and Vancouver Island Coordinated market demonstration program designed to accelerate commercialization Framed around the 2010 Winter Olympic and Paralympic Games Showcase and demonstrate the environmental, economic and social benefits of this technology to the world First phase by 2007 is focused on seven highly visible locations Mobile, stationary and micro fuel cell applications and infrastructure Multi-agency effort


Hydrogen Highway: Hydrogen Highway Examples of Activities: Hydrogen Fueling Stations: Surrey (10,000 psi) Vancouver (5,000 psi) Victoria (5,000 psi) Hydrogen Technology Environmental Chamber Photovoltaic panels, electrolyser and hydrogen storage at the NRC Institute for Fuel Cell Innovation Integration with Vancouver Fuel Cell Vehicle Program


Hydrogen Village: Hydrogen Village The Hydrogen Village is located in the Greater Toronto Area in the Province of Ontario. The intent of the H2V is to: Create a plan and platform for the deployment of hydrogen and fuel cell technologies to the benefit of the local community. Develop the necessary supply, service, and knowledge infrastructure needed to create a sustainable market. Ensure technology deployments (stationary, mobile and transportation) fit within the context of existing community infrastructure and activity. Aid in the complementary growth of other centers across Southern Ontario – thereby developing a hydrogen Corridor.


Hydrogen Village: Hydrogen Village Examples of Activities: Hydrogen powered delivery trucks for Purolator courier fleet Fueling infrastructure and hydrogen powered forklifts for General Motors plant in Oshawa Residential heating and power generation using four solid oxide fuel cells at a townhouse-style student residence at the University of Toronto at Mississauga Back-up power for computer network servers Fuel cell-based back-up power system at a telecommunications switching station Hydrogen fuel cell powered utility vehicles in conjunction with hydrogen production and refueling at the Canadian National Exhibition


Commercialization Challenges for Hydrogen and Fuel Cells: Commercialization Challenges for Hydrogen and Fuel Cells Micro-level: Improved fuel cell reliability and durability Reduced cost Macro-level: Stimulating early market demand Improving product quality while reducing costs Financing for R&D, commercialization Creating supporting infrastructure Codes and standards


Addressing the Challenges: Addressing the Challenges The price of hydrogen and fuel cells are currently higher than conventional technologies. Products will become more competitive as: Technologies advance Economies of scale increase Externalities are included in pricing Availability of resources change


Meeting the Challenges: The Commercialization Roadmap: Meeting the Challenges: The Commercialization Roadmap Challenges, common to the industry as a whole, have been identified: Stimulating Early Market Demand Creating more market awareness Gaining more knowledge of industry Improving Product Quality While Reducing Costs Continuing to improve product quality Continuing to reduce cost Developing coordinated supply chain Financing Gaining access to capital Creating Supporting Infrastructures Obtaining skilled resources Developing fueling infrastructure Developing codes and standards


Technology Development: On Track for Commercialization: Technology Development: On Track for Commercialization Canadian companies are meeting technology development timelines Ballard Power Systems has reduced costs of fuel cells by 80% since 1999, while achieving a ten-fold increase in lifetime In 2004 the cost (adjusted for high volume production) was down to $103 per kW. Target for 2010 is $30. Fuel Cell Technologies has accumulated over 1500 hours of operation on its second generation 5 kW system Hydrogenics HyPM 10 kW power module has achieved over 5000 hours of operation & over 6500 “stop-start” cycles on a single unit Dynetek Industries has 10,000 psi (750 bar) hydrogen tanks on the market BC Hydro/Powertech is a 10,000 psi operational fueling station


Partnership with Government: Retaining Leadership: Partnership with Government: Retaining Leadership Continued leadership requires a National Strategy: R & D Universities / Institutions Private Sector Demonstrations Applications & Fueling infrastructure Government Procurement Tax credits for end users Improved access to capital through Enhanced private sector funding Government commercialization fund Improved delivery and effectiveness of government programs. Currently 29 programs delivered through 13 federal agencies.


Fuel Cells Canada Sponsoring Members: Fuel Cells Canada Sponsoring Members


Fuel Cells Canada Members: Fuel Cells Canada Members Advanced Measurements Inc. Alberta Research Council Alternate Energy Corporation Angstrom Power Inc. Astris Energi Inc. Azure Dynamics Corp. Ballard Power Systems Inc. BC Hydro BC Transit BOC Gases Business Development Bank of Canada Canadian Hydrogen Association Canadian Hydrogen Energy Corporation Cellex Power Products Inc. ChevronTexaco Technology Ventures Chrysalix Energy Limited Partnership Clean Energy Canada Conduit Ventures Ltd. Deloitte & Touch LLP Dynetek Industries Ltd. Enbridge Gas Distribution Energix Research Energy QBD Inc. Ford Motor Company FTI International Inc. Fuel Cell Technologies Ltd. FuelCon Systems Inc. General Hydrogen Corporation Gowling Lafleur Henderson LLP Greater Vancouver Regional District GrowthWorks Ltd Heliocentris Energy Systems Inc. HERA, Hydrogen Storage Systems Inc. HSBC Bank of Canada H3 Energy Hydrogenics Corporation IESVic Inco Special Products Keen Engineering Kinectrics Inc. KPMG LLP Marcon-DDM Marsh Canada Ltd. McCarthy Tetrault LLP Membrane Reactor Technologies Ltd. Methanex Corporation National Bank Financial National Research Council NORAM Engineering and Constructors Ltd. Palcan Power Systems Inc. Pathway Design & Manufacturing Inc. PEM Engineers Inc. PricewaterhouseCoopers LLP Propane Gas Association of Canada Inc. Province of Ontario Quebec’s Fuel Cells and Hydrogen Network Queen’s RMC Fuel Cell Research Centre QuestAir Technologies Inc. Sacré-Davey Engineering Sarnia-Lambton Economic Partnership TD Securities Inc. Tekion Solutions Inc. Teleflex Canada Inc. University College of the Fraser Valley Westport Innovations Inc. Zongshen PEM Power Systems


Slide28: Thank you Chris Curtis Fuel Cells Canada August 25, 2005