Paul Rodden • Season: 2024 • Episode: 277
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Welcome to The Hydrogen Podcast!
In episode 277, Mexico takes over hydrogen generation at Tula. Honda and Mitsubishi team up and Ballard gets a big long term supply agreement with NFI. I’ll go over all of this news and give my thoughts on today’s hydrogen podcast.
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Transcript:
Mexico takes over hydrogen generation at Tula. Honda and Mitsubishi team up and Ballard gets a big long term supply agreement with NFI. I’ll go over all of this news and give my thoughts on today’s hydrogen podcast.
So the big questions in the energy industry today are, how is hydrogen the primary driving force behind the evolution of energy? Where’s capital being deployed for hydrogen projects globally? And where are the best investment opportunities for early adopters who recognize the importance of hydrogen? I will address the critical issues and give you the information you need to deploy a cap. Those are the questions that will unlock the potential of hydrogen and this podcast will give you the answers. My name is Paul Rodden, and welcome to the hydrogen podcast.
In an article in marketwatch.com, Karla Omaña writes, Mexico orders Pemex to seize Air Liquide hydrogen plant at Tula refinery, the Mexican government on Friday ordered Pemex to take over Air Liquide Hydrogen plant at the state owned oil companies to the refinery in Hidalgo state, as part of its push to become self sufficient in fuel production. President Andres Manuel Lopez Obrador, ordered Pemex is refining subsidiary try to take control of the facility, calling a hydrogen supply for the refinery a matter of public interest.
The Government published the decree on Tuesday, in a quote from the government to achieve the federal government’s objective of reaching energy sovereignty through self sufficiency in the production of refined products. It’s necessary to have autonomy and hydrogen supply at the Tula refinery without depending on external parties under former President Enrique Pena Nieto’s administration, Pemex signed a nearly $53 million deal with French firm Air Liquide. To supply hydrogen to the Tula refinery, Mexico depends on third parties for hydrogen supply, something that government said was putting domestic gasoline and diesel production at risk.
The government also said its deal with Air Liquide was not economically viable for Pemex. According to the decree, Pemex will compensate Air Liquide for the hydrogen plant based on an appraisal from the Institute of administration and appraisal of national assets. PEMEX CEO Octavio Romero said in 2021, that Lopez Obrador had ordered the company to open negotiations to buy back hydrogen plants at the companies Tula, Madero and Cadereyta refineries that were sold during previous administrations. Romero said the Lopez Obrador administration managed to cancel the sale of Cadereyta but Pemex continue to pay a lot to lease back the facilities. PEMEX did not immediately respond to requests for comments to Opus. An Air Liquide spokesperson on Tuesday said the company’s legal team is analyzing the impacts of the decree and stressed that the action is not an expropriation.
The Mexican government last year attempted to take control of a privately owned railway line in southern Mexico operated by Grupo Mexico but later reached an agreement with the company. Okay, so some heavy news coming from Mexico as the state’s energy company, Pemex is ordered to take temporary control over the hydrogen production at the Tula refinery. Now I spoken on occasion about Mexico’s ambition for developing a hydrogen economy. And this move certainly plays into that. But this can be a risky move and could give large outside players second thoughts about operating in Mexico.
Now Air Liquide has said this is not expropriation. But it is very close to it and coming on the heels of the attempting takeover of the Grupo Mexico southern rail system. My thoughts are this Air Liquide is very good at what they do. In this case developing and transporting hydrogen. I’m unclear on the qualifications that Pemex has with hydrogen generation and transportation. Maybe they’re just as qualified as Air Liquide. But that is a very big risk to take on. And that’s why I’m a big proponent of letting the experts do what they do best. And in this case, that would be letting Air Liquide continue as the hydrogen supplier. Next in an article in datacenter dynamics.com Peter judge writes Honda and Mitsubishi to test data center powered by waste hydrogen using recycled auto fuel cells.
Honda and Mitsubishi are planning to test a small data center that runs on hydrogen from an industrial electrolysis plant run by Tokuyama Corporation. The hydrogen is a byproduct of the Tsukiyama plant, which makes sodium hypochlorite and chlorine by electrolyzing saltwater. Honda will use it to fuel a power plant built from fuel cells retired from electric vehicles and Mitsubishi will use the electricity to power a data center. Mitsubishi has announcement doesn’t say how big the data center will be, but shows an image of a shipping container size facility.
Tokuyama has run the electrolysis plant in Shunan City, Yamaguchi Prefecture, since 1952, upgrading it over the years to the diaphragm and then the ion exchange membrane process and makes around 50,000 tons of sodium hypochlorite per year along with chlorine. Hydrogen is also made as a byproduct and tokuyama will provide this via a pipeline, Honda will build a fuel cell power station which will reuse fuel cells that have been retired having been used in electric vehicles. Japan is one of the few countries with a significant fleet of fuel cell EVs and therefore a potential supply of reused fuel cells. Korea has nearly 30,000 on the roads while Japan has some 7700 and the US has around 15,000.
Honda has already tested retired hydrogen fuel cells, and its US headquarters in Torrance, California, where they’re used for datacenter backup, the joint demonstration project will be backed by Japan’s new energy and industrial technology development organization, or Nedo. As a trial to move to a hydrogen society. The project aims to test the reusing of automotive fuel cells and a stationary application in the hopes of making fuel cell power plants for stationary applications cheaper. The project partners hope to show some data centers can be decarbonized by using byproduct hydrogen, and Second Life fuel cells. And will investigate whether production data centers in the area could be powered in this way, the project will run until the fiscal year ending March 3120 26.
Okay, so a very interesting collaboration in Japan that could have some meaningful impact down the road for hydrogen and used fuel cells. Now the hydrogen discussed in this process is a historically waste product from saltwater electrolysis. But now with the hydrogen economy developing we’re witnessing hydrogen that was traditionally wasted, become utilized for the energy carrying properties. It’s always had think monolith and their methane pyrolysis plant, same situation. But now there is a specific use case for the hydrogen, and two juggernauts and fuel cell development and electricity generation are teaming up to test the hypothesis. Honda has been making FC EVs for decades, and Mitsubishi is quickly becoming the go to source for hydrogen fueled electricity generation. And I’m excited to see the results from this endeavor in a couple of years.
And lastly, in a press release on January 3, Ballard announces new long term supply agreement with NFI and purchase order for 100 Fuel Cell engines for bus deployments in North America. Ballard Power Systems announced the signing of a new long term supply agreement with NFI group, a leading independent bussing coach manufacturer and a leader in electric mass mobility solutions in North America and Europe. The agreement marks a new phase in the established partnership between Ballard and NFI focused on deployment level volumes of fuel cell powered buses across all of NFI major brands, including New Flyer, Alexander Dennis, and MCI. As part of the LTSA, NFI has placed its first purchase order under the agreement for a minimum of 100 FCmove®-HD+ modules for planned delivery in 2024. The modules will primarily be produced in Ballard’s Bend, Oregon facility with Buy America compliance, and will power New Flyer’s next generation Xcelsior CHARGE FC™ hydrogen fuel cell buses for deployment across the US and Canada, including California, Manitoba, Nevada, New York, Ohio, and Pennsylvania.
Okay, so a big win from Ballard in this order from NFI. Now the 100 fuel cell engines are a big win. But to me, the key to this announcement is the long term supply agreement. This is what investors and developers are looking for when deciding on capital allocation. Along with that positive note are the areas for deployment. We know California has a small hydrogen system in place. But the other areas for distribution are quite intriguing. Now, Nevada, it’s a bit of an anomaly. But New York, Ohio and Pennsylvania are all included in the hydrogen hub funding from the IRA. And I’m curious if this announcement hinged on those areas being selected so that these buses would have a fuel supply.
Either way, this is a huge win for Ballard. All right. That’s it for me, everyone. If you have a second, I would really appreciate it. If you could leave a good review on whatever platform it is that you listen to Apple podcast, Spotify, Google, YouTube, whatever it is, that would be a tremendous help to the show. And as always, if you ever have any feedback, you’re welcome to email me directly at info@thehydrogenpodcast.com. So until next time, keep your eyes up and honor one another.
Hey, this is Paul. I hope you liked this podcast. If you did and want to hear more. I’d appreciate it if you would either subscribe to this channel on YouTube or connect with your favorite platform through my website at www.thehydrogenpodcast.com Thanks for listening. I very much appreciate it. Have a great day.
