Hydrogen Finds a Seat at Alternative Energy Table

Faster refueling time gives hydrogen boost over EV, experts say
Hydrogen pump at Shell
Photograph: Shutterstock

Convenience stores and fuel stations planning for a transition to cleaner energy shouldn’t focus exclusively on electric-vehicle charging, experts say.

Hydrogen also is a viable alternative to fossil fuels, especially for fuel stations with trucks as customers.

“There’s going to be a seat at the table for all of these technologies. I think those who feel there’s going to be a winner-take-all are a little bit shortsighted,” said Scott Negley, senior director of product management, North American products at Dover Fueling Solutions.

“Hydrogen is likely to be a winner, just based on refueling time,” Negley said.

One difference is the amount of time it takes to recharge an electric heavy truck that doesn’t have a hydrogen fuel cell compared to one involving hydrogen or diesel fuel.

With diesel-fueled truckers today accustomed to refueling in minutes, not hours, interest in the faster clean energy of hydrogen is growing and the number of alternative fuels is expanding.

A hydrogen-powered truck can refuel in about the same time it would to fill up with diesel, said Jonathan Eichberger, executive director of the Transportation Energy Institute, formerly called the Fuels Institute.

Eichberger said hydrogen is being overlooked while the media focuses on electric vehicles. The Biden administration has contributed to the news with announcements about goals of a nationwide EV network and net-zero emissions. In May, U.S. Transportation Secretary Pete Buttigieg and Canadian Minister of Transport Omar Alghabra announced a U.S.-Canadian alternative fuel corridor with EV charging stations positioned about every 50 miles from Quebec City to Kalamazoo, Michigan. The two countries also have agreed to use common standards for charging ports.

“They love the electric vehicle story,” he said. “Because the media is hyping electric vehicle so much, there’s this assumption they are ubiquitous. We’re very far from that,” he said.

The Biden administration has announced  goals of a nationwide network of 500,000 chargers installed by 2030 and to help cut fuel emissions 50%. He also would like EVs to represent half of all new vehicle sales in the U.S. by 2030.

Government officials also have contributed to media coverage with announcements like the U.S. -Canada Binational Electric Vehicle Corridor, with EV charging stations positioned about every 50 miles from Quebec City to Kalamazoo, Michigan. The two countries also have agreed to use common standards for charging ports.

The Bipartisan Infrastructure Law and the Inflation Reduction Act provide public dollars to help achieve the goals. Private companies have stepped up with new investments in EV charging and related technologies. Volta Inc., which was acquired by Shell this year, offers a data analysis platform designed to help local governments decide where to install EV chargers.

Government incentives exist for hydrogen, too, but haven’t received the same amount of media coverage, Negley said. “What’s lost on some folks,” he said, is “there literally is more infrastructure funding for the high-pressure hydrogen than there is for EV in terms of incentives for retailers to go out and build infrastructure.”

The Inflation Reduction Act added $2 billion in new federal grants that can be used for hydrogen fuel-cell EVs, business tax credits of 6% up to $100,000 for qualified alternative fuel vehicle refueling properties and other tax credits reducing clean hydrogen production costs to about $3 per kg hydrogen and other funding to funds outlined in the Bipartisan Infrastructure Law, such as $8 billion for regional clean hydrogen hubs, $1 billion for a clean hydrogen electrolysis program, $500 million for clean hydrogen manufacturing recycling research, development and demonstration program. A portion of federal grant funds allocated to states for a charging and fueling infrastructure also can be used for hydrogen, according to a White House fact sheet on the Bipartisan Infrastructure Law.

The original equipment manufacturers play a large role in determining the vehicles made available, and several car and truck manufacturers are investing in hydrogen, Eichberger said. “Toyota, Cummins, Shell—all of them are very interested in hydrogen,” he said. Kenworth is using Toyota’s hydrogen fuel-cell technology into its T680 fuel-cell EV on-highway truck, extending the range to up to 450 miles. The truck stores its energy as compressed hydrogen gas, Kenworth said on its website.

Manufacturers also are interested in using hydrogen in combustible engines because the fuel doesn’t emit carbon dioxide.

The growing interest in alternative fuels is causing suppliers like Dover Fueling Solutions to shift gears from a fossil-fuel focus.  “We recognize the impact, and we’ve structured our business accordingly,” Negley said. “We’re collaborating with our global teams to develop a hydrogen dispensing platform that will be fit for a variety of areas, including North American market,” Negley said.

California is leading the way in hydrogen adoption, he said.  With the first phase of the California Air Resources Board’s (CARB) 2008 emissions regulations taking effect this year, California requires trucks over 14,000 pounds with a pre-2010 engine to replace the engine with a new one to reduce particulate matter and nitrogen oxide, according to the CARB.

The next phase requires new trucks operating near railways and ports in California to be zero-emission by 2024. It also bans all diesel truck and bus fleets from California roads by 2045.

The new regulations are providing a reason for vehicle manufacturers and fuel stations to look for alternative energies, including hydrogen, EV, ethanol and renewable diesel, Negley said. “I believe they will have a significant impact on our transportation infrastructure going forward. We’ll be better suited if we can find a space at the table for all of them.”

Despite the faster refueling hydrogen offers, the alternative energy faces an uphill battle from the cost of the necessary infrastructure. “It’s not a trivial expense to build a hydrogen station,” he said, estimating the cost of construction at $1.5 million to $5 million.

“You need to make sure as a business, you have that critical mass of vehicles to help you make a return on the investment. Even after a lot of the incentives are made, we don’t have that critical mass of vehicles to make the investment make sense,” Negley said.

For any of the new alternative energies fuel retailers have to question how they’ll make a return on the investment like they have for decades with petroleum fuels. “It’s a very efficient business model. It’s established. They know what their margins are per gallon.”

Traditional petroleum-fuel stations also have to make investments as wear and tear affects underground storage tanks, raising compliance issues with environmental regulations. Some leaks aren’t due to problems with equipment, but thieves who steal gasoline, he said.

Other tanks are hitting the ceiling on their insurable lifespans of about 25 to 30 years, Negley said. As tanks get older, they require more careful monitoring.

Dover Fueling Solutions, which has served the underground storage tank market with gauges and other equipment, is expanding to provide other solutions to fuel stations as the transportation energy industry broaden, Negley said.

 “We’re at 130 years of understanding liquid fuels. We’re in the first five years of other technologies. There’s a learning curve,” he said. “We think we have a place to play, albeit it’s still a very early stage with an industry that’s trying to find itself and where it fits and how it can makes sense in terms of the overall space and build the infrastructure. We’re very excited by the opportunity.”

Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.


Exclusive Content

Snacks & Candy

Convenience-Store Shoppers Are Sweet on Private-Label Candy

How 7-Eleven, Love’s are jumping on confection trends


How to Make the C-Store the Hero for Retail Media Success

Here’s what motivates consumers when it comes to in-store and digital advertising

Mergers & Acquisitions

Soft Landing Now, But If Anyone Is Happy, Please Stand Up to Be Seen

Addressing the economic elephants in the room and their impact on M&A


More from our partners