JAPAN-NORWAY HYDROGEN SEMINAR Collaboration within hydrogen future market and value chain Venue: Norwegian Embassy in Tokyo Date: February 28, 2017 Brief introduction of Hexagon Composites International collaboration on development of regulation, codes and standards for storage of high pressure compressed hydrogen Per S. Heggem Director, RCS and Hydrogen Products Hexagon Composites 1
HEXAGON COMPOSITES GROUP High growth technology company manufacturing composite pressure tanks and assembling systems for storage of LPG, natural gas and hydrogen Headquartered in Aalesund, Norway facilities in Germany, Norway, USA, Canada and Brazil sales offices in India, Singapore and Russia 776 employees of which 412 employees in Agility Fuel Solutions (50% JV) Listed on Oslo Stock Exchange (OSE:HEX) market cap of approx. EUR 520 million 4
HEXAGON BUSINESS AREAS LOW-PRESSURE LPG HIGH-PRESSURE CNG & H2 AGILITY FUEL SOLUTIONS (50%) LPG CYLINDERS MOBILE PIPELINE HYDROGEN PRODUCTS LIGHT-DUTY VEHICLES HEAVY-DUTY VEHICLES 3
KEY STRATEGIC DEVELOPMENTS IN 2016 Mitsui & Co. made an investment in Hexagon Composites and became the largest shareholder (25%). Similtanously a strategic alliance was announced Agility Fuel Systems and Hexagon Composites CNG Automotive Products Division merged to create Agility Fuel Solutions (50% owned) Hexagon Composites acquired xperion Energy & Environment and strengthened its position in the composite pressure cylinder market 4
EXPANDING OUR GEOGRAPHICAL FOOTPRINT The extended Hexagon Composites Group totalling 776 employees Arnheim, Netherlands Sales representative Paris, France Sales representative Aalesund, Norway Headquarters Raufoss, Norway Low-pressure cylinders High-pressure cylinders Raufoss, Norway Agility Fuel Solutions Kelowna, BC, Canada Agility Fuel Solutions Lincoln, Nebraska High-pressure cylinders Lincoln, Nebraska Agility Fuel Solutions Santa Ana, CA Fontana, CA Agility Fuel Solutions Heath, Ohio High-pressure cylinders Taneytown, Maryland MasterWorks Nashville, TN Agility Fuel Solutions Salisbury, NC Agility Fuel Solutions Anniston, AL Agility Fuel Solutions Kassel, Germany High-pressure cylinders Nizhny Novgorod, Russia Sales office Copenhagen, Denmark Sales representative Klagenfurt, Austria Sales representative Barcelona, Spain Sales representative Bangalore, India Sales office Singapore Sales office Sao Paolo, Brazil Agility Fuel Solutions Hexagon Group administration and production sites Sales offices and representatives Agility Fuel Solutions (50% JV) 5
ABOUT MITSUI & CO. LTD (As of March 31, 2016) Number of Offices and Overseas Trading Subsidiaries 138 (As of Feb 1, 2017) Global Network 65 Number of Employees (consolidated) 43,611 Number of Subsidiaries and Equity Accounted Investees countries/regions (As of Feb 1, 2017) 462 6
MITSUI & CO AND HEXAGON COMPOSITES Alliance secures a valuable and long-term minded partners Directly leverage the Hydrogen opportunity Global footprint, geographic reach and leverage Hexagon Composites, Mitsui & Co., and Toray Industries commenced a business viability study of a proposed JV to manufacture and sell highpressure cylinders for hydrogen vehicles in Japan Mitsui & Co investment Details in Hexagon Composites: 25% ownership Strategic alliance agreement Covers all Business Units 7
Weight STEEL TO COMPOSITE THE EVOLUTION Steel bottle trailer Steel tube trailer TITAN4 TITAN XL Volume 8
CHALLENGES RELATED TO EXISTING REGULATION CODES AND STANDARDS (RCS) Transport of compressed hydrogen CAPEX and OPEX must be reduced, which today can be achieve by Increase in pressure Use of larger cylinders in combination with smaller cylinders to utilize space available (weight is a limiting parameter for metal based cylinders) More adequate safety margins Doing this under the argumentation that hydrogen is the driver, is a challenge by it self (some would say three impossibilities in one when combined with hydrogen), but they can all be controlled in an acceptable way, leading to safe(r) products. Restrictions on pressure and volumes varies. Some examples Japan: max 360L and max 450 bar with a safety margin 2,25 Europe (ADR): max 3000L and no pressure limit, but safety margin 3,0 US: DOT special permit on cylinders up to 8400L (Note: 3000L was back in history determined as the largest seamless metal cylinder that could be made. Composite cylinders has opened up for unlimited size of cylinders) 9
ONGOING DEVELOPMENT RELATED TO TRANSPORT OF COMPRESSED HYDROGEN ISO 17519 is the first ISO cylinder standard that combine requirements to cylinders and frames/containers. The standard is developed under leadership of Standard Norway. Final ballot before publication estimated to take place Q3-2017 9 countries has nominated experts to the working group. Japan has listed JISC as document monitor. So far Japan has abstained from voting. Support from as many as possible ISO member states is need. Japan is very welcome to cast a positive vote, contributing to an significant improvement on RCS related to transport of compressed hydrogen. 10
HYDROGEN REFUELING STATIONS (HRS) HIGH PRESSURE STORAGE Hydrogen refueling stations require at least a part of the storage capacity to be at 950 bar or higher to be able to top fill FC-vehicles within the desired fill time of 3 minutes. Each fill will create a pressure cycle. With only a few vehicles coming in for refueling each day, number of fill cycles is not an issue, but in the near future a medium sized HRS should be able to serve at least 100 vehicles per day. Over desired lifetime of an HRS this will create 100x365x20= 730.000 pressure cycles. Mostly small amplitudes, but at a high mean stress level, creating issues for cylinders using fatigue sensitive materials. Existing RCS require cycle testing with deep cycles (all cycles go from near empty cylinder to maximum developed pressure (worst case pressures) ref USA-based ASME and Japan based TD 5202. It will take tremendous time and cost to qualify cylinders for lifetime service unless there will be a significant change in the referenced requirements. The alternative is to accept recurring cost (replacement of cylinders several times over the lifetime of the HRS). 11
ONGOING DISCUSSIONS RELATED TO HIGH PRESSURE STORAGE AT HRS Is a leak in a 950 bar cylinder an acceptable failure mode? Argument for a yes: better with a leak before a burst (LBB) Argument for a no: if a leak occurs, a huge amount of hydrogen will start leak, and it will not be possible to control the release rate (can be very high) Right answer is most likely to use a cylinder design that will not leak or burst over the lifetime of an HRS (ref example leading to 730.000 cycles) without leak or burst as failure mode. Requirements to metals exposed for high pressure hydrogen. Japan require stainless steel qualities in accordance with SUS 316 (high Ni, high Ni eqv in combination with a Ra-requirement) with significant added cost compared to materials in accordance with other standards commonly accepted in other countries. The requirements should be the same all over. Not good having too demanding requirements and not acceptable with requirements that does not make safe products. Years of research in USA, Germany and Japan has not yet come up with a clear conclusion. The next challenge will be to harmonize relevant RCS on a global basis. 12
TECHNOLOGY FOR STORAGE AT HRS IS READY - RCS ARE NOT READY Hexagon Composite introduced 95MPa - 255L cylinder for the HRS market in 2010, type approved in accordance with the European Pressure Equipment Directive (PED) for use in all European countries. Later on in Japan in accordance with the JIGA rules for use on mobile (only) HRS. In the meantime new rules is developed in Japan (TD 5202). Test requirements is un-realistic and can not be used for qualification of cylinders intended for real use when number of FCvehicles increase. Without knowing what the near time rules will require, introduction of new technology can easily stop up. 13
COMPOSITE CYLINDER FIRE PROTECTION NEW SAFETY STRATEGIES NEEDED Basic principle Determine actual remaining strength of composite material use over time in fire. Focus on trigger and pressure release system strategy, also taking into consideration what energy the surroundings can safely receive Requirements to be based on demonstration, either by calibrated simulation models or practical testing, that the combination of specific composite material and a specific trigger/pressure relief system match each other, so that the hydrogen storage will stay safe in a fire at/on the application the composite cylinder is intended to be used in. 14
REGULATION, CODES AND STANDARDS FOR HIGH PRESSURE HYDROGEN APPLICATIONS A break through/modernization of RCS is needed. Too much of the RCS for hydrogen applications is still based on carry over from other than composite materials, other gases and lower pressures than what hydrogen require. Lack of relevant Regulation, Codes and Standard is a hinder for international market development (GTR 13 and SAE is the only exemption so far). The industry needs a break through on RCS topics related to Composite Cylinders used for transport and storage of larger quantities of compressed hydrogen. International collaboration on pre-normative research and international harmonization of RCS is needed before a real global deployment of hydrogen will take place in the public domain. 15
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