Below is the text version for the H2IQ Hour webinar "Sea Change, the First Hydrogen-Powered Passenger Ferry in the United States" held on December 12, 2024.
Kyle Hlavacek: Alright. There we go. Hello, and welcome to this month's H2IQ Hour webinar. Today we have our final presentation of the year from SWITCH Maritime, the developer and operator of the first hydrogen-powered passenger ferry in the U.S. known as Sea Change, which operates in the San Francisco Bay Area. My name is Kyle Hlavacek with the Department of Energy's Hydrogen and Fuel Cell Technologies Office supporting stakeholder engagement and other outreach activities.
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I'll now hand it over to Pete Devlin, technology manager for systems development and integration subprogram with HFTO. Pete, it's all yours.
Pete Devlin: Thank you, Kyle, and thank you to our presenters. It's indeed a pleasure to have you with us today. This is a wonderful event because the maritime administration and DOE have been working on getting hydrogen fuel cells on the water now for going on eight or nine years, and we did a number of designs. We've done some other projects together and to have SWITCH Maritime step up and actually put a hydrogen fuel cell ferry boat on the water is just a fantastic accomplishment. So, congratulations to all of you and we're very happy that you're able to have it in now in service.
With us today we have Pace Ralli, the chief executive officer for SWITCH Marine. We have Elias Van Sickle, the chief operating officer with SWITCH Marine—I'm sorry, SWITCH Maritime, and Seamus Nolan, the director of communications and government affairs with SWITCH Maritime. So welcome, gentlemen, and at this time I'd like to turn it over to Pace. Thank you.
Pace Ralli: Thank you, Pete, for the introduction and we're honored to be here and be able to present on H2IQ. I'm just getting over the flu, as you can tell my voice is just barely hanging on, so I'm going to have my team do most of the talking, but I did want to introduce the company. We started in 2018 with the idea of putting an electric ferry on the water. And then really what drew us to hydrogen was the ability to put a zero emissions electric ferry on the water with no charging infrastructure. And we followed that thread and now we have a vessel on the water and a few more projects underway, which we're excited to show you. And thank you all for attending. I'll pass it on to Elias before I completely lose my voice.
Elias Van Sickle: Thanks, Pace. Hi, my name is Elias Van Sickle. Pleasure to be on with you all. I'm COO at SWITCH Maritime and I have seen the Sea Change through from the beginning here, so excited to be presenting to you all as we round out the year. It's been a big year for SWITCH. We've gotten the vessel on the water and operating and demonstrating both to the public and industry that hydrogen fuel cells are a robust and reliable option for commercial maritime use. And with that brief intro, I'll pass it over to Seamus to kind of give us some background on our general mission before moving on to the specifics of the project.
Seamus Nolan: Thank you. Alright, so next—next slide, please.
So, to discuss first what we are working on, it's important to begin with where operators that we're working with stand. So, as with any industry that there may be, decarbonizing is quite chained, quite hard, and quite challenging, but it's inevitable. So, the operators themselves, ferry operators, whether municipal or private operators, they currently exist in a sort of comfort zone where these operators are focused on their core business that is providing safe, reliable, and effective ferry service for their passengers and for the goods and services they move.
They have many years of service, many years of experience with diesel combustion technologies, so that's a well-established operational procedures, regulations, and maintenance processes that they know quite well. And as a result of this, they find themselves at a state of business as usual where the risks that they face as an operator are quite low and easily managed. But the pending energy transition brings them to a sort of uncharted water. So, these operators face all new challenges with adapting to changing needs and pressures from both their riders and their regulators, but also from the systems and technologies that they will deploy in the future.
This means less experience with novel technologies, whether hydrogen or battery electric power, and a lack of internal knowledge on the regulations, the maintenance and operational best practices, the safety practices involved. And they find themselves in a position where the risks that they face are not well managed and the scope of those risks is quite unknown, and that's where SWITCH steps in. Next slide, please.
So, we simplify this process and de-risk the energy transition for operators through providing a model that includes not only the lease of a zero-emissions vessel, but also the wraparound services that they need to aid in decarbonization.
So, what that looks like is a number of benefits to the operator. First, it's decarbonization. The operator can realize tangible emissions reductions through the reduction in the gallons of diesel they consume as well as the carbon, nitrous—nitrogen oxide, sulfur oxide, particulate matter that they're emitting. So that's a great boon for the planet but also for the communities in which they operate. Second, it's risk management. SWITCH manages the development, construction, and regulatory risk associated with the deployment and construction of this vessel, so all the operator has to worry about is receiving this fully packaged vessel and then operating it.
As a part of this lease structure, our model ensures that operators can make a three- to five- to ten-year technology deployment decision through the lease rather than a 25-year investment decision on a technology that they don't yet understand or have the familiarity with that they need. Fourth, we handle the fueling development supply chain process so that the—all the operator has to worry about is not necessarily developing a completely nascent fuel supply chain, but rather simply when they fuel their vessel on a weekly or multi-day basis. And then finally, these vessels that we provide are of comparable specification to the diesel vessels that they are replacing. So, the similar operational and performance specifications. That ensures that they're not sacrificing anything that they're already providing in terms of service while they're decarbonizing and reducing their emissions. Next slide, please.
And what that looks like for us is leveraging our—since we are such a small team, it's leveraging our expert resources to deliver that turnkey package, and that involves working with stakeholders and partners from the design to the launch and operation process. So, on the design side, that's working with naval architects, battery and hydrogen fuel systems integrators and technology providers to ensure we are developing the most optimal and cutting-edge technology that can be deployed in a vessel.
Then it's shifting toward construction and working with the shipyard and construction managers to facilitate and manage that process. In addition to that, it's building the financing package, whether relying on project financing through conventional sources like capital, like equity and debt raising, as well as leveraging grants, incentives, and loan guarantees from the public sector to ensure that we are reducing the cost as much as possible for the operator through the lease and ensuring that this transition is as affordable as possible for them.
Then it's moving towards the commissioning stage, working with the Coast Guard and local regulators like the ports and the fire department to make sure we are handling the regulatory approval process and making sure that all the operator has to do is receive this vessel and turn it on. And then finally, it's moving toward launch and operation, working with the operator to train up their crews and their service technicians to make sure that they have all of the tools, resources, capabilities that they need to service and maintain these vessels at an optimal level without having to do the legwork of coming up with these new programs and curriculum on their own that could serve as a real barrier to adoption of these technologies.
Elias Van Sickle: Super. Thanks Seamus. So, I'll just start by framing a bit of—before jumping into the Sea Change project specifically, I'll frame a little bit of the ferry market. Back in 2018, Pace and I were living and working in Brooklyn and used the ferry in our everyday lives.
And it was partially through that experience and some of the previous heritage of SWITCH—which was in the LNG world, the liquid natural gas fuel supply chain world—we were looking to bring solutions to the maritime industry that worked the next step down the zero—down the emissions curve.
Specifically, our focus on the ferry market stems from a number of facets. So, the ferry market is generally characterized in the U.S. by an aging fleet that's a average age of 30-plus years old, which means that expected fleet renewal is accelerating. And really an overarching goal for us is to, one, be driving emissions reductions and prevent any new diesel vessels from being built. So, we really want to be there with an option and a robust offering for any operator that's ready to replace their fleet. We want to say, here's the zero-emissions vessel you can build rather than replacing another, constructing another diesel vessel that's going to be on the water for another 25 years.
Ferries are generally also strategic because they go back and forth from the same location and so that allows us to size our energy storage well, it allows us to understand how much fuel we're going to consume on a regular basis and allows us to establish a fuel supply chain that is required to fuel one of these hydrogen vessels. So, that's broadly the ferry market.
Hydrogen becomes interesting in ferries because they are relatively lower energy requirements than some other vessels and they also are a platform that allows us to prove the technology at a relatively small scale and then start to scale up as we prove in iterative steps. So, our first design here is the Sea Change. It's a 70-foot, 75-passenger ferry, it—which is comprised of three times 120-kW fuel cell racks. That's the primary power means of power production on the vessel. There's a fuel cell room that houses these fuel cell modules and that have all the inherent safety characteristics that are required to satisfy the Coast Guard and other regulatory bodies.
The hydrogen comes into us from a truck, so it's a mobile truck-to-ship fueling, which I'll talk about a little bit later. The hydrogen flows over from the trailer behind the truck to our vessel and is stored on the top deck in compressed gas form, so at 250 bar. That gas flows through the fuel cells, produces electricity out, and then that electricity is directed through our power management system to a combination of both the batteries as well as the electrical propulsion. And the batteries act in tandem with the fuel cells to provide some more of the load management of—more responsive load management. So, we've got 100 kilowatt-hours of battery onboard as well.
Broadly, one of the other differentiating factors we often are asked about, you know, are you supportive of battery electric projects only? And the strong answer is yes, we're technology agnostic, and that means that we’re supportive of every technology that enables vessel operators to move to zero emissions, and we're particularly interested in the right option for the right route. So, there are routes where battery electric only has been proven and proven well. In Norway, for instance, there's 80-plus zero-emissions battery electric vessels. Fuel cells and hydrogen, because of their increased energy density, offer the opportunity to tackle some of the longer, faster, higher-power vessels and routes and act as a complement to the existing battery-electric solutions that are out there while also alleviating the charging infrastructure that's on the shore side.
So, rounding that out, the energy density that we have in our hydrogen allows the Sea Change to transit approximately 300 nautical miles on a single fueling. That translates to about 25-plus round trips on the route that we're doing in San Francisco.
Just to briefly mention a couple of milestones along the path to completion here. COI, certificate of inspection, from the U.S. Coast Guard was a massive milestone for us. This here is the crew and some of the folks in the local Bay Area celebrating that milestone. The light at the end of the tunnel was COI, this project was a long time in the making, and COI represented the stamp of approval from the Coast Guard that certified that this was a safe vessel for us to operate in passenger service and took a lot of close collaboration with the Coast Guard to get there. So, I'll talk about that a little later as well.
Shortly after obtaining COI, the Sea Change entered public passenger service in July of 2024 in the San Francisco Bay Area. These photos here are some of the stakeholders of the project and other participants that especially—to just give some mentions. CARB, California Air Resources Board—this project was catalyzed by a CARB grant. I'll mention that in more detail briefly, but CARB was a big supporter. And then we, SWITCH, are the owner, and we leased the vessel into the San Francisco Bay Ferry fleet, which WETA, which is WETA's system here in the San Francisco Bay Area, Water Emergency Transportation Authority. The vessel is currently operating on a demonstration route from the ferry building up to Fisherman's Wharf area, Pier 41. The intention here is to use this vessel as a learning platform, both for ourselves from a technology perspective, to allow the public to come onboard and start to get comfortable with the technology, as well as transmit some of these learnings to the vessel operators.
It's—we kind of draw the analogy at times to bring a Tesla to a Chevy dealer. We are in the world of trying to make something that is novel seem like it, and over time it does become just like any other vessel that the operator would be operating. So, it's taken some time to get through the initial learnings, but really the crew has become incredibly comfortable with this vessel and is operating it on this route. The public has been very engaged, it's been fun to have folks onboard. We always mention that people onboard can drink water from the water fountain and that's where, our, we capture our exhaust. So, the fuel cells create water out the exhaust, and that is actually drinkable water.
One more milestone that happened a number of months ago as well was a celebration of the California ARCHES Hub, so thank you to DOE for putting these hydrogen hubs together, and it’s been helping propel a lot of activity in the local area. And this was an event with the Governor of California as part of the ARCHES launch onboard our vessel.
So, Seamus, this is a bit of a spaghetti chart here and it's not—the intention is not for the gory details to be digested necessarily, but this is just translating from theory that Seamus laid out in terms of SWITCH’s process to practice. What does it take to put a project like this together? And the answer is that it takes a lot. There's a lot of complexity and many stakeholders that we, SWITCH, manage in the process of getting these projects from their initial early-stage conception and design all the way through the construction and deployment. So that's where our expertise really lies.
And concretely the Sea Change was built, first started at a California yard as a stipulation of the CARB grant, we ended up moving it up to a yard called All American Marine up in Bellingham, Washington, where the substantial construction was completed. And we had to navigate COVID through this whole project. So, it took a while for us to get the boat on the water and operating in the Bay Area.
But really takes a village, couldn't have also done it without all the support of the local municipalities in California. We had a loan guarantee from California, IBank and NorCal FDC, that helped engage some traditional financing into the project. And then really commend WETA for taking an industry-leading stance on advancing zero-emissions vessels. They've got a—as an agency, a very aggressive plan to comply with the CARB commercial harbor craft regulations that have been set forth and lead the way in making the stance that they're not going to build any more zero-emissions vessels—sorry, any more diesel vessels going forward. They've got committed to building battery electric and then testing out other zero-emissions options.
To briefly mention, the first-of-a-kind project capital stack. Here we, again, have engaged a number of different financing mechanisms to get this project across the finish line. We view approximately 40% to 50% of the costs of this project as circumstantial or one-time costs. That largely just represents the fact that the way that Sea Change came together is not business as usual. Going forward as we build our next vessels, we'll be much more in the territory of business as usual, and not building at two yards, not transporting between different locations, not navigating COVID hopefully, and all manner of—all things like that.
So broadly, the capital stack is comprised of a $3 million grant, a $5 million commercial loan from Key Bank, which was supported by a 50% loan guarantee, as I mentioned, and then the rest being SWITCH equity. I'll mention one more thing, which is that the frame against which we're looking at these capital costs is the frame of a total cost of ownership model. So, we look at driving down towards TCO parity as our objective. Right now, we still exist in a world where the CapEx and partially the OpEx from the fuel supply chain side and fuel molecule costs still are at a premium, but it is our objective to offset those premiums to the greatest extent possible with incentives and grants and then be driving down and hacking away costs as part of this cost stack to present options to operators that are competitive and compliant with regulatory schemes.
Pace Ralli: Yeah, I just want to add one point Elias. Yep. Just based on the this, the last two slides. You know, it's funny from the owner's perspective, the technology was never—I mean there was technology risk, but it wasn't really concerned about the technology working, you know, just had to be sort of implemented in this new maritime application environment in which it hadn't performed before. But the technology itself wasn't really considered a huge risk to the project. Really it was the, the box at the top of the last slide, which is like the user, right? Like the end user of this asset, and that not really being, you know, that not being in place until later on in the project and trying to piece everything together and pull it through the process without an end user in place.
And so, as we think about like a lot of the costs and the time it took to get this project done, it was, you know, a lot of it was based on financing and making sure that, you know, going, taking something that's not a bankable—you know, has a long term 10–15 year lease, that would not be hard to bank or to get financed. But actually, taking something and offering it as a demonstration to San Francisco Bay Ferry, to New York City, to Seattle, to Boston, that's really where the crux of the, you know, the challenge is for us. And how we get these, this project and other projects through is really getting the end users in place and that's, you know, that's back to the—the lease is really where, is where we think that we hope that enables and facilitates the end user to get in place sooner because it's really hard to build these things without them in place.
Elias Van Sickle: Yeah, great, thanks. Just continue on here to talk a little bit about the details of the commissioning process and the collaboration with the Coast Guard. The collaboration with the Coast Guard goes far back to before the vessel was on the water, starting with a design basis agreement for a novel design. When we started this project, there was no, and still isn't, a unified set of codes and standards against which to build one of these vessels, so we advanced a regulatory matrix that established an equivalent level of safety across a number of different regulatory and set of codes and standards.
We had extensive risk assessment workshops, both HAZID and HAZOP, that helped us as a team identify the potential risks to the project, to the vessel, while it was operating and to associate and mitigate the risks inherent in the project. We then built the vessel, got it onto the water, and a lot of close collaboration with the Coast Guard too through the design process and the build process. There were some approvals that happened originally where, say, we had windows on the top deck, that we then had to take those back because that whole top deck needed to be an A60 fire boundary. So, we maintained some flexibility as we went forward and generally our strategy here with the placement of the tanks in the system design was to establish a path of least resistance. Because hydrogen rises, the tanks are placed on the top deck to have a clear path to atmosphere, and if anything happens up there, then the whole passenger cabin is safeguarded by an A60 fire boundary.
Once the vessel was on the water, we commenced our PSTPs, or periodic safety test procedures, going through every safety system on the vessel and every pump and fan and certifying that it was working according to its design and intended use. And then came the fun part, which was crew training. So, getting the whole crew familiar for the first time with what does it take to operate a hydrogen vessel? There, you know, the expectation is that you can key on and go, and it just takes some learning to get up to the curve on what does it mean to key on, what does it mean to understand the systems when everything is operating smoothly. And then when everything—when there's scenarios where they need to be adept at working around the edges, what happens if there's something that goes slightly awry, if there's a fault or some occurrence, they need to be able to manage those scenarios.
The fueling site is located at Pier 68. That's another part of our permitting process that we focused on very closely is not only the vessel, but then the establishment of the permitting site that builds on, again, a lot of the LNG experience from previous supply chain development projects. In this case, the trailer comes in and it's just a cascade fill, so it's the pressure differential from the trailer over to the tanks on the top deck. If you can see there's a small little hose that extends out from the vessel side and that's where the fueling, the fuel transfer happens. In more detail, the—so the transfer rate from the truck to ship in this cascade fill environment is about 85 to 100 kilograms an hour. So, the fueling operation will do about 20 minutes of setup, 20 minutes of breakdown, and then an hour per trailer for the fueling. Once we fuel, we can operate three days consecutively at least without needing to fuel again. So again, our energy density is quite high.
I won't dive into much detail, but we've got operations manuals, emergency manuals, and then again, another set of crew training related to who is the person in charge. Everybody involved in the fueling operation has a defined role that is very clearly established, and we perform a number of checklists prior to starting any fueling operation. The Coast Guard in the beginning used to come out and then as time went on, they have become much more comfortable with the fueling operation as they've seen the crew become more and more competent. And so, they don't show up anymore and they've got—the crew is handling the fueling on their own.
The fueling process goes through a number of pre—manual pre-setup checklists, and then we go through, we just kind of transition over to an automated system, and the automated system takes over. We do a pre-fill inert, high pressure leak check, and then we end up filling each bottle one by one from the trailer to the vessel. And then we do the same kind of post-fill inert and post-fill cleanup afterwards.
I kind of briefly talk about this, but I won't spend too much time on it. There's so many lessons learned from this project. Some of them are technical, some of them are regulatory lessons. Broadly, education is a really important component of what we're doing here, so educating the crew, but educating the regulatory environment as well. The U.S. Coast Guard has been massively helpful to us on the technical side. There's kind of diagnostic visibility and power management system tuning that the purpose of this project was to learn from the project and make improvements over time. We've made a lot of strides towards a more reliable and consistent operation over time. And then on the hydrogen costs front, on the fuel supply chain side we are actively working on lower costs and lower CI, or zero- or negative-CI-score hydrogen, and which is in the works. And with that, Pace, do you want to transition back? I'll give it to you for a quick second to talk about where we're going.
Pace Ralli: Yeah, thanks. We, we're working with compressed hydrogen now as you know, on this one, that's sort of helping us prove and pave the runway for that regulatory framework. Just real quick on the pressures, it's not super high pressure compared to what you might see with buses and cars. We're working at, see what's it coming out of the trailer and we receive it at 250?
Elias Van Sickle: Yeah, so the working pressure of the tanks on the trailer is 450 bar, which is actually lower than some of the hydrogen fueled cars on the road, and then it translates over to 250 bar on our vessel side.
Pace Ralli: Yeah, and we have 10 tanks, they're composite tanks, and those are on top as Elias pointed out. And then, you know, our fuel cells are on the stern. There's a fuel cell, a dedicated fuel cell room and then our electrical propulsion and batteries are in the hull.
As we look into our next designs, we're trying to, you know, improve with every iteration but not take on too much change. So, we're going to keep with this next design, which is twice as big, twice as fast, 150 passenger, 25 knots. We're going to use gaseous hydrogen again, essentially the same types of tanks, and this time have our fuel cells in the hull rather than on the stern in its own dedicated room. So that'll be sort of the one step change difference.
And then really this is crossing a huge threshold for us from, you know, a demonstration boat to what's really a commercially applicable, you know, very prevalent design in the U.S. ferry market and internationally something that, you know, has the speed and size capacity that is really used a lot around the U.S. So, this design is currently getting close to being finished in the next quarter, and we're going to be looking to commence a construction project by next year on that.
And then as we look around the country, if you break down the ferry market you also see a lot of 300 passenger vessels, and 450. And those are largely sort of sizes staged out by the regulatory classes, subchapter classes. And so, as we get into these larger boats that go faster or moving, you know, moving more steel through the water, then we're starting to look at liquid hydrogen for energy density and having, you know, enough to go several days without having to fuel.
And this looking at liquid hydrogen is actually somewhat parallel to a lot of work I've done in liquid natural gas with maritime shipping. Liquid natural gas, LNG fueling for ships, container ships and crew ships and tankers that exist now. And that's a cryogenic liquid transfer and cryogenic tanks on top. And so, yeah, this is the some of the next designs we're looking at with the 300 passenger and then also with the RoRo, or roll-on roll-off vehicle and passenger ferry called the RoPax.
Elias Van Sickle: Broadly, California because of its industry leading and nation leading stance in terms of the commercial harbor craft regulations that it has in place, that has been the anchor market for us here, but we want to grow that relationship in California. We want to build on our success of the Sea Change here in California. But we're also starting to expand our aperture to both other markets in the U.S. Pace mentioned New York, Seattle, Boston, those are some other key ferry markets in the U.S., and then potentially as well Texas, North Carolina. Probably more on the RoPax ferry side with the vehicle ferry.
And then internationally the scope and set of emissions regulations are, in Europe in particular, becoming more and more stringent and operators are now starting to have to pay for their CO2 emissions, so there does exist the potential for us to deploy internationally as well. And you know, places like Singapore just on the other side of the world have regulations in place that very closely parallel CARB’s commercial harbor craft regulation.
So, we are entering a growth phase here where we're building on our first project and looking to expand. And with that, I appreciate the opportunity to present here, and we'll stop my share and take some questions.
Pace Ralli: Kyle, do we take questions from you from the Q&A box or…
Kyle Hlavacek: Yeah, there's Pete.
Pete Devlin: Yeah, here, I'm sorry I was on mute, sorry. Anyway, great presentation, you guys. Wonderful project. Congrats again. It's great to see, take the idea we had 10 years ago and really bring it home over the finish line. We got a couple of questions here.
I'm going to paraphrase the first one. Somebody went on a ride of the Sea Change this past fall and said there wasn't much advertising about, you know, the vessel either on the boat or around the, you know, the shore and the pier. So, wondering, was that intentional under-advertising or are there other factors preventing more promotion?
Pace Ralli: I'll quick take that. When we own the boat, we lease it to an operator. It's essentially the operator's boat and their service. So, I think that feedback has been given to SF Bay Ferry maybe a few times to play up the hydrogen part of it a little bit more. And so, I think they're, they've taken that feedback. They have—they've had a lot going on, they've had a ton of, WETA and SF Bay Ferry have done some amazing, have started some amazing projects with grants that they're going to be working on with battery electric ferries and all the charging infrastructure and docks and such, so I think it was just a product of having too much going on. But they're going to be increasing that advertising a little bit more. But that’s good feedback.
Pete Devlin: OK, great. Thanks. I'm going to skip down then back. Where is the hydrogen produced?
Pace Ralli: Currently, we use hydrogen that's existing hydrogen coming into the SF Bay area for automotive, so it's coming for car fueling stations. And we pick it up in that trailer that you saw in the picture, we pick it up from their trans-fill station. And as we are getting in, you know, we're just getting through our demonstration phase with SF Bay Ferry, which starts with only a three-day service, and then we're increasing to five days very soon here and then looking to get up into seven days. As we get our fueling cadence more normalized, then we're going to be, yeah, looking at the landscape of supply options.
Pete Devlin: OK, great. I'm going to kind of combine one with another one I just saw flash up, but, you know, refueling equipment—is there equipment that will enable refueling directly from a liquid tanker since you mentioned liquid hydrogen vessels that you're working on? How do you envision that?
Pace Ralli: Yeah, there is equipment out there that enables a liquid tanker to provide both liquid hydrogen as fuel as well as gaseous with a step in between to vaporize it. That equipment exists, for example, in the RoPax vessel that we're looking at, which we hope to be actually in construction this coming year as well, for the RoPax vessel it's a design that already exists and is in operation in Norway. They have a liquid hydrogen tanker pull alongside and it connects to the vessel through a kind of a bunkering tower or transfer tower, and we probably would be replicating that same system for the RoPax vessel to receive liquid hydrogen. This is also being done, you know, with cryogenic liquid natural gas for ships.
Pete Devlin: Right. Very good. Thank you. The next one is what is the role of the battery to store excess energy generating fuel cell while they're in operation, how does that work?
Elias Van Sickle: Yeah, I can take that one. The fuel cells really like to be run at their optimal efficiency and a pretty steady load. So that's what we try to tune the power management system to have the fuel cells be steady the whole time. So, the duty cycle of ferry is pretty stop and start. We run, we stop at the dock for the passenger loading and unloading. And during that time, the fuel cells are still running at their steady capacity charging back up the batteries, which have been drawn down during our transit. So, the batteries kick in during our transit to provide an extra boost, and generally the batteries are ramping up and down faster and more frequently than the fuel cells are.
Pete Devlin: Right, right. Thank you for that. Next one is, was there any difficulties faced with corrosion of fuel cell and air loaded with saltwater spray?
Elias Van Sickle: Yeah, it's a good question. So, our room at the stern of the vessel was specifically designed for this to protect the fuel cells from the marine environment as well as create all the safety characteristics that we require from the Coast Guard. We filter our air in a number of ways, so the room is very well ventilated, but there any room—any air that enters the room is filtered and then it's filtered again prior to entering the fuel cells. So, we've kind of got a dual stage filtering mechanism to prevent any salt air from getting in.
Pete Devlin: Very good. Have you explored using an electrolyzer to create your hydrogen? This says onboard. I'll just say it says onboard, but I'll say, create your own hydrogen one way or the other.
Elias Van Sickle: Pace, do you want to take that?
Pace Ralli: Yeah, sure. The amount of power that it requires to have an electrolyzer onboard, it wouldn't hit the efficiencies that we need, and we wouldn't have the power. But we have looked at producing hydrogen through electrolysis equipment at or, you know, near where the vessel is operating. That would be, we think, a really good pairing. There was a DOE project we'd be excited to see happen something like an electrolyzer on the pier or near where the vessel fuels today. And that would enable us to produce all or some of our hydrogen and then as well as receive from other sources around California.
Pete Devlin: Yeah, thanks for that. I think the next one's mine. Says, does the DOE have set goal for how many hydrogen applications will be used at ports in maritime? Funny you should ask, today a new document is being released. You can take a look at it online; it's called the intermodal action plan for maritime. And explains our strategy for different maritime applications and some about ports, not all about ports, but so you can look at our strategy there for maritime online.
The next one is, what kind of maintenance do the fuel cells require? Is salinity having an impact on performance and lifetimes?
Elias Van Sickle: Yeah, so we have a—the vessel holistically has a planned maintenance schedule that we abide by, and so the fuel cells we have… Because the project started five years ago, fuel cells do experience some degradation over their life. The membranes do degrade to some degree. So, because the project has been around for five years, we have done some fuel cell refurbishments as a function of just some degradation for individual modules that weren't performing quite up to the degree that we wanted them to. Generally, aside from that, we've had little, you know, pumps and ancillary systems that have required replacement on the odd occasion, but generally, once the fuel cells are running, they run quite well.
Pete Devlin: OK. Very good. The next one is, would you ever consider ammonia or methanol as a feedstock for future vessel model designs?
Pace Ralli: Yeah, I, we've looked at both. We're not as familiar, just been so heads down on getting this technology and project over the finish line. I think methanol—you know, just because we're in the passenger space in terms of the type of vessel that we're currently working on, methanol is definitely more interesting than ammonia would be. I think ammonia is still a bit scary. I think it's a really good, you know, potential ocean-going fuel. Methanol is really interesting because we can store it with, you know, ambient temperature, pressure, similar to how diesel is stored today and have a decent energy density. And we like the technology that is being developed by e1 and maritime partners with the methanol to hydrogen reforming onboard that's still probably got a few years of, ahead of it to get it into commercial application. But certainly, there's a role to play for those fuels.
Pete Devlin: OK. OK, so that's it for Q&A. Kyle, is it ok if I take a peek at the chat? I know you said twice the Q&A, not chat, but I see some chat things coming up. Is that alright?
Kyle Hlavacek: Yes, that’s fine.
Pete Devlin: I think we got, we got a little time, so I don't want to miss any good questions, right? Let's see, oh, how many transit hours or miles do you get? You mentioned three days of operation?
Elias Van Sickle: How many transit hours do we get from one fueling?
Pete Devlin: Yeah, from—yeah, I think that's what they mean. Since they said three days of operation and you said three days of operation is what you can get with one fueling.
Elias Van Sickle: Yeah, so just historically we were just running some numbers based on how much this vessel has operated. We've operated nearing 100 days of operation just over the course of its relatively short life so far on the water, so just as a data point. And then the operations—we do four round trips per day on that demonstration route currently, and that's three days times four round trips. We burn about—I say burn, but we consume about 10% of our capacity, a little bit more than 10% per one day. So, by the time that we've done three days’ worth, we've consumed approximately 30% to 35% of our usable hydrogen capacity. And as we're ramping up service, so too will the— the demand will increase as we ramp up service to our five day a week schedule.
Pete Devlin: Right, right. Well, next one—I'm skipping down because you've already kind of answered some of these in the Q&A. So, will cryogenic storage add much operating costs? Have you looked at that yet?
Pace Ralli: Yeah, it will definitely add CapEx. I mean cryogenic equipment onboard is going to be more costly storage equipment than the gaseous, similar to liquified natural gas, double wall tank pressure vessels. But those, you know, those exist. As it relates to operations, not particularly—it shouldn't really add to the operating costs significantly. It’s really more of a CapEx issue.
Pete Devlin: Yeah. Yep. Let's see. Is the mobile refuel trailer custom built, or can you actually buy one commercially?
Elias Van Sickle: Yes. We, so far, we're leasing these, but yes, there is the option in the future for us to buy trailers if we want to.
Pete Devlin: Yeah, ok. Here's an interesting one, are you using green hydrogen only or not—meaning not hydrogen refined from fossil fuels, or are you just going with market?
Pace Ralli: Yeah, getting into service, we're just taking what hydrogen we can get our hands on in SF Bay. That is not green as defined by, you know, really—it's lower carbon as, you know, with renewable content, but it's still SMR hydrogen that's coming into the Bay for automotive. And that's changing very soon because it's the objective of our off-taker and end user to be using green hydrogen. So, as I mentioned, we're ramping up service from three days to five days and to seven days. We're in that transition period now, and so we're looking at changing our supply and that will be green hydrogen only. It's SF Bay Ferry’s objective to use green hydrogen or low-carbon, zero-carbon hydrogen.
Pete Devlin: Right, right. This is an interesting one. How does the hydrogen operating cost compare to natural gas, diesel, bunker fuel, and others on a dollar per mile? You guys looked at that at all?
Pace Ralli: Yeah, that's the million-dollar question that we're trying to get to. We need a lot of operating data to get there, which we're currently building up that database. And we have, as Elias mentioned, we have, you know, a lot of analysis around total cost of ownership and obviously the operating dollars per mile are part of that total cost of ownership analysis. I'd say we're probably three to six months out from having the data necessary to be able to do that, and that's something that we want to make known to the industry. We expect it to be at a premium but really when you think about operating costs, the crew costs are no different than the diesel or other fuel vessels. It’s really around the fuel cost.
Elias Van Sickle: I'll also just add just one more point, within California, at least for now, there is a little bit of a binary outcome. It's either there's a vessel operator that is compliant or not compliant, and so we are very sensitive to costs in the sense that we want to be passing on as competitive a operation vessel as possible, but there's also either a vessel that is compliant by being zero emissions or not compliant, so it's a little bit of an apples to oranges comparison between those.
Pete Devlin: Right, so to add to that, because it does say to me, also, for anybody who's interested, we did a ferry boat analysis at Argonne National Lab. So, if you go to Argonne National Lab and say ferry boat total cost of ownership, you will get a report. It's pretty new, it's about a year and a half old, and it shows, you know, the breakeven point for hydrogen, what does hydrogen have to be in terms of cost to compete with diesel, to compete with NG, bunker fuel—we didn't cover that because that's kind of a different, you know, it's like heavy vessel oil and stuff like that. But you'll see some information on how those costs compare. What does hydrogen need to be to break even with diesel if you look at that Argonne report.
I think the next one's mine too. Where is the report posted online? Since I mentioned there's a report coming out today. I would say just hit energy.gov and say, modal action plan, and it will come up, right? Energy.gov modal action plan and it will come up. So, let's see what else we going to look at here? What is the expected lifetime of hydrogen fuel cell, you guys looked at that. What is the current cost of the rack configuration that you were using?
Elias Van Sickle: Yeah, so this is—I'll just say generally also that fuel cell technology has been developing a fair bit in at least for the maritime space, so the fuel cells that we used for the Sea Change aren't necessarily the fuel cells that we'll use for the next applications. There's been certain fuel cell, fuel cell companies that have curated their development more toward the maritime space so we can have instead of designing a whole room that is custom to provide these safety characteristics, we can just drop in the off-the-shelf unit. So that's just something that's attractive going forward.
The other thing is that the membranes, there's been some membrane development it seems that is making the membranes more robust and durable for the long term. Right now, we're looking at refurbishments probably every five years and, for these fuel cells, and from a CapEx perspective, it's, you know, I won't say exact numbers but purchased for a little bit less than a million dollars, this fuel cell stack. Hopefully that answers some of the question.
Pete Devlin: OK. Yeah, I think it gets at it. Let's see, I think this, oh—no, this one's for you. What is the planned route? Once you get through your demo, you're going from pier to pier right now. What happens after you get through that demo?
Pace Ralli: Today is operating, you know, purposely on sort of a tourist route as—Elias pulled up the map earlier, it's Fisherman's Wharf to Ferry Building, it's not really a commuter route. Really what we'd like to see by the end of their, of this demonstration period, the first six months, is for it to be transitioned to a, you know, critical commuter route. Reliability is key in that and that's not just reliability of the vessel and the technology but also of the fueling supply chain and all this is brand new. So we've made some really, you know, great strides in getting that in place, and I think by the end of the demonstration period, we'll be looking at a service to a commuter center such as Mission Bay, which is south of the ferry building, not too far, can be served by a slower and smaller boat, but also needs to be served by a reliable, you know, commuter asset that's operating every morning and every afternoon. That's what this technology can do, and we really want to show that on that route.
Pete Devlin: Great, thanks for that. I think this one's for me and then I have a personal question to ask you. This one says comments on the loss of hydrogen during fueling, storage of liquid hydrogen and hydrogen as a greenhouse gas. So, I'll just say outside of this project, we have three projects just kicking off to get at the loss, boil-off losses of liquid hydrogen at heavy-duty refueling stations, and you can go online and look at those who are just kicking them off. We know boil off is a huge issue for heavy-duty applications and there's a number of innovative approaches that our industry partners want to try to get at that problem and see if there's a way to minimize it or eliminate it. There are ways to use the boil-off as one way and that can save a lot of losses. So, if you want to take a look at those three projects, that's what we're working on.
And then, let's see, we got 2 minutes. So, if one was to go to San Francisco, which I am doing in two weeks to spend Christmas with my daughter and grandson, could you take a ride on this boat? Can I, can I go head down there and get a ticket?
Elias Van Sickle: Yeah. It's, the ride is actually free. So just to clarify right now the ride is free, so we invite everyone to come onboard and, yeah, again, our schedule has so far been Friday, Saturday, Sunday—weekends, four round trips, and that's scheduled to be ramping up shortly.
Pace Ralli: It is amazing to see when people get onboard. It's—there's this sort of binary outcome in your mind, like, you know, does this technology work? And then you ride it and it's just like any other ferry, it's quieter and there's no black smoke, but other than that it feels the same. And by the time they get off on the other side of the ferry ride, it's like, yeah, that technology works and let's see more of, you know. So, we want to get people onboard and it really helps with the mindset.
Pete Devlin: Yep, I'm going to try to get on there. Anybody listening, you want to take a trip to San Francisco and check it out, it's pretty amazing. I'm very much looking forward to my little ride with my grandson. With that, we are out of time, and I'd love to thank you guys for a fantastic presentation and great answers to the questions and wish you the best of luck in your new projects and look forward to watching that and talking to you about that soon.
Pace Ralli: Thanks everyone for your support.
Pete Devlin: Thank you.
Seamus Nolan: Thanks so much, everyone.
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