Ballard announces definitive agreements with Azure Hydrogen for China fuel cell bus program; next-gen FCvelocity-HD7 module
Further to the MOU announced on May 28 (earlier post), Ballard Power Systems has signed multi-year definitive agreements to support Azure Hydrogen’s fuel cell bus program for the China market. Beijing-based Azure plans to partner with Chinese bus manufacturers in a phased development program for deployment of zero emission fuel cell buses in China, utilizing Ballard’s fuel cell technology.
For the first phase of the program, Ballard has agreed to provide a license, associated equipment and Engineering Services to enable assembly of Ballard’s next-generation FCvelocity-HD7 bus power modules by Azure in China. As per the agreements, once this assembly capability is established, Azure will assemble modules with fuel cell stacks to be supplied exclusively by Ballard.
The FCvelocity-HD7 module is designed specifically for integration into bus applications. This key product development initiative has been supported by Sustainable Development Technology Canada (SDTC), an arm of the Government of Canada which helps commercialize Canadian clean technologies, readying them for growth and export markets.
Ballard’s FCvelocity-HD7 will feature a number of enhancements over the current production FCvelocity-HD6, including: reduced parts count; fewer moving parts; integrated air compressor and coolant pump; and lower parasitic load.
The module will also utilize fuel cell stacks manufactured through a high-volume, low-cost process. The enhancements and manufacturing process will reduce capital and operating costs of the fuel cell module, making the total cost of ownership competitive with other zero emission technologies, according to Ballard. In its Annual Information Form submitted in March, Ballard said that it anticipates the FCvelocity-HD7 will reduce the total cost of the fuel cell module by 25%.
Ballard and its consortium partners recently received approximately $6.7 million in funding from the US Federal Transit Administration (FTA) under the National Fuel Cell Bus Program for the deployment of two next-generation fuel cell buses incorporating the FCvelocity-HD7. Under that program, Ballard will deliver two FCvelocity-HD7 modules to BAE Systems for incorporation into its HybriDrive propulsion system, with the final bus assembly to be completed by ElDorado National. (Earlier post.)
The expected value of the Azure contract to Ballard over the initial 12-months of the first phase will be approximately $11 million, related to the license for module assembly together with associated equipment and services.
If Azure’s China bus program progresses as planned, the contract will generate value beyond the $11 million license revenue, commensurate with the volume of fuel cell stacks to be ordered.
The signing of the agreements took place at the World Hydrogen Technologies Convention in Shanghai (WHTC2013). The definitive agreements require approval of the Chinese Government.
Azure plans to secure funding from Chinese sources, including both private investors and Governments, to enable the development of fuel cell bus fleets in China for initial public transit service by 2015.