Copyright 2016 by Plug Power Inc.

FUEL CELLSFOR MATERIAL HANDLING SYSTEMSFernando Corral

VP Sales, Western Region

MARCH 23, 2016

WHAT IS A FUEL CELL?

FUEL CELL: ELECTROCHEMICAL DEVICE

• Combines hydrogen and oxygen to produce electricity

• Water and heat as its by-products

OPERATES LIKE A FULLY-CHARGED BATTERY

• Does not run down or require recharging

RUN TIME IS DETERMINED BY QUANTITY OF FUEL STORAGE (LIKE A GENERATOR)

O2

H2

H2O

H+

E

PROTON EXCHANGE

MEMBRANE

CATALYST CATALYST

STATE OF THE INDUSTRY

APPLICATIONS USED COMMERCIALLY TODAY:

• Mobile, stationary and transport categories

FUTURE INDUSTRY DEVELOPMENT PENDING:

• Development of viable fueling options critical for growth

• Industry corporations taking charge in some markets

Source: E4Tech Fuel Cell Industry Review 2015

This presentation focuses on one segment: material handling/motive

MATERIAL HANDLING FACILITIES

Worldwide lift truck market

Region Orders Shipments

2011 2013 % Increase 2011 2012 % Increase

Europe (53 countries/territories) 330,616 310,503 -6.08% 324,073 317,726 -1.96%

Americas (55 countries/territories) 224,733 229,746 2.23% 207,485 220,069 6.07%

Asia (43 countries/territories) 379,969 362,911 -4.42% 373,697 363,816 -2.64%

Africa (56 countries/territories 17,587 20,185 14.77% 17,194 19,816 15.25%

Oceania (29 countries/territories) 21,677 21,060 -2.85% 19,359 22,297 15.18%

Total (263 countries/territories) 974,582 944,405 -3.10% 941,808 943,724 0.20%

Source: These figures are provided by the World Industrial Truck Statistics (WITS) organization.

MATERIAL HANDLING FACILITIES

~500,000 ELECTRIC FORKLIFTS AND PALLET JACKS SOLD ANNUALLY, WORLDWIDE

MULTIPLE BATTERIES REQUIRED PER UNIT

• Large battery charging rooms

BATTERY RUNTIME IS 6 TO 8 HOURS

• Batteries changed 2 to 3 times per day

Space-consuming battery room

CHALLENGES WITH STATUS QUO BATTERY USE

Space Needed to Change Batteries

• Average battery room size for large Distribution Centers and Mfg. Plants – 5,000 sq. ft.

Impacts on Productivity

• Battery change-out: 12-15 minutes per shift per lift truck

• As a lead acid battery discharges and voltage drops – MHE performance is reduced

• Performance decline up to 20% in cold storage

Cost

• 2 to 3 batteries per forklift

• Replacement every 3 to 5 years

• Battery rooms = $25 to $40 per sq. ft.

• $100k to $200k for specialized battery changing equipment

• Costly and dedicated personnel to change batteries

Safety

• 1,000 to 5,000 lbs. batteries require specialized equipment for change

• PPE & ventilation required for acid spills and gases released during charging

VALUE PROPOSITION FOR HYDROGEN AND FUEL CELLS

More Commercial Space

• Compact fueling stations replace large battery charging rooms

• ~7% of the distribution center is recovered to set up inventory and

revenue-generating operations

• Reduced electricity need & demand charges

Increased Productivity & Labor Savings

• 2-5 minutes to refuel a hydrogen fuel cell

• Constant voltage = no decrease in performance

• Full power in cold storage

• Operators refuel fuel cells – labor savings

Lower Operational Costs

• Eliminates the need to change, charge and manage batteries

Safety

• Fuel cell remains in truck at all times

• No acid or gas mitigation systems required

Sustainability

• Greenhouse gas (GHG) savings = Reduce carbon footprint by up to

80%

• No emissions

SPACE REDEPLOYMENT

BATTERY ROOM USED AS PALLET SPACE:

Converted to revenue generating

sq. ft.

• Assume: 60ft. X 85ft. battery

room

• Conservative calculation shows:

312 pallet positions

60

FT

85 FT

3 VERTICAL

POSITIONS

9 FT

11 FT11 FT11 FT

9 FT9 FT

11 FT

5 FT5 FT

81 FT

Pallet #s

# of Rows Pallet Positions / Row Total Pallets # of Vertical Bays Total $ / Pallet Position Total

8 13 104 3 312 750.00$ 234,000.00$

Additional Racking ($85/pallet) 85.00$ 26,520.00$

Total 207,480.00$

MOST COMMON HYDROGENREFUELING PROCESS

Liquid H2

• Transportation and storage

Gaseous H2

• Refueling process

H2 flows when all refueling

protocol checks passed

No H2 vented or released inside

the building during refill or

operation

Fill Pressure: 350 Bar at 15ºC

Gaseous HydrogenLiquid HydrogenPhase

Change

HYDROGEN INDOOR REFUELING

Refueling stations are designed to meet the following codes

• NFPA 2 [Hydrogen Technology Code]

• SAEJ2601 [Hydrogen Fueling Protocol]

• CGA H-5 [Installation Standards for Bulk Hydrogen Systems]

• ASME B31:12 [Hydrogen Piping]

Mandatory Safety Measures are built in each station

• Hydrogen Detection [Triggers at 25% LEL of H2]

• 15 feet radius electrical hazardous location (Class 1 Zone 2)

• Fire Detection

• Fire Extinguisher and Alarm Pull Station

• Fueling Protocol to identify leak check

• Emergency stops present to stop H2 flow during emergency

ONSITE HYDROGEN SUPPLY - LIQUID

ONSITE HYDROGEN SUPPLY –OTHER OPTIONS

Steam Methane Reforming

• Fuel processor reacts steam with natural gas to

extract the hydrogen molecule

• Most common method of providing bulk hydrogen

Electrolyzers

• Uses electricity to split the hydrogen molecule from

water

• Delivers hydrogen to the fuel cell refueling stations

• Essentially a “reverse fuel cell”

VALUE PROPOSITION FOR HYDROGEN AND FUEL CELLS

More Commercial Space

• Compact fueling stations replace large battery charging rooms

• ~7% of the distribution center is recovered to set up inventory and

revenue-generating operations

• Reduced electricity need & demand charges

Increased Productivity & Labor Savings

• 2-5 minutes to refuel a hydrogen fuel cell

• Constant voltage = no decrease in performance

• Full power in cold storage

• Operators refuel fuel cells – labor savings

Lower Operational Costs

• Eliminates the need to change, charge and manage batteries

Safety

• Fuel cell remains in truck at all times

• No acid or gas mitigation systems required

Sustainability

• Greenhouse gas (GHG) savings = Reduce carbon footprint by up to

80%

• No emissions

PRODUCTIVITY SAVINGS

Savings - Operator Labor

Operator Labor Rate (Loaded Rate) $ / hr $ 50.00 $ 50.00 $ 50.00

Sit Down Counter Balance Pallet Jacks Reach

Truck Count 30 30 6

Hours of Operation Per Day 24 24 24

Battery Solution

Total Changes per Day # / day 2.5 1.5 2

Travel to Battery Room minutes 4 4 4

Time to Change Battery minutes 4 4 4

Travel Back to Work Area minutes 4 4 4

Total Time Per Battery Change minutes 12 12 12

Total Minutes Per Day - Fleet minutes 900 540 144

Total Hrs Per Day Due To Changing - Fleet Hrs15 9 2.4

Hydrogen Solution

Hydrogen Fuelings per Day # / day 1.45 0.16 1.35

Travel to Dispenser minutes 0 0 0

Time to Fuel (includes 1 min travel time) minutes3 3 3

Travel Back to Work Area minutes 0 0 0

Total Time Per Refueling 3 3 3

Total Time Refueling Per Day Per Truck minutes4.35 0.48 4.05

Total Minutes Per Day - Fleet minutes 130.50 14.40 24.30

Total Hrs Per Day - Fleet hours 2.18 0.24 0.41

Hourly Savings Per Day hours 12.83 8.76 2.00

Annual Hourly Savings (Batt - FC) hours 4681.13 3197.40 728.18

Annual Cost Savings $ $234,056.25 $159,870.00 $36,408.75

Total $430,335

VALUE PROPOSITION FOR HYDROGEN AND FUEL CELLS

More Commercial Space

• Compact fueling stations replace large battery charging rooms

• ~7% of the distribution center is recovered to set up inventory and

revenue-generating operations

• Reduced electricity need & demand charges

Increased Productivity & Labor Savings

• 2-5 minutes to refuel a hydrogen fuel cell

• Constant voltage = no decrease in performance

• Full power in cold storage

• Operators refuel fuel cells – labor savings

Lower Operational Costs

• Eliminates the need to change, charge and manage batteries

Safety

• Fuel cell remains in truck at all times

• No acid or gas mitigation systems required

Sustainability

• Greenhouse gas (GHG) savings = Reduce carbon footprint by up to

80%

• No emissions

HEALTH AND SAFETY BENEFITS

Safety

InfluencersFuel Cells Lead-Acid

Hazardous liquids

controls

No hazardous materials;

Eliminates chance of

spills

Sulfuric acid spills

Acid control

methods

No control methods

requiredRequire spill kits

Ventilation No ventilation requiredVentilation required in

charging room

Fueling/Charging

location

Flexible H2 dispensers

put in high traffic areas

Fixed installation generally

out of the way

Worker physical

safety

No change outs reduce

worker injuries

Potential for crushed fingers

and toes while changing

batteries

ENVIRONMENTAL VALUE: REDUCING CARBON FOOTPRINT

7512 2810 2010 6990

1000

2000

3000

4000

5000

6000

7000

8000

LPG Truck Emissions Grid Charging Fuel Cell Emissions -Onsite Reforming

Fuel Cell Emissions -Liquid Hydrogen

To

ns o

f C

O2 P

rod

uced

per

Year

Greenhouse Gas EmissionsLPG / Grid / Reforming / Liquid H2

Based on an actual 260 truck fleet (typical mix)

75% Reduction of

Grid Charging

90% Reduction over

LPG

Carbon Emissions Reduction:

90% compared to LPG. 75% compared to grid charging.

H2 & FUEL CELL SUCCESS IN MATERIAL HANDLING

More than 10,000 fuel cells deployed

More than 1.7M operating hours

More than 1,000,000 hydrogen fills

Whole Foods Market is

committed to healthy food

and a healthy planet. We are

fulfilling that commitment by

choosing to use greener

technology in our own

operations that will improve

our productivity and lower

our long-term costs.

— Joe Strong, Whole Foods

WHY CUSTOMERS CHOOSE FUEL CELLS

Hydrogen fuel cells not only

provide greater productivity

and lower operating costs,

but will be an important

component of a clean

energy future.

— Tom Dziki, UNFI

We would have trouble with

the performance of the jacks

with the batteries wearing

down because of the cold.

Now with hydrogen there is

just no issue with regards to

temperature.

— Cherie Shipe, Wegmans

One of the main advantages

of this project is that it uses

very little electricity. The

hydrogen is the only source

of power for the fuel cells

and this project actually

avoids 1.8 million kilowatt

hours per year of electricity

consumption to charge

batteries.

— Briggs Hamilton, BMW

WHY CUSTOMERS CHOOSE FUEL CELLS

With these fuel cell material

handling units, we will be

able to maintain

productivity, decrease

operating costs and lower

greenhouse gas emissions

by 30%.— Lauren Steele, Coca Cola

Consolidated

From a financial standpoint,

when we started doing the

analysis, there is going to be

cost savings involved. So if we

can do something that is less

expensive, something that is

good for the environment, good

for our employees, it’s pretty

obvious what the choice is. We

will be using these jacks for the

next 6-10 years.— Wegmans

I think the biggest thing is that

people are just amazed at

how easy it is. It’s very quick

and easy. And by the end of

the day, even if you have one

bar left on the hydrogen tank

as far as being empty or full,

you lose no power. It’s

fantastic.— Cherie Shipe, Wegmans

We are pleased with the

performance of the hydrogen

fuel cells that we have been

operating and are excited to

expand our program with

Plug Power.— Jeff Smith, Walmart

Logistics

Corporate Headquarters

968 Albany Shaker Road, Latham, NY 12110

West Coast

15913 E. Euclid Avenue, Spokane, WA 99216

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