Truck companies and shippers regularly announce the addition of new zero emission vehicles to their fleets, most of them battery-powered. And there are announcements of hydrogen-powered trucks as well, though that has almost exclusively been in California, which has a combination of coming mandates and the Low Carbon Fuel Standard, which allows the owners of those hydrogen vehicles to earn LCFS credits that can be sold into an active market for those assets.
With all that in mind, it was notable this week that DHL Supply Chain is acquiring two Nikola-built hydrogen trucks, to operate strictly in Illinois on behalf of its dedicated client, spirits supplier Diageo North America. It marks DHL’s first foray into hydrogen trucks.
Two trucks is a small amount compared to the 88 that Nikola reported to have sold in the third quarter. But as FreightWaves’ Alan Adler noted in a recent Truck Tech newsletter, the final destination for much of Nikola’s output remains California.
(A Nikola spokesman said most of the company’s hydrogen trucks “are being operated in California, with a handful in Canada for Walmart Canada and a few others”).
The Nikola trucks take hydrogen and convert it to electricity via a fuel cell, the electricity then drives an electric engine.
Stephan Schablinski, vice president, operations excellence – GoGreen at DHL Supply Chain, said in an email to FreightWaves that the trucks will operate exclusively within Illinois, “moving between Diageo (NYSE: DEO) facilities, mainly within Plainfield in the beginning.” There also will be use of the trucks in servicing Diageo customers.
Diageo has what is described as a “campus” in Plainfield. Refueling will be done fully at that campus, though Schablinski said DHL will look at “interstate options, as more hydrogen sourcing and fueling options become available.” At Plainfield, the trucks will be refueled with a HYLA modular refueler. HYLA is Nikola’s hydrogen distribution arm.
The hydrogen will initially be in gaseous form. A DHL spokeswoman said liquid hydrogen is more suited for larger uses of hydrogen and that DHL (XETRA: DHL.DE) might switch to the liquid form if demand warrants.
Proposed tax break under the IRA
In the same way that hydrogen has been incentivized for use in California by the LCFS as well as mandates such as the Advanced Clean Fleets rule and its companion, the Advanced Clean Trucks rule, the Inflation Reduction Act contains proposed tax credits for hydrogen use. The credit for green hydrogen – which is hydrogen shown to be produced using fully renewable energy – is $3 per kilogram. Hydrogen experts have said that works out to about $3 per gallon on a diesel equivalent.
Schablinski said the hydrogen to be consumed by the two trucks will be produced using fully renewable energy. In hydrogen-speak, that is considered “green hydrogen” and the proposed tax credit for green hydrogen is the most valuable of the hydrogen incentives in the IRA.
DHL’s hydrogen vehicles are expected to be on the road by the end of the year, Schablinski said.
As is almost standard any time a company touts the use of a zero-emission vehicle, the ultimate user – in this case, Diageo – notes that it has a net zero commitment.
“Incorporating hydrogen fuel cell trucks into its fleet will contribute to Diageo’s broader efforts to reach net zero carbon emissions across direct operations by 2030 and its value chain by 2050 or sooner,” the prepared statement said.
A year and a half in the making
In its news release announcing the hydrogen truck initiative, it was noted that the process to come to a decision took 18 months.
Schablinski was asked about the process and what questions needed to be answered in a “go/no-go” decision. It’s the type of process that DHL already has undertaken elsewhere in its operations, as it employed 10 battery electric vehicle yard trucks in Plainfield and 100 system-wide.
Schablinski supplied nine questions he said needed to be answered. Among the key ones: “how does this technology work in general? What are the sustainability benefits vs. other technologies? What are its operational constraints vs. a conventional diesel truck (noting such issues as range and impact on payload)? How long does it take to fuel a truck?”
With that research in hand, Schablinski said outreach brought in various parties into the decision. It included the obvious, like people at Diageo and DHL. But less obvious were the building owners where the hydrogen facilities were to be placed, and first responders in Plainfield, who would need to be prepared to deal with any incidents connected to hydrogen storage, delivery and fueling.
“And, lastly we spent time on an implementation plan that brings the many components together that are required to operate these two new fuel cell trucks, which involves the two trucks themselves, but also the fueling equipment, including required permitting; the fuel sourcing and supply chain; the full service, repair and maintenance for vehicles and fueling equipment; the site safety plans; and the required training and on-boarding,” Schablinski said in his email.
A full hydrogen refueling will provide a range of up to 500 miles, DHL said.
DHL’s estimates are that carbon emissions from the two vehicles will be reduced 80% in one year compared to a diesel vehicle.
The benefits are not just in terms of emissions. “The trucks also offer significant improvements in driver comfort and safety by reducing noise and vibrations, leading to less driver fatigue,” DHL said.
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