The hydrogen option as a

carbon free energy carrier

Dr. Andreas Opfermann

Head of Technology & Innovation Management

Ludwigshafen, 10th of March 2015

2

The Linde Group

The Linde Group (in € million) 2013 2012 Change

Revenue 16,655 15,833 5.2%

Operating profit1 3,966 3,686 7.6%

Operating margin 23.8% 23.3% +50 bp2

EBIT 2,171 2,055 5.6%

Profit for the year 1,430 1,341 6.6%

Number of employees as at 31.12. 63,487 62,765 1.2%

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3

BASF and Linde: partners for more than 100 years

BASF SE

PAST PRESENT

plant Ludwigshafen & historic logo with bavarian lion

plant Höllriegelskreuth and historic logo

100 years of

BUSINESS PARTNERSHIP

Steam Methane Reforming Plant

in Ludwigshafen

(contracted 2008)

One of several Watergas-Plants

(contracted 1910)

Linde with wide portfolio of energy topics in its business

and technology portfolio

4

Hydrogen as fuel

Photo-voltaic

Clean coalN2 EOR

Fossil (gaseous)

BaseloadLNG

OxyFuel

FloatingLNG

Refinery Hydrogen

Biomass conv.

GreenHydrogen

Renewable

CO2 EOR

LPG

Unconv. gas

NGProcess.

Merchant LNG

GTL

Fossil (liquid, solid)

PCC

CO2 networks

Energy value chain

Energy conversion

Energy transport,storage and usage

Feed

stock

Energy storage

NRU

Geo-thermal

Solar-thermal

Heat recovery

Energy extraction

Cogene-ration

Wind energy

55

De-carbonisation of energy carriers in history

CO2 ratio

Industrialisation Tomorrow

Coal Crude oil Natural gas Hydrogen

C/H

ratio approx. 2 approx. 0.45 0.25 0

6

Why Hydrogen?

Hydrogen offers…

… CO2 reduction potential … diversification of primary

energy sources

… zero emissions at the tailpipe… multiple application usages

7

Why Hydrogen is on the plate now?

Financing: funding for infrastructure

Legislation: push for emission reduction OEM progress: serial production

Hydrogen stations: serial production

Hydrogen value chain: the overall system counts

8

*Steam Methane Reforming/Partial Oxidation | ** Carbon Capture and Storage

PRODUCTIONSMR/POX*

SMR/POX* + CCS**

Bio-based Processes

Electrolysis

New processes

UTILISATION

Industrial Use

Energy Carrier Use

Source: Siemens

Source: KBB UT

Liquefaction

Transport

Storage

DISTRIBUTION

Hydrogen value chain: the overall system counts

9

*Steam Methane Reforming/Partial Oxidation | ** Carbon Capture and Storage

PRODUCTIONSMR/POX*

SMR/POX* + CCS**

Bio-based Processes

Electrolysis

New processes

UTILISATION

Industrial Use

Energy Carrier Use

Source: Siemens

Source: KBB UT

Liquefaction

Transport

Storage

DISTRIBUTION1

2

3

4

5

Steam methane reforming:

dominant industrial production method for hydrogen

10

1

11

Steam methane reforming with carbon capture:

CO2 reduction potential for conventional plants

Demin

water

Feed

Air

Fuel

Reformer

Steam System

CO-shift H2-PSA Hydrogen

Fluegas

Steam

1 Medium pressure, low CO2 content � Absorption (MDEA)

2 Low pressure, medium CO2 content � PSA, FlashCO2, CO2LDSep, MTR

1 Low pressure, low CO2 content � Absorption (Amine )

Process Assessment

+ CO2 purity

+ fuel demand

- retrofitting

+ CAPEX

+ fuel demand

- power consumption

- retrofitting

- CO2 purity

+ CO2 content

+ CO2 purity

+ retrofitting

- space

- pressure

2

1

3

2

1

2

31

2

3

Bio-based processes: glycerine pyroreforming

pilot plant in Leuna

Worldwide first plant for green hydrogen

production from Glycerine (By-product of biodiesel

production)

Start of operation: 2011

Capacity: 50 Nm³/h

Glycerol Purification UnitPyro-Reforming Unit

Crude glycerine tank

glycerine purification

Pyrolysis Reformer

CO-Shift

Steamreformer 2

PSAresidue

Hydrogenprocess steam

Pure glycerine

Pilot Plant Leuna GL 50

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3

supported by:

Process (schematic) Description

Electrolysis: Power-to-Gas pilot plant in Mainz

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Project set-up:

● World’s largest power-to-gas pilot to manage local grid bottleneck in Mainz (start-up: 2015)

● Production: PEM electrolysis with 6 MW peak

● Conditioning: Ionic Compressor for flexible and energy-efficient operation

● Storage: 1000 kg pressure storage (~33 MWh)

● Use: industrial gas & H2 as fuel & grid injection (power-to-gas)

Targets:

● Management of grid bottleneck

● Testing and experience with components

● Intelligent control and market integration

supported by:

Electrolysis with 6 MW

peak load

Status 26th of January 2015

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Key facts

Partners: Stadtwerke Mainz, Linde, Siemens & Hochschule RheinMain

Electrolysis & plant overview

New process technology: methane pyrolysis

• Products: Hydrogen and Carbon

• Process: cost-competitive world scale H2 (10 - 100 kta) with

CO2-footprint advantage & carbon to steel or non-ferrous

value applications

• Funding: BMBF funding of 9 m€

• Timeline: development activities until 2016

Unique selling proposition

• Energy efficiency:

for H2/SynGas technologies for central

production sites

• Two-Product-Approach:

Captive use of industrial hydrogen and

high-purity Carbon for metallurgical

markets (global market)

• Emission reduction:

up to 50% emission reduction for

pyrolysis-H2 compared to steam

methane reforming

• Utilisation:

flexible use in industry and as low-

emission fuel in mobility

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NG pyrolysis

Natural Gas (NG)

Power Quality carbons

H2

Key Facts

Process (schematic)

supported by:

Partners: BASF, Linde, ThyssenKrupp Steel, ThyssenKrupp Industrial Solutions, the, BFI & TU Dortmund

Hydrogen value chain: the overall system counts

15

*Steam Methane Reforming/Partial Oxidation | ** Carbon Capture and Storage

PRODUCTIONSMR/POX*

SMR/POX* + CCS**

Bio-based Processes

Electrolysis

New processes

UTILISATION

Industrial Use

Energy Carrier Use

Source: Siemens

Source: KBB UT

Liquefaction

Transport

Storage

DISTRIBUTION

A

B

C

Liquefaction: current technology and potential for

enhanced efficiency

Dry Piston

Type

Compress

ors

Adsor

bers

Joule-Thomson Expansion

in Ejector

Liquid H2

(to

Storage)

Expan

sion

Turbin

e 1

Gaseous H2

Feed

Cooling Water Liquid N2

for

Precooling

Vacuum

Pump

to

Atmosphe

re

Compression System Liquefier Coldbox

300 K

80 K

20 K

Liquefaction

and

o-p Conversion

Expansion

Turbines 2

and 3

Hydrogen Cooling Cycle

Gaseous

H2

(from

Storage)

Gaseous H2

(from

Trailer)

Potential Improvements

● Status:

globally six liquefaction plants built

in the last 10 years

● Energy consumption today:

~ 12.0 kWh/kg

● Improvement potential:

Compressor cooling

�multi-stage setting with inter-

cooling

� higher CAPEX

Advanced pre-cooling cycle

� closed N2 loop

� integration of LNG

Turbine Technology

�dynamic gas bearing machine with

highest efficiency

● Energy Consumption potential:

7.5 to 9.0 kWh/kg

A

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DescriptionClaude-based liquefaction cycle

1 equals approx. 66 – 120 vehicles/ Trailer; 2 equals approx. 700 vehicles / Trailer; 3 equals approx. 180 – 1.800 vehicles/hour (assuming 5kg/vehicles)

- Economics strongly related to

distance and transport volume

- Very high capacity

- Relatively high investment cost

- Potentially long approval time

- Little flexibility if customer

demand changes

- Economic transport

distance for HFS < ~ 150 km

- Higher number of CGH2 sources

compared to LH2 sources (in

most countries)

- Lower capacity

� high demand requires

frequent deliveries

- Relatively high storage space

requirements

Transport: hydrogen distribution depends mainly on

distance and required volumes

- Economic transport

distance for HFS > ~ 150 km

- High capacity increases

delivery flexibility

- Significantly higher payload

- Relatively lower storage space

requirements

- Relatively high energy

consumption for liquefaction

- Transport @ -253 °C

- Capacity:

ca. 3.500 kg LH2 2

- Transport @ up to 300 bar

- Capacity (varying):

ca. 330 kg – 600 kg CGH2 1

- Transport @ 20 - 100 bar

- Capacity:

1.000 – 10.000 kg/h CGH2 3

Facts Advantage Disadvantag

e

Pip

elin

e

dis

trib

uti

on

Liq

uid

dis

trib

uti

on

Gase

ou

s

dis

trib

uti

on

B

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Transport: innovation in carbon fiber technology

improves transport efficiency

Techno-economic evaluation of supply pressure Technical data

H2 Trailer:● No. of composite cylinder: 100

● Water capacity: 34.5 m³

● Working pressure: 500 bar

● Hydrogen capacity: 1.100 kg

H2 Filling Facility:

● Filling/unloading time: 45-60 min

● Filling station capacity 2 x 3.000 Nm³/h

B

Carbon-wrapped composite cylinders

500 bar: selected upon fiber cost, weight constraints & compr. energy

Type 4 standard

Type 1 (steel)

Type 4 advancedoptimum

500 bar

Trailer

technology

by Linde

today

Ionic Compressor for industrial use

Trailer filling bay in Leuna

500 bar trailer with mounted cylinders

Storage: large-scale storage in salt caverns enables the

integration of renewables into the energy system

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Source: KBB Underground Technologies

10 100 1.000 10.000 100.000 1.000.000

Methane in salt cavern

Gaseous hydrogen in salt cavern

Liquid hydrogen spherical tank

Gaseous hydrogen in steel cylinders

Metal hydride storage

Compressed air energy storage

Li-Ion Battery

Storage capacity (€/MWh)

* Storage system only (no electrolysers, turbines, etc.); based on lower heating value;rough estimations

C

Comparison of storage technologies Cavern Storage & Hydrogen

Caverns:

● artificial cavities in salt domes

● Used extensively for storage of natural

gas, oil and chemicals

Hydrogen Caverns:

● Use: well-suited for seasonal storage

through low specific storage cost

● Storage volume: volume ~500,000 m³;

typical pressure range 60-200 bar

� filled with hydrogen, one cavern can

store about 170 GWhLHV

● Status: currently 3 caverns in operation

(USA, UK), 1 in construction (USA)

Remark: possible only where suitable salt structures exist (e.g.

Northern Germany, but lead time of up to 10a)

Gaseous hydrogen in salt cavern

Hydrogen value chain: the overall system counts

20

*Steam Methane Reforming/Partial Oxidation | ** Carbon Capture and Storage

PRODUCTIONSMR/POX*

SMR/POX* + CCS**

Bio-based Processes

Electrolysis

New processes

UTILISATION

Industrial Use

Energy Carrier Use

Source: Siemens

Source: KBB UT

Liquefaction

Transport

Storage

DISTRIBUTION

II

I

Industrial use: markets and applications for Hydrogen

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● Industrial use:ca. 500 Mrd. Nm³/a worldwide~ 1500 TWh/a

● Other applications: (<1000 Nm3/h): float glass, food (hydration), generator cooling

● Road transport:only ca. 5% of produced hydrogen is transported on road

Sources: DOE, Fair-PR

HydrogenHydrogen

Chemical Chemical

Hydrocracking

Hydrotreating

Ammonia 53%

(Urea, Fertilizers)

Semiconductor Industry

(incl. Photovoltaic)

Rocket Fuel

Methanol 8%

Polymers

2%(Caprolactam,

Adipic Acid �Nylon)

Direct Reduction of Iron

Ore

Forming & Blanketing

Gas

Polyurethanes

(MDI and TDI as

Precursor for)

HydrogenHydrogen

Chemical

Hydrocracking

Hydrotreating

Ammonia 53%

(Urea, Fertilizers)

Semiconductor Industry

(incl. Photovoltaic)

Rocket Fuel

Methanol 8%

Polymers

2%(Caprolactam,

Adipic Acid �Nylon)

Direct Reduction of Iron

Ore

Forming & Blanketing

Gas

Polyurethanes

(MDI and TDI as

Precursor for)

Refineries Refineries

31%31%

after Liquefaction after Liquefaction <1%<1%

IndustryIndustry63%63%

Metal Processing Metal Processing 6%6%

�

Refineries Refineries

31%31%

after Liquefaction after Liquefaction <1%<1%

Chemical IndustryIndustry

63%63%

Metal Processing Metal Processing 6%6%

�

I

Description

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0

20

40

60

80

100

120

140

160

180

200

Range

[km]

CO2 emissions

[gCO2 / km]

800600400200 1,6001,4001,2001,0000

ICE – gasoline1

2050

ICE – diesel1

2010

BEV

2050

1 ICE range for 2050 based on fuel economy improvement and assuming tank size stays constant. Assuming 24% CO2 reduction due to biofuels by 2050This study assumes biofuels blending in gasoline and diesel is limited to 24% beyond 2030SOURCE: EU Study analysis, “A portfolio of power-trains for Europe: a fact-based analysis”

FCEV

2010

2050

2010

2010

2050

PHEV

C/D SEGMENT

Low emissions and high range

Energy carrier use: FCEV achieving near zero CO2

emissions from well-to-wheel with high rangeII

Why Hydrogen is on the plate now?

Hydrogen stations: serial productionFinancing: funding for infrastructure

OMV: “Hydrogen fits well with our gas station business,

better than electricity for electric cars”, Feb 2014

Shell: “We believe that hydrogen with a fuel cell at the

current state of the art is as good as if not even

noticeably better than battery-electric driving“, June 2013

OEM progress: serial production

2013 2014 2015 2016 2017 2018 2019 2020 2021

Daimler

Toyota

GM

Hyundai

VW

BMW

Ford

Nissan

Honda

Start of serial production

g C

O2/

km n

orm

aliz

ed

to

NED

C

?75

93

105

60

80

100

120

140

160

180

200

220

2005 2010 2015 2020 2025

Korea

US

Japan

EU3

1) displayed car OEM CO2 values are European fleet 2011 only

2) penalties calculated with EU sales numbers and EU penalty regulations

Legislation: CO2 Reduction Goals for cars1

Status 2011

EU: based on 2011 values

845 mio€ penalty²

EU: based on 2011 values

366 mio€ penalty²

3) EU target average of all OEMs

4) continuation of NIP 1.0 currently under discussion; decision expected by June 2014

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- EU: FCH 2 JU (within Horizon 2020)

Focus: R&D + deployment of HFS

Budget: € 680 mio. (2014-2020)

- Japan: METI

Focus: deployment of HFS

Budget: € 220 mio. (100 HRS)

- USA: CARB/CEC

Focus: deployment of HFS

Budget: 20 mio. $/a

- GER: NIP 2.04

Focus: discussion ongoing (threat: R&D only)

Budget: potential for € 700 mio. (2015+)

Legislation: push for emission reduction

Commercialisation planning:

Increasing interest and activity from OilCos:

Advanced hydrogen refuelling technology for the

commercialisation of FCEVs

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Thank you.