Hydrogen & fuel cell technology research & development programme: briefing by Department of Science and Technology

Meeting report

Department of Science and Technology
The Department of Science and Technology briefed the Committee on its hydrogen and fuel cell technology research and development programme, known as Hydrogen South Africa (HySA). The Department was represented by Dr Cordelia Sita, Chief Director: Hydrogen and Energy, and Dr Val Munsami, Deputy Director General: Research Development and Innovation. Dr Sita undertook the briefing.

Why hydrogen fuel cells? That was the question posed and the simple answer was because South Africa (SA) sat with 75% of the world’s platinum reserves, and platinum catalysts were used in the manufacture of hydrogen fuel cells.  Cabinet had approved a 15-year research and development (R&D) programme. The intention was to capture 25% of the world’s market.  SA was to become a global player and leader in hydrogen fuel technology based on SA’s natural resources. To reach the goal of 25%, SA needed strategic partners from overseas. HySA had three Centres of Competence (COCs) -- HySA Infrastructure based at North West University, in collaboration with the Council for Scientific and Industrial Research (CSIR); HySA Catalysis based at the University of Cape Town, collaborating with MINTEK; and HySA Systems based at the University of the Western Cape.  Specifics on the three COCs were given to the Committee.
 
The Committee was given insight into the R&D programme formulation. There was firstly the submission of 15-year business plans by the COCs, which were reviewed by three panels of experts.  An international study tour had been undertaken to identify gaps and opportunities. This was followed a by a reformulation of the 15-year business plan and a second review. Thereafter there was the approval of the business plan and initiation of R&D work.  There were five HySA R&D programmes: Programme 1 -- Combined Heat and Power; Programme 2 -- Portable Power Systems; Programme 3 -- Hydrogen Fuelled Vehicles; Programme 4 -- Hydrogen Filling Stations; and lastly Programme 5 --  Renewable Hydrogen Production.

The role of private sector partners was also emphasised. Some of the partners included Anglo-Platinum and PetroSA, which provided R&D funding; Impala Platinum provided core funding for projects; Hot Platinum worked with HySA Systems on intellectual property contract research; and TF Design assisted with designing prototypes at HySA Systems.  An international partner network had been established with partners in the UK, Germany, Switzerland, USA, South Africa and China. On governance and management there was a government substructure which comprised an advisory board, a programme office and an inter-governmental committee and other committees. There was also an R&D sub-structure made up of the three COCs and third party partners from both private sector and academia. Lastly there was a commercialisation substructure, which was made up of public-private partnerships considered to be the nucleus of the hydrogen fuel cell technology in SA.

Members were provided with a schematic of the public-private interaction.  Measurement of the success of the HySA Programme could be through business creation, perhaps in the form of jobs created, human capital development in terms of graduates in the field, industry participation and lastly knowledge creation.  Some of the advantages of the programme were to ensure a paradigm shift in academia, a transition from only teaching to product development, as well as ensuring economic growth through the commercialisation of intellectual property generated by the COCs.   

Achievements to date were also highlighted. A total of 13 individuals had graduated in the field in 2011. Eleven had completed their Masters degrees, with a further two obtaining their PhDs.  Other achievements had been the first demonstration of a fuel cell-powered tricycle in SA and the first metal hydride hydrogen storage unit fuel-based forklift truck in SA.  A key milestone had been the first internationally competitive fuel cell catalyst at a commercially relevant scale.

Discussion
Mr P Smith (IFP) was excited by the project but asked what the 25% target was that had been spoken about. Was it 25% of the hydrogen vehicle or fuel systems market, or of each of the five programmes referred to? To reach the target by 2020 -- was it realistic?  He asked whether the research on exhaust catalysts was a threat to SA.  It was felt the amount of R6m donated by Anglo-Platinum towards the project was small. Did the Department request the amount or was it volunteered by Anglo-Platinum?  Was Anglo-Platinum conducting its own research on the issue? He felt it wise of the Department to partner up with international partners who could have been potential competitors. What was the model envisaged for the public-private partnerships (PPP)? The project was currently at the product development phase -- would the commercialisation model be ready by the time the product was ready? He asked for figures on the numbers of jobs to be created. He asked whether the technology could supply heat as well as power.

Dr Sita said that the idea was to capture catalyst demand by 2020. However the catalyst by itself would not be able to capture 25% of the market. Hence the briefing spoke to the components that incorporated the catalyst. On the feasibility of having 2020 as the target, the programme was presently due for a review and the 2020 target date would be reconsidered if need be. A review was done every five years. She confirmed that the world was looking for alternatives to platinum group metals, but to date no alternatives had been found.

Local partners to HySA were Anglo-Platinum and Impala-Platinum mining companies. Their core business was mining and to ensure buyers for their product, which was platinum. Their investment in HySA was more about beneficiation. It was hoped that their investments in HySA would grow as HySA grew.

Regarding a model for PPP, she noted that R&D capabilities already existed. The minute the private sector had been taken onboard, they had seen the value in the R&D that had been done.  There were a number of private sector companies on board.  She noted that COCs were hosted by universities. The eventual aim was to have HySA privatised, as had been done with SASOL.

On the issue of heat and power applications, Japan used micro-grids. In SA, 30% of the population was not connected to the electricity grid.  It would be best in the near future for SA to go the route of micro-grids, which had a 5-10kw fuel system. With high temperature fuel cells, heat and electricity could be created.  She pointed out that it was a billion dollar market. The Department was considering niche applications. Currently the market was using hydrogen cell technology in utility vehicles like forklifts and golf carts.

Referring to the potential of creating jobs, she said that students studied at COCs at universities. Students were being capacitated whilst R&D was taking place.  Of the 13 students who had graduated, two PhD students had graduated from the University of the Western Cape and had been in the placed in the HySA Programme. There were also Masters students who had enrolled for the PhD HySA Programme.

Dr Munsami agreed that to solve the electricity problems in SA, an alternative was the earlier-mentioned micro-grid or hydrogen fuel cells.

Ms P Mocumi (ANC) noted that the briefing alluded to the successes of the project -- but what about the threats and challenges? She referred to slides 19 and 22 of the briefing document and noted that if government was to appoint a board and subcommittee, when was it to happen? The Committee needed timeframes.

Dr Sita stated that a challenge was perhaps that the investment which SA had made in HySA was minimal compared to investments by developed countries. In as far as grabbing niche opportunities was concerned, HySA hoped to piggyback on the efforts of international partners. Another challenge was not being able to attract the R&D capabilities to drive research efforts. The three COCs were not at the same level.

The Department had followed normal processes by placing advertisements for appointments to the advisory board.  A programme office would be established once an advisory board was in place.  

Ms S Plaatjie (COPE, Northern Cape) referred to the tricycle powered by hydrogen cells in the briefing, and asked where it was at present.  What was the way forward on the manufacture of tricycles of this kind? She referred to slide 15 of the briefing document, and asked to whom skills and knowledge were being transferred.

The Chairperson also showed interest in the tricycle project.

Dr Sita answered that the tricycle was located at present at UWC. It had been developed through collaboration between UWC and the Tshwane University of Technology, but had not been developed with the aim of commercial sales. The intention was to demonstrate hydrogen fuel cell technology.  As stated earlier, stored hydrogen cell technology had seen use in utility vehicles such as forklifts.  Hydrogen cell technology was new to SA. The aim was to bring technology providers on board and to take HySA to the rest of Africa.

Ms J Lourens-Kloppers (DA) referred to slide 8, and asked who had gone on the international study trip. What gaps and opportunities had been identified?  Was there a report on the international trip?
Slide 15 referred to staff exchange programmes, and she asked for particulars on who, how and when exchanges had been made. She also referred to page 26, and asked Dr Sita to explain the slide referring to Masters and Doctoral students. She felt the figures for graduates were not impressive.

Dr Sita responded that the international study trip had been undertaken to scope R&D programmes. Even though the technology was old, it still had challenges.  HySA intended to fill gaps in identified opportunities. There was a report on the international trip.  The Department was still trying to develop HySA’s human capital. The COCs had agreements with academia internationally. Student exchanges were taking place.  She explained that postgraduate students had to work on the HySA programme. The programme had started only in 2009 and was still new. There was no undergraduate HySA Programme as yet, but it was being considered.  It was not easy to attract students to study at HySA, hence awareness programmes had been launched at schools.
 
Dr Munsami added that it took two years to complete a Masters degree and four years to complete a PhD. He explained that the technology was new and that human capital development was done on the side. Given time, human capital development would grow.

The Chairperson pointed out that human capital could not be generated unless there was work for graduates.  He felt that HySA’s list of departments on the intergovernmental committee was incomplete. The Departments of Environmental Affairs, Economic Development, Public Enterprises were not on the list.  The problem with hydrogen fuel technology was that it was expensive. In 2006 he had visited Sweden, and a project using the technology in public buses had been abandoned owing to it not being viable.  SA was in the process of developing nuclear power stations -- was HySA tapping into hydrogen generation for energy.

Dr Sita stated that the names on the list of departments on the intergovernmental committee were not limited to those listed in the briefing document. She was aware that hydrogen as a fuel was expensive. It was, however, a clean fuel. She added that bringing down the price of platinum would bring down the price of the catalyst.

Regarding the use of nuclear technology for the generation of hydrogen, the Department would speak to the Department of Energy about the use of excessive heat given off by nuclear plants for the generation of hydrogen.

Dr Munsami pointed out that SA had 74% of the world’s platinum reserves.  International partners scrambled to SA. The price of platinum had recently been volatile, in that it had fallen below the price of gold. To relieve the pressure, the value of the HySA Programme was important. Hence mining companies saw it as a long-term investment opportunity.  

The Chairperson urged the presenters to speak to the Department of Energy as soon as possible, as two nuclear power plants were to be built in 2013. A total of six nuclear power plants were to be built. Not all nuclear power plants could generate hydrogen. The initial design of the nuclear power plant had to include hydrogen production as one of its functions. 

The Chairperson noted that fuel cell technology was an old technology. He asked what strategy the Department had in place to use the programme for capacitating the South African National Space Agency (SANSA).  On human capital development, 13 people had graduated in 2011 -- where they were now?  Was there an undergraduate study programme as well?

Dr Sita replied on the issue of SANSA, and said that hydrogen fuel cells were considered as an option. Not only was communication taking place with SANSA, but the technology was also being used on the Square Kilometre Array (SKA) Radio Telescope. 

Dr Munsami added that during the day, sunlight was used to power the SKA, but at night hydrogen fuel cells were used.

Mr Smith asked whether the Department had done a job creation benefit analysis.  He once again felt that there was low level of investment by Anglo-Platinum in HySA.  Anglo-Platinum had unveiled a hydrogen fuel cell-powered locomotive and no mention had been made of HySA.  Did Anglo-Platinum have parallel hydrogen cell R&D projects? How did HySA share its intellectual property with its international partners? Since SA sat with almost 75% of the world’s platinum reserves, what was SA’s competitive advantage to obtain 25% of the world market?

Dr Sita noted that while the Department was engaged in R&D, the mining houses were looking for buyers for their products. The locomotive was a good example of hydrogen power. There was thus parallel R&D being carried out.  She explained that intellectual property would be divided in terms of the IPR8. The intellectual property issue had been resolved upfront.   Having 75% of the world’s platinum reserves was not good enough -- adding value created a competitive advantage. The R&D programmes of HySA were structured to take advantage of the gaps and opportunities in the market. No one else was doing it.

Dr Munsami, referring to commercialisation, noted that products were single units. For commercialisation to take place, economies of scale were needed. The Department had looked at other countries to learn and discuss the issue. There was a commercialisation model.

Mr Swart asked whether hydrogen filling stations were selling hydrogen fuel or fuel cells.

Dr Sita responded that it was fuel cells, and not combustible hydrogen fuel.

Dr Munsami stated that the Chinese had hydrogen fuel cell vehicles, but there were challenges attached to it. Hydrogen fuel cells extended the range of vehicles.

The meeting was adjourned.