Presentation by Catherine Dunwoody at f-cell conference on September 30, 2013 with speaker notes on each slide

1. Hydrogen stations: planning and
investment in California
A California Roadmap
Catherine Dunwoody
California Fuel Cell Partnership
September 30, 2013

2. FCEV market launch: 2015-2017
We are preparing for fuel cell
electric vehicle market launch in
California beginning in 2015.
Automakers have made their
announcements and we are
preparing hydrogen stations so their
customers can get fuel as
conveniently as they do today with
gasoline. Fuel cell buses are poised
to enter the commercial market
too, and we are supporting larger
scale deployments to achieve serial
production and reduce costs. Today
I’ll focus on our work to coordinate
rollout of cars and stations.

3. Stations must come first
• 68 stations provide coverage to enable market
launch
» Supports customer convenient fueling in early markets
» Enables travel throughout early market regions and state
For passenger vehicles, the stations must come first. In 2012 CaFCP published A
California Road Map. The roadmap represents the collective thinking and expertise
of CaFCP members, including automakers, government and station providers, and
uses the modeling expertise of our university partners at UC Irvine and UC Davis as
well as NREL. It is the result of over 1 1/2 years of collaborative discussions and
analysis.

4. Building a statewide network
Map of 68 Hydrogen Fueling Stations: Existing, In Development and Needed
Los Angeles Area
Bay Area
The roadmap shows how to build a statewide network of stations that
gives the first FCEV customers in five early market clusters convenient
access to fuel. The cluster locations were determined using a
combination of data sources such as customer
demographics, confidential OEM market assessment, existing
advanced vehicle registrations and distribution of current clean vehicle
rebates. The roadmap also shows stations in popular destination
areas, like Lake Tahoe and Santa Barbara. And it provides connector
stations that enable travel throughout the state.

5. Emeryville
West Sacramento
Cupertino
Foster City
Mountain View
Open
In Development
Funded in 2013
Target areas for
future funding
Northern CA
Public Hydrogen
Stations
August 2013
We have one
station, Emeryville, open in
the San Francisco Bay Area
today. Three additional
stations were funded earlier
this year. Many more are
required to fully build out this
cluster.

6. Burbank
Torrance
Newport Beach
Irvine
Fountain Valley
West LA
Thousand Palms
Harbor City
Beverly Hills
Diamond Bar (upgrade)
Hawthorne
Hermosa Beach
Irvine (upgrade)
Irvine North
San Juan Capistrano
Los Angeles
Santa Monica
West LA
Westwood
Anaheim
Chino
Mission Viejo
Woodland Hills
Open
In Development
Funded in 2013
Targets areas for
future funding
California Fuel Call Partnership
www.cafcp.org/stationmap
Southern CA
Public Hydrogen
Stations
Most of our public stations in California are
located in Southern California, and many more
are in development. You can keep track of our
progress by visiting our station map located on
our website.

7. Working with fuel retailers
NACS Magazine, August 2013
Most hydrogen stations in California are
located at retail fuel stations. These fuel
stations are owned by small- and medium-
sized businesses who have several stations
or who blend and deliver fuel to
independent stations. For the most part,
the big oil companies are out of the retail
business in California. Station owners are
interested in selling new fuels like hydrogen
because gasoline sales are declining due to
more efficient vehicles. They are interested
because it is a potential new market, but
are hesitant because the business model is
different.

8. EIN cash flow model
• Offers a station-level view and allows user to consider multiple scenarios
www.einow.org
To better understand the fuel retailer perspective and to estimate the cost of a 68
station network, we worked with Energy Independence Now to develop a cash flow
model with academic and stakeholder input. Our aim was to view selling hydrogen
fuel in the same way a fuel retailer looks at selling gasoline today. A retailer gets a
loan to install new equipment, and expects to incur negative cash flows for a period
of time until their revenues exceed expenses and they become profitable.

9. EIN cash flow model
• Offers a station-level view and allows user to consider multiple scenarios
www.einow.org
One of the key results is that the break-even point for hydrogen will be much
longer than station owners are willing to tolerate. This is because FCEVs are just
entering the market, yet the stations need to be there even if they are
underutilized in the early years. This is why government incentives are so
important to launch this new market.

10. H2NIP: FCEV deployment scenarios
2010 OEM surveys
From a station owner’s perspective, they see significant uncertainty as to when they can expect full utilization of a
hydrogen station. The period of under utilization will vary greatly depending on how quickly automakers ramp up
FCEV sales, and of course how quickly customers buy cars. The analysis shows that the rate of FCEV market uptake
significantly impacts the ability of a H2 station owner to make a return on their investment.
This scenario is based on a vehicle survey conducted by CaFCP, CARB and CEC in 2010. It is our most recent survey
data.

11. H2NIP: FCEV deployment scenarios
2010 OEM surveys
CARB ZEV likely
compliance
The second scenario is based on the California Air Resources Board’s ZEV regulation in which they project a “likely
compliance scenario that results in approximately 10,500 FCEVs by 2017 and about 100,000 by 2023.

12. H2NIP: FCEV deployment scenarios
2010 OEM surveys
CARB ZEV likely
compliance
¼ ZEV likely complianceThe third scenario is a much slower
rollout that represents a “worst case
scenario” a fuel retailer might include in
their business case analysis. It could
reflect a single, poorly situated station
that customers avoid, or an overall failure
of FCEVs to gain market traction.

13. Hydrogen Network Investment Plan
CaFCP and several members engaged Energy Independence Now to develop
a hydrogen network investment plan that would address fuel retailer and
other market participant concerns and risks. They used this input along with
a H2 NIP model (based on their original cash flow model) to evaluate and
recommend incentives and network strategies to promote successful market
launch and transition to self-sustaining business model
Some of their findings include:
• All market participants (autos, fuel station providers, investors) need to
know the government will sustain investment all the way to and through
market launch, and they need to see a clear plan to implement these
investments (sufficient funding and state plan)
• Investors and station providers need more transparent FCEV projections
(surveys)
• Automakers need to know stations will remain open through market
launch (MAGs)
• Fuel station providers need assurance they can avoid operating losses in
the early years (MAGs)
• Coordination among stakeholders is essential (station data
monitoring, OEM location vetting, partners to help implement)
There are many more analyses and recommendations regarding specific
incentive tools, but this presentation highlights just a few:

14. H2 NIP: Capital cost share essential
Govt.
(65%)
Private
CostShare
Better for
Consumer
Better for
Station
Provider
Core Market, ZEV Likely Compliance, $2m 500kg/day Delivered Gas Station, Built in 2015:
*Market Assurance Grants not includedAppropriate Cost-Share Depends on Many Factors
IRR of a 2015 Core Market: 500-DH2 Station Vehicle Sale:ZEV Likely Compliance
If long term Hydrogen Retail Price
9% $8.00 $8.50 $9.00 $9.50 $10.00 $10.50 $11.00 $11.50 $12.00
$1,000k -2.7% 11.4% 21.0% 28.8% 36.0% 43.0% 49.9% 56.7% 63.4%
$1,100k -3.8% 10.1% 19.5%
26.9% 33.7% 40.2% 46.6% 53.0% 59.1%
$1,200k -4.9% 9.0% 18.0% 25.2% 31.7% 37.8% 43.7% 49.7% 55.5%
$1,300k -5.8% 7.7% 16.7% 23.7% 29.9% 35.6% 41.3% 46.8% 52.4%
$1,400k -6.7% 6.5% 15.5% 22.3% 28.2% 33.8% 39.1% 44.4% 49.6%
$1,500k -7.6% 5.4% 14.3% 21.1% 26.8% 32.1% 37.1% 42.1% 47.1%
$1,600k -8.3% 4.4% 13.3% 19.9% 25.4% 30.6% 35.4% 40.2% 44.9%
$1,700k -9.1% 3.4% 12.3% 18.8% 24.2% 29.2% 33.8% 38.4% 42.8%
$1,800k -9.7% 2.5% 11.4% 17.8% 23.1% 27.9% 32.4% 36.7% 41.0%
$1,900k -10.4% 1.7% 10.4% 16.9% 22.1% 26.7% 31.1% 35.2% 39.3%
$2,000k -11.0% 0.9% 9.5% 15.9% 21.1% 25.6% 29.9% 33.9% 37.8%
$2,100k -11.5% 0.1% 8.6% 15.1% 20.2% 24.6% 28.7% 32.6% 36.4%
$2,200k -12.1% -0.6% 7.7% 14.3% 19.3% 23.6% 27.6% 31.5% 35.1%
$2,300k -12.6% -1.3% 6.9% 13.5% 18.5% 22.7% 26.6% 30.4% 33.9%
$2,400k -13.1% -1.9% 6.2% 12.7% 17.7% 21.9% 25.7% 29.3% 32.8%
CapitalExpenseofStation
Cost share of capital investment is absolutely necessary in early market. Early market stations cannot make money without
this support because early stations are more expensive and they sell less fuel. This output from the H2 NIP model shows
how station capital cost and fuel price impact return on investment for a core market station that receives a 65% cost
share, assuming vehicles roll out according to the ZEV likely compliance scenario. California has offered at least 65% cost
share for its funding opportunities, and this analysis demonstrates it will be important to continue funding at this level to
enable hydrogen sales at a price competitive with gasoline.

15. H2NIP: Important to cover O&M
Public Funds
IRR Capex Grant MAG Grant O&M Grant
No Incentive -7.9% 0 0 0
Capital Grant 9.5% $1,300k - -
Capital Grant + MAG or O&M 12.8% $1,300k $114k -
Private
Total Grant Capex TOTAL COST
- $2,000k $2,000k
$1,300k $700k $2,000k
$1,414k $700k $2,114k
Core market, 500 kg/day station, $2M station (65% cost share), $9/kg H2 ($5.50 wholesale) – $2.18 net margin
ZEV likely compliance (10,500 FCEVs by 2017):
($100,000)
($50,000)
$0
$50,000
$100,000
$150,000
$200,000
$250,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
$peryear Sta on Opera onal Profit (EBITDA),
MAG Payments O&M Support (not MAG)
Debt Payment Opera onal Profit without MAG
Opera onal Profit with MAG/O&M
2015 Core Market: 500-DH2
FCEV market growth is a significant uncertainty for early station providers. If everything goes according to plan, a core
market station may lose money for a couple of years, and an incentive to cover O&M costs during that time is enough
to bump up the returns to an acceptable level.

16. H2NIP: Market assurance grants
Core market, 500 kg/day station, $2M station (65% cost share), $9/kg H2 ($5.50 wholesale) – $2.18 net margin
¼ ZEV Likely Compliance (2,625 FCEVs by 2017):
($150,000)
($100,000)
($50,000)
$0
$50,000
$100,000
$150,000
$200,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
$peryear
Sta on Opera onal Profit (EBITDA),
MAG Payments O&M Support (not MAG)
Debt Payment Opera onal Profit without MAG
Opera onal Profit with MAG/O&M
2015 Core Market: 500-DH2
Public Funds
IRR Capex Grant MAG Grant O&M Grant
No Incentive -16.6% 0 0 0
Capital Grant -7.2% $1,300k - -
Capital Grant + MAG or O&M 0.1% $1,300k $427k -
Private
Total Grant Capex TOTAL COST
- $2,000k $2,000k
$1,300k $700k $2,000k
$1,727k $700k $2,427k
But what if FCEVs come slower than expected, or a particular station location is less attractive to consumers? A market
assurance grant would mitigate this downside risk by assuring station owners they will remain “whole”, although the
payments should always be less than what they would earn by selling fuel. MAGs could be funded by government and
others who want to ensure station operators don’t get discouraged and close stations prematurely.

17. H2NIP: Incentives vary by market
Different types of station markets (core, emerging and connector) require different incentives. A 500 kg/day station in
a core market (one that has lots of FCEV customers in early years) will need less capital cost share and less O&M
support from the MAG fund than a 100 kg/day station in a connector market, such as the I-5 station between
Southern and Northern California. In fact, it may be difficult to obtain proposals for the connector stations and these
may need a different approach.

18. Open Today:
• Burbank
• Emeryville
• Fountain Valley
• Harbor City
• Irvine #1
• Newport Beach
• Thousand Palms
• Torrance
• West LA #1
In Development:
• Beverly Hills
• Diamond Bar
• Hawthorne
• Hermosa Beach
• Irvine #2
• Los Angeles
• San Juan Capistrano
• Santa Monica
• West LA #2
• West Sacramento
• Westwood
• Woodland Hills
• Mountain View
• Mission Viejo
• Cupertino
• Foster City
• Chino
• Anaheim
Hydrogen stations in California
State investment today has brought us to this point. Today
California has a small network of public hydrogen
stations, and since 2010 has invested over $35M with station
developers to expand that network. With investments to
date we can expect between 25-30 public hydrogen stations
in place by 2015. We are almost halfway to our goal.
30, however, is not the 100 that we estimate is necessary to
build the initial network.

19. New California funding for hydrogen
The California legislature recently passed Assembly Bill 8, and Governor Brown has publicly stated he will sign it.
The bill authorizes extensions of existing programs to fund alternative fuels and air quality improvement
programs that support California’s work to achieve clean air, reduce carbon emissions and shift away from
petroleum fuels. One element of the bill allocates up to $20 million per year to fund at least 100 hydrogen
stations. The California Air Resources Board survey’s automakers each year to determine their following 3
model-year projections for FCEVs, and with the California Energy Commission they evaluate progress toward
achieving a network of stations that provides the coverage and capacity to support FCEVs. The bill allows the
State to use innovative financing mechanisms to support the early market and achieve at least 100 stations.
This is a significant commitment from the State of California, integral to achieving the goals set forth by
Governor Brown in his ZEV executive order and action plan.

20. California ZEV Action Plan
• By 2015: California major metropolitan areas “ZEV-
ready” with infrastructure and streamlined permitting
• By 2020: California ZEV infrastructure can support up to
1 million vehicles
» Including widespread use of ZEVs for freight and public transit
• By 2025: Over 1.5 million ZEVs in California
20
Visit www.cafcp.org/toolkits/cities to download the ZEV Action Plan
The ZEV Action Plan calls out specific actions for
hydrogen. Governor Brown’s staff have taken a strong
leadership role to coordinate state agencies and
stakeholders to implement both plug-in and fuel cell
electric vehicles. We are preparing local governments to
deploy infrastructure by providing permit guidance and
support, co-funding investments in
infrastructure, coordinating planning activities and
reaching future customers so that we can grow ZEVs in
the California to exceed 1.5 million in the next 10-12
years.

21. Enabling a successful hydrogen station network will be essential to achieving California’s ZEV goals. Automakers are
producing excellent fuel cell vehicles, and we know customers will embrace FCEVs if they can fuel as conveniently as they do
today. There is a lot of work ahead, and we have the tools in place to make it happen.

22. Members
Air Liquide
Air Products
Alameda-Contra Costa Transit District
(AC Transit)
Automotive Fuel Cell Cooperation
Ballard Power Systems
California Air Resources Board
California Department of Food and
Agriculture
California Energy Commission
California State University-Los Angeles
Center for Energy Efficiency and
Renewable Technologies (CEERT)
Chrysler
Daimler
Energy Independence Now
General Motors
Honda
Hydrogenics
Hyundai
Institute of Transportation Studies, UC Davis
Linde North America, Inc.
National Fuel Cell Research Center, UC Irvine
National Renewable Energy Laboratory
(NREL)
Nissan
Powertech Labs
Proton OnSite
Sandia National Laboratories
South Coast Air Quality Management District
Southern California Gas Company
SunLine Transit Agency
Toyota
U.S. Department of Energy
U.S. Department of Transportation
U.S. Environmental Protection Agency
U.S. Hybrid
Volkswagen
www.cafcp.org