 This is Think Tech Hawaii, Community Matters here. Hey Aloha and welcome to Stand on Energy Man on Think Tech Hawaii where community matters and I'm really really excited for our last show of 2017. 2017 has been a jam packed year, you've heard me mention this a couple times, I have no idea where this year went but it's in our rear view mirror as of this weekend and we're closing out this year with one of the greatest guests I think I could ever expect to have on the show, Mr. Andy Marsh who's the president and CEO of Plug Power and for those who deal with hydrogen they know that Plug Power is definitely a force to be reckoned with in the fuel cell industry and the hydrogen industry and we're really really glad that we could have Mr. Marsh on this morning to discuss the state of the art of hydrogen in the U.S. and around the world so Andy I really really thank you for being on today and I'm looking forward to having a good discussion with you. Well Aloha Stan and happy new year and really looking forward to our discussion today. Great, hey could you start off by telling us the audience a little bit about how you got into doing what you're doing and how you moved into Plug Power and then get us up to date on what Plug Power has been up to. Sure Stan, I've actually been in energy and new technology is my entire career. I started off over 35 years ago with Bell Laboratories and I was working there on powering wireless equipment in the 1980s and broadband equipment in the 90s and after 18 years of the labs I actually started my own company with a few friends which we grew into a hundred million dollar business building power systems for broadband applications in the United States and across the world and the company was sold in 2007 and I was on vacation in the Virgin Islands in 2008 and my phone rang and it was Plug Power and they asked me if I was interested in sitting down and talking to them about the CEO position and after my successful run as CEO at the company I started called Valiar and I've actually been involved and knowledgeable about fuel cells for many years since my father worked for General Electric and worked for fuel cells in the 60s. I understood the possibilities and the challenges in the industry and I was nicely offered the job and I was lucky to be the CEO of Plug Power for almost 10 years now. So when you started at Plug Power, how many employees did they have? Well it's interesting, when I joined Plug we had about one million dollars in product revenue and we actually had about 350 employees and one of the more difficult challenges was that I had to resize the business early to meet the revenue and we became as small as 60 people but today we have over 600 folks and are continuing to grow and many of the people we let go in the early years actually have been back and are significant contributors to the growth of our company today. Well and that's important, that's why I asked the question about number of employees because a lot of times you come into a company and the first thing you got to do is apply some tough leadership love and get the company stable so you can grow it and I knew that was part of what you did at Plug Power to make it what it is today. So how big are you now and give us an idea of the kind of things that you're doing because it's just exciting. I know what you're doing but I think everybody else in the world needs to know what you're doing because it's really cool. Sure so you were talking about the stand making hard decisions and about nine years ago when we looked at the market we were trying to find a sector in which we could see that we could offer customers value and we had some experiments going on putting fuel cells into the forklift trucks. So you know the trucks that we could see that by using fuel cells in forklift trucks we could eliminate a battery changeout process that could take up to 20-25 minutes at many companies these are manufacturing companies for retailers who distribute products. We saw we could improve the performance of a truck where the truck ran 10-12% more productive because of the characteristics of fuel cells. We also have folks eliminate the battery changeout room and folks are pretty excited about eliminating lead acid batteries. We looked at that and we also saw that it was a large market opportunity so there's over 6 million forklift trucks in the world and so you know you started thinking man said hey I can start building a viable business charge a little bit more because there's value being added and drive down the costs of our products. So today we have over 20,000 fuel cells in the field powering forklift trucks at facilities like Amazon and Walmart and BMW. And we also found along the way stand that we just couldn't just provide fuel cells that we also had to build the hydrogen fueling stations. And the company has built over 60 hydrogen fueling systems at distribution centers and manufacturing facilities. We've done well over 10 million hydrogen fueling fuelings and on a daily basis we actually use about 15 tons of hydrogen in our products. We're the largest user of industrial hydrogen for fuel in the world. Yeah I have to admit going on your website it's like you've got the cradle, the grave, in fact we often times give Toyota the credit of wanting to bring the chicken and the egg like they're doing here in Serfco in Hawaii but you brought the chicken, the egg, the chicken feed and everything you got this maintenance package you've got the vehicles themselves or the forklifts themselves and different sizes and to fit the market. But one of the things that I look forward to with your association particularly with Walmart and some of the big box companies I know that run 24-7 that's now starting to build up that infrastructure across the continental US where between you and maybe Tesla one or Tesla trucking you're going to really start that infrastructure across the continental US for hydrogen transportation. Are you seeing that as part of your plan too? You know Stan when we look at what we've done with hydrogen is really just a start and that you know for example as well as with fuel cells and let me take a step back I mean in 2017 we deployed our first fuel cells into delivery vans so we have FedEx trucks which are running on plug power fuel cells today. We have delivery vans in China which are operating on plug power fuel cells today and you mentioned our maintenance package I should mention that for each of the units in the field our units are connected via the internet of things but we actually know in real time the performance of our units and how they're operating for our customers. That being said when we start looking at hydrogen we see a large opportunity not only for hydrogen on the distribution side but hydrogen when it comes to generation so we're in discussions with many of the large industrial gas companies about how plug power can partner with them not only to provide fueling infrastructure but also long term to move into the hydrogen generation business as we represent such a steady consistent load for the large industrial gas companies we're a very attractive partner for the long run. And did I read right on your website that that you can use industrial grade hydrogen in your fuel cells on those forklifts so what's the purity standard that you folks have set that you have to maintain to keep your forklifts running? Well we do you know the fuel cells require 99.9% and there are processes about 65% of the hydrogen we use actually hydrogen that would have just been burned off in the air and that hydrogen comes from often chloralcholide plants where the hydrogen is would just be waste coming out of the process of making plastic and the hydrogen is cleaned up through a purifier and then used in our products. I see okay so you're actually tapping into again a different source of hydrogen that's available where you're at we don't have that luxury here in Hawaii but yeah that's it's actually a very you know when you really think about it's a quite a renewable solution because it allows you know hydrogen that would be wasted and be reused you know in Hawaii obviously you know with all your nice sunshine every day which I wish we were having here in upstate New York that you know certainly solar with electrolysis is I think a long-term solution for hydrogen on the Hawaiian islands. We'd love to have you come out here sometime and give us some good advice on the directions we can take. Are you are you actually in any discussions with the other big box companies like maybe Lowe's and Home Depot and maybe big companies like Safeway or you know nationwide chains Macy's any of those that also fit your model for using your material handling? Sure we we actually have sites with Home Depot and Lowe's today and both of them are really targeted for much broader rollouts than we presently have with them. So we have Home Depot's largest internet site retail site is actually in Troy Ohio and there's about 200 plug power fuel cells providing power to the forklift trucks there as well as the plug power hydrogen station. We have a number of sites with Lowe's also and we'd love to make Safeway a customer. Yeah because they're they're out here too and you know quite remarkably and coincidentally when we started our hydrogen implementation working group out here two years ago right near the top of our list of possible revenue sources was lift trucks and forklifts to move material out here along with fleet vehicles because we thought that the commercial passenger car market was going to take a while to develop so we were looking hard at forklifts and pallet electric pallet jacks and pallet movers here in Hawaii to help us develop our infrastructure and I know you come out here on vacation you think that's a viable model out here in Hawaii because we don't do as much 24-7 as the big Walmart and and Amazon warehouses do where that's where your value proposition really takes off when you're when you're working 24-7 in those forklifts if they're not moving they're not making money you know you think that we can still take advantage of the hydrogen in the material handling world out here in Hawaii and I think then you the answer question I think is yes and I think there's a number of reasons when you think about Hawaii's goal to be renewable by 2045 when you think about using solar electrolysis as a source of hydrogen when you think about coupling not only forklifts but coupling items like delivery vans and even offer on on-road vehicles using hydrogen so that you can spread out the costs of infrastructure across a multitude of devices I think there is a strong value proposition we know in general with fleet vehicles that when one starts thinking about the cost of electrical infrastructure when one moves past about 30 units fuel cells make a great deal more sense than lithium batteries today and maybe on the second half of the discussion here we can talk about some of the activities that are going on globally okay that would be great in fact that's a good spot for us to take a quick break here and we'll we'll be back in 60 seconds to spend more time with Andy Marsh and talk about plug power and fuel cells across the globe hi guys it's RV Kelly I'm your host of out of the comfort zone where I find cool people with cool solutions to problems that all of us face now the thing is we're really cool and I only invite really cool people but the thing is I think you're kind of cool too so I think you should come and watch that Thursdays at 11 a.m. here on OC 16 television with think tech Hawaii I'm RB Kelly hosted out of the comfort zone and I will see you next Thursday I just walk by and I said what's happening guys hey and welcome back to stand energy man on my lunch hour Stan Oserman here with Andy Marsh the president CEO of plug power for those of you that aren't familiar plug power it's a big big company now in the world it makes probably the most fuel cells especially the smaller scale fuel cells and I say that relative to 150 kilowatt but forklift and truck size fuel cells probably the biggest in the world if not at least the biggest in the US for sure and we're excited to have them on and talking about the future of hydrogen some fuel cells and hydrogen technology across the globe because he's plugged into the newly minted hydrogen council which is an international consortium of investors and manufacturers that have anything to do with hydrogen some of the names in this consortium include shell oil and total oil air lequid air gas plug power proton on site there's Kawasaki Honda Toyota they're all in this group and and they're all taken off and they've decided that it's time to let hydrogen see its day and make it into the sunshine and and get on everybody's on everybody's radar so welcome back Andy and let's let's head down that that road you were in bond for the last cop cop 23 with members of the hydrogen council and all the events going on in bond that week could you give us some insight as to some of the discussions over there you know I think the big event when it comes to hydrogen was that McKinsey the hydrogen council asked McKinsey back in January where the council was formed at Davos to do a study on the industry to understand how it will grow in the coming years and when they looked at the hydrogen industry and the value that fuel cells and hydrogen could provide society so they came to the conclusion that the industry will be a 2.5 trillion dollar industry by 2050 that will be high will have about 250 million people working in this industry 250 million people working in this industry that I'm confusing my numbers here stand there'll be 250 billion but there'll be about 250,000 people working in this industry you know they see that the investment in the industry between now and 2030 of over 250 billion dollars I think what's really interesting is that they see 18% of the energy in the world coming from hydrogen by 2050 and really being significant even by 2030 and hydrogen will be used as an energy source not only in the transportation sector but also in power generation in industrial uses for refining steel so you know it's not just fuel cells and you know the reason these companies and certainly they all are concerned about the environment but they see a huge massive market opportunity because of the advantages hydrogen has versus batteries in many cases so when you think about the transportation sector for example batteries have some unique advantages if you think about lithium batteries oh their efficiency is 80% but they do have one big challenge and that's charging infrastructure and as I mentioned in the first part of our segment that when you think about over 30 vehicles electrical infrastructure starts becoming more complicated and more costly than fuel cells transportation with fuel cells you have the experience of fast fueling that you have with autos today I think most important why it's important both for power generation and transportation the density of hydrogen at pressures is about 10 to 15 times more than batteries but when you think about transportation from cars the drones the lightweight of fuel cells versus batteries there is a real distinctive advantage and that's why McKinsey decided that this segment was going to grow rapidly and I think you're beginning to see the needs of that around the world now there's 3,000 cars on the road in California today by Toyota there's you know the Olympics in 2018 coming up fuel cells will be highlighted both in the 2018 Olympics in Seoul but also in Japan in the 2020 Olympics so there is a real global push for fuel cells that the hydrogen council and members are significantly behind but it's really fundamentally it adds value to consumers and will help make for a greener cleaner world than we have today yeah I got to admit when I was in New York and listening to all the presentations that you and other corporate leaders and that was actually an eye-opener by itself the folks that were at the hydrogen council meeting and pitching to the investors were not vice presidents or you know someone that works in the company these were all the CEOs of some really large companies that that work the hydrogen industry and to hear them talk about not just their products or what they make but the diversity and the common sense approach to how hydrogen will will solve a lot of problems not just the carbon emission problems but can be leveraged into new tech new new energy sources new materials new processes for making you know materials like steel as you mentioned and it's kind of like the Swiss Army knife of energy you can store the energy you can use to cook with it it's available all over unlike lithium which has a fairly limited you know resource on our planet and we it's like we're going right from one fossil fuel with limited resources around the world to you know lithium was is another limited resource that now we're gonna have to look at as a strategic reserve and especially when you try and scale up the transportation sector it can't be the answer to everybody's questions but batteries are always going to be a part of our fuel cell vehicles and your and forklifts and things but it was just refreshing to hear the industry across the board talk about the diversity of the hydrogen economy and the ways that it's going to contribute in the future the stability it'll bring to you're not fighting over oil you don't have to fight over hydrogen everybody's got it it's in their backyard it's in their landfills it's in everything they have around them it was just great to be part of those discussions and listen to folks talk about it I agree Stan and you know and we were talking about fuel cells and the environment but there is a fundamental value of electric vehicles which can either be powered by fuel cells or lithium batteries when you think about the electrification of the world you know it you know electric vehicles whether it's you know 30 years from now electric airplanes or electric cars electric vehicles are fundamentally more reliable more dependable than internal combustion engines it actually opens up whole new markets for people beyond the big auto companies today and I think you know when you think about mega trends that are going on in the world from the creation of mega cities to a sharing economy for automobiles cars will be on the road 18 hours a day be at Hawaii or be in New York City or be at Honolulu or be in New York City when you think about Lyft or Uber providing people services and fuel cells and they're fast fueling and utilizing the assets like we do in forklift trucks really become very very valuable for society in general beyond a clean environment exactly there's there's companies out there now they're looking at merging the Uber and Lyft concept with the fact that you have autonomous vehicles and instead of a car sitting around in your carport or your garage for you know most of its lifetime these vehicles are going to be on the road you know 24 hours a day with no driver inside and you're going to be maximizing the use of those vehicles and you can make an electric vehicle that maintenance goes down make it a hydrogen electric vehicle and your weight goes down so let's wear and tear on the roads and the tires and you just start to see all the benefits of it and I think hydrogen is one of those things where when you open that Christmas present it's going to just start really showing you what you can do when you open that package it's going to say hey we can provide medical oxygen for the hospitals we can provide you know this industry this product and you know the fertilizer industry this product and we can work with these guys and do this cheaper it's it's just going to be a huge gift once people recognize the value of hydrogen you know Stan I agree a hundred percent and boy I wish I was 30 years old instead of 60 years old because I would love to do this another 40 40 years because I really think this is like when I was a kid and working wireless this is going to take over the world one day and it is a really exciting time and when you mentioned about autonomous vehicles fuel cells beat batteries hands down because we can refuel in minutes versus how long does it take to charge a battery you can get more of your asset using a fuel cell then you can never get out of battery not that there isn't a place for batteries but there's a big place in the world for fuel cell vehicles yeah exactly and you know Hawaii was one of the places that pioneered electric vehicles almost 20 years ago in fact the company or the agency I work with started off working with Hyundai and our county transportation sector and the military under DARPA of all things to do electric vehicles and we have had a lot of folks out here working on it and you know when you think about it with that big of a head start we've also found out what some of the limitations are and in our society here we have a lot of structures that are more than 25 or 30 years old and their electric system is not sufficient in like a high-rise apartment building it was built 30 years ago to to provide the power needed for a bunch of electric plug installs unless they upgrade the utility to the building and sometimes that's several hundred thousand dollars for transformers to put in the chargers that you need so we're we're certain that the battery plug-in vehicles are going to play a role in Honolulu but it's it's tough to deal with the infrastructure ish challenges with plug-ins as well and so hydrogen will give us some more electric vehicles on the road and give us a little bit more diversity in how we how we power those things how we store the energy and you know stand before we go here the reasons you mentioned for Honolulu where for high rises is exactly the reason China is making such a big push in the fuel cells the fuel cells are part of the Chinese five-year plan you know the high rises in Shanghai much newer can't handle the electrical infrastructure in China expects to have over 50,000 fuel cell vehicles on the road by 2025 and over a million by 2030 around the world people expect to have over 4,000 hydrogen stations which can support like a gas station you know six to seven hundred cars per day so there is a real bright future for fuel cells and also a real bright future for plug power I'm seeing that too so I can't get ahead of the insider trading laws I guess because I wish I could but it's like now I'm old enough and I have the money but I don't have the years in front of me to do a whole lot of stuff that I'd like to do just like you but yeah I'm so happy you could join us today on the show and obviously I'm gonna have to have you come back at least a couple more times to update us on what's going on with hydrogen council and and what's going on with plug power but thanks so much for being with us today I really appreciate it thank you and I appreciate the opportunity to talk to all my friends in Hawaii all right well holy muckahee ki ho as they say in Hawaii happy new year and we look forward to talking to you in 2018 so so thanks so much and okay and that's going to do it for Stan energy man for 2017 and we're going to sign off here and see you next year and really it's going to be an exciting year in 2018 so thanks to Robert and Cindy here in the studio for helping they'll put everything together and thanks again to Andy Marsh for being on our show Allah