Reposting Not Allowed

Kawasaki Heavy Industries
Hydrogen Business Initiatives
and Future Prospects
0Kawasaki Heavy Industries, Ltd.
Hydrogen Strategy Division
Executive Officer
Shigeru Yamamoto

Contents
1. Situation surrounding energy
2. Concept of the hydrogen supply chain
3. Construction of a Japan-Australia hydrogen supply chain
4. Initiatives in the field of hydrogen utilization (1):Hydrogen power generation
5. Initiatives in the field of hydrogen utilization (2):Hydrogen mobility© Kawasaki Heavy Industries, Ltd. All Rights Reserved2

Contents
1. Situation surrounding energy
2. Concept of the hydrogen supply chain
3. Construction of a Japan-Australia hydrogen supply chain
4. Initiatives in the field of hydrogen utilization (1):Hydrogen power generation
5. Initiatives in the field of hydrogen utilization (2):Hydrogen mobility© Kawasaki Heavy Industries, Ltd. All Rights Reserved

3

Contribution of hydrogen energy toeconomic security and domestic industry
Hydrogen can also be produced domestically and also from a wide range ofcountries and resources.
Guraranteeing Japan‘s energy security and stable supply to domestic industries© Kawasaki Heavy Industries, Ltd. All Rights Reserved

4Movement to implement hydrogen society
Japanese Government

2010
2014

Fifth Strategic Energy Plan

*At the time, only Japan formulated a comprehensivehydrogen strategy in the world.

2015

Support from the Japanese andAustralian governments

2018

Basic Hydrogen Strategy andHydrogen Energy Ministerial Meeting

2020

Declaration of Carbon Neutrality
Green Growth Strategy

2021
2022

Private Sectors●Cooperation among privatecompanies

Kawasaki Heavy Industries, Ltd.

●Start hydrogen supply chain research anddevelopment*Tanegashima Island Space Center (JAXA)

Liquefied Hydrogen Tanks proven for over 40 years- HySTRA- Hydrogen Council- Hydrogen Value Chain Promotion Council(JH2A)●Launch pilot demonstration project●First movers

Sixth Basic Energy Plan
Establishment of the Green Innovation FundGreen Economic Transition Bonds and Support System*Compensation for value difference compared to the existing fuels
Accelerated discussion on support for efficient base infrastructure development●Start commercialization demonstration project“Large-Scale Hydrogen Supply Chain Development Project "2023 Revision of Basic Hydrogen Strategy
2030

Start commercial chain operations that benefit the public© Kawasaki Heavy Industries, Ltd. All Rights Reserved

5

Japan government: Basic Hydrogen Strategy
 The world's first Basic Hydrogen Strategy was formulated in 2017 and revised onJune 6, 2023.
 The Hydrogen Industrial Strategy aims to create a society where our country'shydrogen core technology can be used in domestic and international hydrogenbusinesses..
[Key Points of the Basic Hydrogen Strategy Revision]••••

Target for introduction of hydrogen: 3 million tons in 2030, 12 million tons in 2040, and 20 million tons in 2050.
The target for Japanese companies to install electrolyzers in Japan and overseas is set at 15 GW by 2030.
Development of support systems for building supply chains and improving supply infrastructure
G7 agreed on carbon intensity, shift to low-carbon hydrogen, etc.

[Key Points of Hydrogen Industrial Strategy]
In order to "win both in technology and in business," the government will promote mass production andindustrialization at an early stage.
• Japan‘s hydrogen core technology (fuel cells, electrolyzer, power generation, transportation, materials, etc.).
->Support for large-scale investment aimed at decarbonization, stable energy supply, and economic growth.
Supply chain investment plan of 15 trillion yen over 15 years for the public and private sectors•

Source: https://www.cas.go.jp/jp/seisaku/saisei_energy/kaigi_dai4/gijisidai.html© Kawasaki
2016 Kawasaki
Heavy Heavy
Industries,
Industries,
Ltd. AllLtd.
RightsAll Rights
Reserved
Reserved

6

Trend of the global companies:
Hydrogen Council
 Comprised of 150 leading companies in the world, including energy, transportation,
manufacturing, trading companies, and banks(market capitalization is more than 1,100 trillion yen)
 Japanese companies: Toyota, Honda, Kawasaki Heavy IndustriesNote, Iwatani Corporation,
ENEOS, Toyota Tsusho, Mitsubishi Corporation, Mitsui & Co., Marubeni, Sumitomo
Corporation, Mitsubishi Heavy Industries, NGK, SMBC, ITOCHU, Nippon Yusen, Tokyo
Gas ・・・
 Global Initiative to advocate for a joint vision and long-term goals for a hydrogen-based
new energy transition=>January 2022: Chairperson of Kawasaki Heavy
industires, Ltd., Mr. Yoshinori Kanehana, has been
appointed to co-Chair of the Hydrogen Council
 In June 2023, the CEO meeting was held in Japan for the fiest time. (Awaji Island, Hyogo
Prefecture)
Note: Japanese companies among the 13 companies established in 2017 are written in green.
© Kawasaki Heavy Industries, Ltd. All Rights Reserved

7Trend of domestic companies:
Japan Hydrogen Association
Abbreviation: JH2A=Japan Hydrogen Association

PurposeAs a cross-industry, open organization, with a bird's-eye view of the entire supply chain,build a hydrogen society at an early stage by introducing social implementation projects

Main
activities

Generate hydrogen demand, reform laws and regulations, develop standards, and finance

Chairperson

Takeshi, UCHIYAMADA (Toyota Motor Corporation)
Tsuyoshi, KUNIBE (Sumitomo Mitsui Financial Group)
Myoji, MAKINO (Iwatani Corporation)

Vice
Chairperson

13 companies

Iwatani Corporation, INPEX, ENEOS, Obayashi Corporation,
Kawasaki Heavy Industries, Kansai Electric Power, Kobe Steel,
Chiyoda Corporation, Toshiba Corporation, Toyota Motor Corporation,
Panasonic, Sumitomo Mitsui Financial Group, Inc.
Mitsui & Co., Ltd. (As of December 2022)

Number ofmembers

338 companies and organizations (as of December 2022)
Total market capitalization: ¥267 trillion

Board
memberTakeshi SAITO (ENEOS)
Yasuhiko HASHIMOTO (Kawasaki Heavy
Industries)
Yotsuyanagi HATA (Toshiba)
Tatsuo YASUNAGA (Mitsui & Co., Ltd.)

April 2022 Commemorative photo of incorporation© Kawasaki Heavy Industries, Ltd. All Rights Reserved

8

Contents
1. Situation surrounding energy
2. Concept of the hydrogen supply chain
3. Construction of a Japan-Australia hydrogen supply chain
4. Initiatives in the field of hydrogen utilization (1):Hydrogen power generation
5. Initiatives in the field of hydrogen utilization (2):Hydrogen mobility© Kawasaki Heavy Industries, Ltd. All Rights Reserved

9Concept of CO 2 free hydrogen supply chain
Stable supply of energy while reducing CO 2 emissions
Utilization Country(Japan)Resource Countries(Australia, etc.)
Production of hydrogen at low costs
from abundant renewable energy

Process uses
Semiconductor and solar battery
manufacture
Oil refinement, desulfurization,
etc.

Renewable
EnergyTransport equipment

Liquefiedhydrogencontainer

Hydrogen
Production

Liquefaction
Loadingfossil fuelLiquefiedhydrogen Carrier

Clean Hydrogen

CCS(CO2 Capture andStorage)

Production© Kawasaki Heavy Industries, Ltd. All Rights Reserved

Hydrogen stations
Fuel cell vehicles etc.
Distributed power plants
Hydrogen gas turbines
Hydrogen gas engines
Fuel cells etc.

JAXA

liquefiedhydrogenstorage tank

Tr a n s p o r t / S t o r a g e

Electrical power plants
Combined
Cycle power
generators etc.

Utilization
10

Hydrogen-related products
Kawasaki Heavy Industries contributes to decarbonization as the only company inthe world that has the technology for the entire hydrogen supply chain to produce,transport, store, and utilize hydrogen© Kawasaki Heavy Industries, Ltd. All Rights Reserved

11Liquefied hydrogen:
Mass transport of hydrogen Liquefaction at cryogenic temperature (-253°C) ⇒ 1/800 volume compared to gas
 High-performance thermal insulation technology (double-shell vacuum insulation) enables
long-term storage equivalent to LNG.
 Nontoxic, odorless, no greenhouse gas

Kawasaki Heavy Industries know-how andknowledge of cryogenic technology can be utilized!
World's First 1,250 m 3 Liquid Hydrogen Carrier©JAXA
Liquefied Hydrogen Tank
(Tanegashima Space Center)

LNG Technology© Kawasaki Heavy Industries, Ltd. All Rights Reserved

Japan's largest liquefied hydrogen tank
(Kobe Liquefied Hydrogen Loading
Terminal)

Large Liquefied Hydrogen Carrier

Liquefied Hydrogen Technology

12Energy efficiency and cost reduction effects ofliquefied hydrogen
Considering energy losses during carrier conversion and transport, liquefied hydrogen
has energy efficiency advantage for end-use, according to the IEA.

20%down

22%down
14%down

5%down35-36%down

Resource: IEA Global Hydrogen Review 2022
© Kawasaki Heavy Industries, Ltd. All Rights Reserved

13Liquefied hydrogen:
Cost reduction measures
 Liquefied hydrogen: The larger the transport volume, the greater the cost reduction
effect.
 Benefit from liquefied hydrogen imports in a large-scale
carrier reconversion

carrier conversion

MT(Middle Term): 2030
LT (Long Term): 2050 years
Day - Australia

North Africa - Northern Europe

Source: https://www.cceguide.org/wp-content/uploads/2020/08/07-IEA-Cross-cutting.pdf© Kawasaki Heavy Industries, Ltd. All Rights Reserved

14

Contents
1. Situation surrounding energy
2. Concept of the hydrogen supply chain
3. Construction of a Japan-Australia hydrogen supply chain
4. Initiatives in the field of hydrogen utilization (1):Hydrogen power generation
5. Initiatives in the field of hydrogen utilization (2):Hydrogen mobility© Kawasaki Heavy Industries, Ltd. All Rights Reserved

15

※1

Japan-Australia Pilot Project Promoted with Japanese and Australian government, Kobe city, and private sector partners
 Aiming to establish a stable and large-scale hydrogen supply chain system around 2030,
the pilot project demonstrated technology by building a 1/100 scale of commercial
supply chain※2※2

Credit: HySTRA

Credit: HySTRA

Credit: HySTRA

Supported by Australia and Victoria
government

Supported by the Ministry of Economy,
Trade and Industry (METI) and NEDO
【 CO₂-free Hydrogen Energy Supply-chainTechnology Research Association】
Iwatani Industry, Kawasaki Heavy Industries, Shell Japan, Power Development,
Marubeni, ENEOS, KLINE(As of March 2023)【Hydrogen Engineering Australia】
HEA handles contact and coordination
Kawasaki Heavy Industries, Power Development, J-Power Group, Iwatani
Industries, Marubeni, Sumitomo Corporation AGL (Australian Energy Company)(As of March 2023)*1: HESC(=Hydrogen Energy Supply Chain) Project*2: FY 2015 to FY 22: NEDO issue-setting industrial technology development expense subsidy program"Demonstration Project for Building a Large-Scale Maritime Transport Supply Chain for Hydrogen Derived
from Unutilized Brown Coal"© Kawasaki Heavy Industries, Ltd. All Rights Reserved

16

Focus on unused brown coal
What isbrown coal?
 Large quantities of young coal, widely distributed
Brown coal mining site
worldwide

Latrobe Valley

 High water content of 50~60%
 It is difficult to transport because it tends tospontaneously ignite when it dries, therefore, it isused only for local power generation.



There are not overseas transactions,but only mining rights.

Unused resources = ‘low cost' and 'easy
to acquire interests.'

Among many hydrogen production
methods, hydrogen production frombrown coal is one of the mosteconomical method.

© Kawasaki Heavy Industries, Ltd. All Rights Reserved

There is a lignite layer up to the horizon, and one layer up to 250 meters
deep from the ground.
In addition, there is a brown coal layer beneath it (equivalent to 240 years ofJapan's total electricity generation, when all of it is converted to hydrogen).

17

Efforts to reduce CO2 emissions duringhydrogen production
 Combined with carbon capture and storage (CCS), CO2 emissions of hydrogen frombrown coal is as low as hydrogen from domestic renewable energy for filling a FCVwith hydrogen.
 Blue hydrogen, which can be supplied in large quantities stably and increased
production, is particularly important during the energy transition period.

Domestic wind power (compressed hydrogen)

Green

Domestic wind power (liquefied hydrogen)

Domestic solar power (compressed hydrogen)Produce
Transport/
Storage
Filling

Domestic solar power (liquefied hydrogen)Blue

Overseas’ brown coal reforming (CCS, LH2)
Greenhouse gas per 1Nm³ hydrogen

Source*, a document of Mizuho Information & Research Institute Co., Ltd.
*Assessment Report on Greenhouse Gas Emissions of Hydrogen Considering Life Cycle (Summary Version) (December 2016)© Kawasaki Heavy Industries, Ltd. All Rights Reserved

18Liquefied hydrogen carrier “Suiso Frontier”

Length

116m

Speed

13knot

Width

19m

Cargo

1,250m3

Crew

25person

Propulsion■Awards- Japan Industrial Technology Award (sponsored by Nikkan Kogyo
Shimbun) Prime Minister's Award- The 19th Stainless Steel Association Award- Japan Society of Marine Engineers Ship of the Year 2021
■Visits
G7 Sapporo Climate, Energy and Environment Ministers Meeting
Boarding at the G7 Hiroshima Summit

Diesel Electric*1 knot =1 nautical mile/hour =1.852 km/hour

Liquefied hydrogen tank (1,250m3)
Special dome structure for vacuum
holding
Stainless steel vacuum insulated
double shellHigh thermal insulation
support structure© Kawasaki Heavy Industries, Ltd. All Rights Reserved

Credit: HySTRA

19

Building the world's firstinternational supply chain using liquefied hydrogen The world's first demonstration of hydrogen transport and cargo handling byliquefied hydrogen carrierFirst voyage from Japan to Australia 2021/12/24"Suiso Frontier" Australia arrival ceremony 2022/1/21

Credit: HySTRA

Japan-Australia Pilot Project Completed (2022/4/9)

Kyumen Kobe
Mayor

Governor of
Hyogo
Prefecture,
Saito

President of NEDO
Ishizuka

At the ceremony to complete thedemonstration of the Japan-Australiahydrogen supply chain

Prime Minister
KishidaPrime Minister Kishida attended themeeting.

Provided by

HySTRA
Supported by NEDO's"Demonstration Project for Construction of a Large-Scale Maritime Transport Supply Chain for Hydrogen Derived from Unutilized Brown Coal"© Kawasaki Heavy Industries, Ltd. All Rights Reserved20Liquefied hydrogen carrier unveiled at G7 summit
 The world‘s first liquefied hydrogen carrier, “Suiso Frontier" was unveiled at the G7 meeting. There
was also much attention from ministers around the world.
(April 2023 G7 Climate, Energy and Environment Ministers Meeting in Sapporo & May 19 G7 in Hiroshima Itsukaichi Port)■The joint statement included the following passage:"Strengthen efforts to develop rule-based and transparent global supply chains in a variety of ways, includingliquefied hydrogen and liquid organic hydrogen carriers, and to promote organic cooperation between suppliers andconsumers to reduce costs. We will disseminate relevant regulations, safety codes and standards and create an environment
to promote the safe use of hydrogen in order to promote the hydrogen utilization and accelerate the reduction of emissions."

G7 Climate, Energy and Environment Ministers Meeting in Sapporo

G7 Hiroshima Summit

Visitors: U.S. Secretary of Energy Granholm, European Commissioner for Energy Simson,
British Minister for Energy Security and Net Zero Shapps© Kawasaki Heavy Industries, Ltd. All Rights Reserved

Visitor: Prime Minister Pham Minh Chin of Vietnamz21Green Innovation Fund Project
Large-scale demonstration of liquefied hydrogen supply chain
Adopted as a Green Innovation Fund project for commercial supply chain construction in 2030.
Began a commercialization demonstration project which implements technology forenlargement.

Japan-Australia pilot
demonstration carrier

Approx.
130 times

commercial LH2 carrier
Source: NEDOHP https://www.nedo.go.jp/content/100936315.pdf© Kawasaki Heavy Industries, Ltd. All Rights Reserved

22Shipping and receiving locations forcommercialization demonstration
 Building a supply chain which connects the Port of Hastings in Australia with
the Kawasaki coastal area in Kanagawa Prefecture.
 In March 2023, the Australian Green Innovation Fund project developed acommercialization demonstration and concluded a memorandum of cooperation toagree to develop an international liquefied hydrogen supply chain between
Japan and Australia.

(Witnesses)
Minister of Economy, Trade and Industry Yasutoshi Nishimura,President of NEDO Hiroaki Ishizuka
McAllister, Assistant Minister for Climate Change and Energy,
Australia;
H.E. Mr. Hayhurst, Ambassador of Australia to Japan,(Signed) Paras Minister of Finance Government of Victoria, Australia
Source: https://www.khi.co.jp/pressrelease/news_230308-2.pdf© Kawasaki Heavy Industries, Ltd. All Rights Reserved

23

Contribution to the reduction of CO2 emissions during
the transport of liquefied hydrogen by sea
Liquefied hydrogen can be used as propulsion fuel for liquefied hydrogen carriers byreusing hydrogen from boil-off gas (BOG) during transportation, and contributing to CO2zero emissions during maritime transportation.
Marine propulsion[Comparison of CO2 Emissions during Maritime Transport in IEA Report]

current LNG
ship

Hydrogen propulsion system using BOG
Boiler Turbine to Gas Engine

BOG: B oil O ff G as Gas vaporized by external heat input© Kawasaki Heavy Industries, Ltd. All Rights Reserved

Source: Towards hydrogen definitions based on their emissions intensity by IEA

24

24

Development of hydrogen projects forcommercialization
Demonstrated feasibility of hydrogen production frombrown coal and long-distance maritime transportation(About 1/100 of the commercial level)

2021
Pilot Demonstration

HySTRA

Hydrogen CIF cost
Approx. 170 yen/Nm 3

1,250m3

Proven for 40 years

Spherical tank: 2,500 m 3*Equivalent to about 5,000 households' power consumption

Determine the feasibility of commercialization,
including economic efficiency, by setting the sizeof equipment to commercial scale(One step away from commercialization)~2030
Commercialization
Demonstration
160,000 m 3

advantageous for scale-up

Cylindrical tank: 50,000 m 3

From 2031

Profitable business which
economically independent frominstallation to operation

Commercialization
Hydrogen CIFcost

Approx. 30 yen/Nm 3*cost of shipboard delivery© Kawasaki Heavy Industries, Ltd. All Rights Reserved

160,000 m 3 x 2 carriers*Equivalent to approx. 400,000
households' power consumption

Cylindrical tank: 50,000 m 3 x 4 (plan)z

25

Contents
1. Situation surrounding energy
2. Concept of the hydrogen supply chain
3. Construction of a Japan-Australia hydrogen supply chain
4. Initiatives in the field of hydrogen utilization (1):Hydrogen power generation
5. Initiatives in the field of hydrogen utilization (2):Hydrogen mobility© Kawasaki Heavy Industries, Ltd. All Rights Reservedz26

Transition of gas turbine power generation tohydrogen energy The combined heat and power supply by 100% hydrogen combustion in gas turbines
in city area=>First time in the world!
 The gas turbine can be partially refurbished (combustor), and the combustor canoperate hydrogen and natural gas in a freely mixed ratio.

Hydrogen Mixed Burning 0%~100% (Exclusive Burning)
Replace only the combustor (nozzle)
The cost of refurbishment is
the overall cost of the gas turbine

Approx.

10%

Exclusive hydrogen firing

Carbon-free electricity© Kawasaki Heavy Industries, Ltd. All Rights Reserved27World's first hydrogen power generation in city area
April 2018: Achieved the world's first combined heat and power supply in city area with
100% hydrogen(Conducted in Kobe City, Kansai Electric Power, Kawasaki Heavy Industries, Obayashi Corp., Iwatani Corp.,
Osaka University and Kansai University)

Supply heat and power
generated by hydrogen to
nearby four public facilities

Sanyo Shinkansen ShinKobe Station

Port Island, Kobe

©google Maps

2021: Received the Japan Combustion Society
Technical Award

NEDO Grants for Fiscal 2015 – 2022
Smart Community Technology Development Project Utilizing
Hydrogen CGS and Others© Kawasaki Heavy Industries, Ltd. All Rights Reserved28

Much attention on our gas turbines German power company RWE plans to start operation, 100% hydrogen power
generating demonstration, in 2025.
 Received order for hydrogen gas turbine from Chevron Phillips Chemical International
N.V. From (Belgium) Dozens of hydrogen power generation inquiries to Kawasaki from around the world

1MW×2
7MW×2

RWE:30MW×1

1MW×2
5MW×1
7MW×3

Chevron :1MW×1
5MW×1
7MW×1
20MW×11MW×3
1MW×330MW×27MW×2© Kawasaki Heavy Industries, Ltd. All Rights Reserved

29

Contents
1. Situation surrounding energy
2. Concept of the hydrogen supply chain
3. Construction of a Japan-Australia hydrogen supply chain
4. Initiatives in the field of hydrogen utilization (1):Hydrogen power generation
5. Initiatives in the field of hydrogen utilization (2):Hydrogen mobility© Kawasaki Heavy Industries, Ltd. All Rights Reserved30

Hydrogen mobility engines Zero-emission mobility offers options based on purpose, range, etc.
 Established a technical research association for basic research on hydrogen engines
Motorcy-cle

Four wheel
Large

Construction/
Agriculture

Bus
Bus
Small bus
Car

Small

Ship

Aviation

Large
ship

Large aircraft

Locomotive

Trailer

MiddleRolling
stock

Small truck

Sightseeing boat
Wheel loader(middle)RailcarHydraulicexcavator

Small ship

Small car
Motorcycle

Small hydraulic excavator

Small fishing
boat

Small
aircraftDrone

Forklift© Kawasaki Heavy Industries, Ltd. All Rights Reserved

31

Development of hydrogen fuel in the marine andaviation sectors
Know-how to burn hydrogen safely and cleanly
Further pursuing Kawasaki's combustion technology, leading the world in
mobility internal combustion engines
Related markets worth trillion Yen by 2050

Development of hydrogen fuel ship
propulsion system * 1

Core technology development forhydrogen aircraft * 2Complete a compatible lineup
by around 2026

Promote development looking
toward future hydrogen aircraft
after around 2035.

*1. NEDO Green Innovation Fund Project "Development of Hydrogen Fuel Ship Propulsion System" (about 21.9 billion yen in subsidies)(Yanmar Power Technology adopted in consortium with Japan Engine Corporation)*2. NEDO Green Innovation Fund Project "Core Technology Development for Hydrogen Aircraft" (approximately 18 billion yen in subsidies)© Kawasaki Heavy Industries, Ltd. All Rights Reserved32© Kawasaki Heavy Industries, Ltd. All Rights Reserved33© Kawasaki Heavy Industries, Ltd. All Rights Reserved34