Nikola bags $58.2 million for hydrogen stations to fuel heavy-duty vehicles

Nikola was granted a total of $58.2 million from various regulatory agencies to build a series of hydrogen refueling stations for heavy-duty trucks, the company announced last week.

Nikola Corporation is a designer and manufacturer of heavy-duty commercial battery-electric vehicles (BEV), fuel cell electric vehicles (FCEV), and energy infrastructure solutions. With headquarters and manufacturing facilities in Arizona, the company began serial production of the hydrogen fuel cell electric truck last month. Earlier this year Nikola launched Hyla, a subsidiary with plans to generate 30 metric tons per day at its Phoenix, Ariz. hydrogen hub, with plans to expand to 150 metric tons in further stages. The first phase of construction of the hub is expected to be completed in the second half of 2024, the company reports.

The largest of the grants to Nikola is $41.9 million from the California Transportation Commission, along with California Department of Transportation to build six refueling stations for heavy-duty hydrogen fuel cell trucks in Southern California. In addition, the company received $3.3 million from the California Energy Commission, $1.6 million from the Mobile Source Air Pollution Reduction Review Committee, $7 million from the Sacramento Metropolitan Air Quality Management District and $4.4 million from the South Coast Air Quality Management District.

“Building an integrated, hydrogen ecosystem to support hydrogen fuel cell electric truck deployment and creating a scalable energy business, is a top priority for us,” said Carey Mendes, president of Nikola Energy.

This May, Nikola announced a partnership between its Hyla brand and infrastructure company Voltera, to develop up to 50 hydrogen stations in North America over the next five years. Work has begun on eight initial stations, Nikola announced while reporting its second quarter earnings. The first one, which located in Ontario, California, is scheduled to begin operating at the end of this year. 

Some of the steps that regulators can take to ease the challenges in building out heavy-duty hydrogen refueling networks include implementing voucher-style programs that reduce the incremental cost upfront for end users, and federal funding that flows to states to offer grants, Mendes told pv magazine USA.

Nikola began serial production of its hydrogen fuel cell electric truck on July 31, the company reported in its second quarter earnings, and had at that point received orders for over 200 hydrogen fuel cell electric trucks from 18 customers. It expects to start delivering the trucks in September. 

Hydrogen as a transportation fuel is a relatively nascent market, especially in terms of the market for heavy-duty fuel cell vehicles, like trucks. As of this year, there were 59 retail hydrogen fueling stations in the U.S., largely clustered in California, according to the U.S. Department of Energy. However, only a small number of these are set up to support heavy-duty hydrogen vehicles. The agency anticipates that as more of these vehicles come on to the roads, the country will need to build out much larger stations. 

“The increase in production and distribution of hydrogen for these stations could improve efficiency and utilization of expensive capital equipment leading to lower fuel costs per kilogram, benefiting both heavy- and light-duty customers,” the Department of Energy’s Alternative Fuels Data Center notes. 

Last year, Daimler Truck North America, NextEra Energy Resources and BlackRock Renewable Power announced they had signed a memorandum of understanding to take a closer look at designing, installing and operating a charging network for medium- and heavy-duty battery electric vehicles as well as hydrogen fuel cell vehicles across the nation, with an initial investment of $650 million. The companies planned to initially focus on charging infrastructure for medium- and heavy-duty electric vehicles, and then hydrogen fueling stations.