Hydrogen Powered Data Centers

00:00:02 Ivan Buckner
Hello and welcome to Power Bytes. I am your host, Ivan Buckner. Today we're discussing hydrogen-powered data centers. This is a topic driven by you, our listeners. When we asked you what you wanted to hear more of in a recent poll, many of you told us you wanted to know more about hydrogen. So today, as our guest, we have Steven Parente. He's a hydrogen infrastructure and integration specialist at Caterpillar. He's responsible for product strategy, product definition, hydrogen infrastructure, and fuel cell systems. Steven has spent more than 18 years working on hydrogen technologies. He's an expert in hydrogen production, compression, storage, and dispensing. Steven is a registered professional engineer with the bachelor of science and chemical and biomolecular engineering, along with an MBA, both from the Georgia Institute of Technology – yes, he's a Yellow Jacket! Steven, welcome to Power Bytes.

00:00:58 Steven Parente
Hi, Ivan. Thanks for having me today.

00:00:59 Ivan Buckner
We're lucky to have you. Since it's baseball season and football hasn't kicked off yet, I'm going to start you off with a slow pitch right down the middle. Are you surprised that customers are asking to hear more about hydrogen?

00:01:12 Steven Parente
Not really! And I think that's a good thing. A couple of years back, not many customers were asking about hydrogen or even aware of its use in the power industry. But certainly today we're getting more and more questions about hydrogen and the actual opportunities that are coming up and being considered.

00:01:32 Ivan Buckner
So why all the interest lately?

00:01:34 Steven Parente
I think it's a result of the energy transition. Many of the people that we are talking to are at a point of learning and investigating which technologies could have some role to play in the energy mix of the future. People are interested in alternative energy because they are looking for options to deliver reliable power that they need but also being able to reach reduced carbon goals or meet regulatory requirements. And ultimately, I think hydrogen is a great option for achieving all of these goals.

00:02:11 Ivan Buckner
That makes sense. The benefits of using hydrogen in power solutions continues to grow. Tell me, how would you answer the critics out there that are saying that it's all hype or simply, “We're not ready for hydrogen yet”?

00:02:25 Steven Parente
That's a good question – and truthfully it's not easy to answer!

00:02:28 Ivan Buckner
Steven, it's my job to ask those tough questions! And keeping with the baseball metaphor, we're going to call that my slider.

00:02:35 Steven Parente
Okay! Well, when we talk about alternative fuels or alternative energy, there's a growing awareness in the market that there's not a one-size-fits-all solution. And it's the same with hydrogen. It's not going to solve every problem. And hydrogen is certainly not going to be the only option for producing power in the future. I think the skepticism around hydrogen's viability as an alternative fuel comes, in part, from critics who cherry-picked scenarios where, admittedly, hydrogen really doesn't make sense. We do see numerous applications – regions and scenarios – where hydrogen can be used to help reduce carbon. And I expect we will see more and more applications in the coming years.

00:03:22 Ivan Buckner
I get the theory that hydrogen can make sense in a lot of scenarios and applications, like you just said. But are there any actual real-life projects today that are leveraging hydrogen right now?

00:03:35 Steven Parente
Certainly! And I'm glad you asked. I do want to emphasize that there are solutions that are delivering benefits right now. So, the example that comes to mind is a recent project that Caterpillar led in a data center application.

00:03:50 Ivan Buckner
Before you start. I hear the passion in your voice. Why this particular example?

00:03:56 Steven Parente
I like this example because of a few different elements. First, it's an example of a customer needing a fairly large power requirement, but at the same time trying to meet certain sustainability targets. And then of course it involves a first-of-its-kind hydrogen solution – fuel-cell based – within the data center industry.

00:04:23 Ivan Buckner
That sounds good. Tell me a little more about this project.

00:04:26 Steven Parente
Data centers consume huge amounts of power, and they also can't really afford any downtime, due to the guarantees they have with their customers. So, the challenge for every data center is power reliability. And while the grid supplies the power that they need for the vast majority of the time, they need backup power in those rare instances where power from the grid is interrupted. Traditionally, this backup has been provided by a fast-response diesel generator set, but certain data center customers are looking for ways to get the reliable backup power that they need while also lowering their emissions. So, what do you think they do?

00:05:09 Ivan Buckner
Well, I'm going to take a guess. They're looking at alternative solutions and technologies?

00:05:14 Steven Parente
That's exactly right. You got it. So, this particular data center project’s goal was to demonstrate the viability of using large format hydrogen fuel cells to supply reliable and sustainable backup power for data centers. This was really a first-of-its-kind demonstration of a 1.5 MW hydrogen fuel cell that could respond dynamically to support the grid. And I really like to stress that point. The system, as it was designed, could perform beyond what a typical diesel backup solution could do because of its ability to interact with the grid.

00:05:48 Ivan Buckner
Wow. Yeah, that sounds impressive! What types of equipment were used in this project?

00:05:54 Steven Parente
This demonstration used a fuel cell that was supplied by Ballard and was integrated with Cat battery energy storage modules. Those storage modules were there to support the transient performance of the fuel cell. We also employed a Cat microgrid controller to manage the interaction between the batteries, the fuel cell, the data center load, and the grid. Then, the final piece of the puzzle was the hydrogen fuel supply. One of the key project objectives was to prove that this fuel cell system could supply power continuously for 48 hours. And that's a critical requirement for backup power at data centers. So, to achieve that 48-hour continuous runtime, it was clear that a liquid-hydrogen storage system was the most economical option. We used a liquid-hydrogen tank and vaporizers to provide the hydrogen needed to operate the fuel cell. I should mention that Microsoft was our host. All this equipment and this demonstration was conducted at a Microsoft Data Center in Cheyenne, WY.

00:07:02 Ivan Buckner
Man, that sounds next level, right?

00:07:05 Steven Parente
Yeah, it was pretty incredible to see it all come together!

00:07:08 Ivan Buckner
I bet. How did it turn out?

00:07:11 Steven Parente
The project was successful. We successfully simulated a 48-hour backup power event at the data center. The fuel cell system was proven to match or, even in some cases, exceed the transient capability of a diesel generator set. The combination of the fuel cell, the battery storage, and the microgrid controller … we proved that it could support any load step.

00:07:38 Ivan Buckner
It really does sound like a great example of how hydrogen has proven its viability as a fuel and can help customers move forward, especially data centers. But there's still one thing nudging at me that we haven't covered.

00:07:51 Steven Parente
Are you talking about safety?

00:07:53 Ivan Buckner
Are you reading my mind? How did you know?

00:07:56 Steven Parente
It's just because I always get asked about safety when it comes to hydrogen, and there's good reason for that. For Caterpillar, safety is the most important part.

00:08:04 Ivan Buckner
Is hydrogen safe?

00:08:06 Steven Parente
Hydrogen may be new to the power industry, [but] the fact is that hydrogen has been used in industrial processes for several decades, and so there's a body of experience from those industries that confirms hydrogen can be handled and used safely. But certainly, safety is a topic that should be discussed early in the consideration of any hydrogen-related project. Part of our success with this fuel cell project can be attributed to an early and sustained engagement in understanding and addressing the safety risks inherent in hydrogen and in this demonstration site.

00:08:45 Steven Parente
The starting point of any safety analysis is to identify and understand the hazards that are present. The risks of hydrogen are similar to other flammable gases, such as natural gas, which is commonly used in power solutions. But there are differences, as well, between hydrogen and natural gas. So, for example hydrogen has a wider flammability range and it requires less energy to ignite. Also, liquid hydrogen, which we used in this demonstration, is a deep cryogenic and can cause severe burns. So, despite these risks … hydrogen is commonly used in other industrial processes, and so there's a lot of [knowledge] and best practices that we can rely on from the experience of those industries.

00:09:31 Steven Parente
Some examples include regular inspections and leak testing, implementing fault-tolerant safety controls, and using fire and gas detection systems. Those are just to name a few. There's really a lot of detail on the topic of hydrogen safety. We could have a whole podcast on it, but I would encourage our listeners who are evaluating hydrogen opportunities to begin the discussion with their environmental health and safety teams as early as possible.

00:09:59 Ivan Buckner
Well, I’m always looking for more podcast ideas! Steven, I think you've just signed yourself up for our next one. I want to switch gears a little. We focus a lot on this particular fuel cell project because it's a great example of using hydrogen. But outside of that, are there any other hydrogen applications we should know about?

00:10:22 Steven Parente
Certainly! When it comes to hydrogen, this isn't Caterpillar's first rodeo. Caterpillar has more than 35 years of experience with hydrogen fuels across the entire enterprise, and we've supported numerous power generation projects in multiple-end industries involving hydrogen. We currently have a large and growing portfolio of commercially available power solutions that can run on hydrogen. Since 2022, we've offered demonstrator Cat G3516 gas generator set, which has the capability of operating on 100% hydrogen. And then we also have natural gas generator sets from 400 kW up to 4.5 MW that are approved to operate on blends of natural gas and up to 25% hydrogen by volume. These capabilities are available through factory-installed hardware as well as retrofit kits for generator sets that are already in the field.

00:11:21 Ivan Buckner
Man, I'm glad I asked this question! I didn't know about our 100% hydrogen genset offering. Steve, it's been great. I've learned so much about hydrogen – definitely enough to be dangerous.

00:11:35 Steven Parente
Sure! I'm glad I could help.

00:11:37 Ivan Buckner
Do you have any parting thoughts?

00:11:41 Steven Parente
I think I would leave our audience with three key takeaways. The first is that hydrogen is an alternative fuel, which is available today and can help achieve sustainability targets through greenhouse gas reduction. The second is safety. I would advise our audience to bring their safety teams into the early stages of planning if you're considering a hydrogen solution. And third, I would say that generating power from hydrogen is not a far-future technology. The technology and equipment are available today, so talk with your Cat dealer if you're interested in learning more.

00:12:21 Ivan Buckner
Steven, you've summed it up perfectly. That's all the time we have today. I think you've given our listeners plenty to think about. Steven Parente, it was a pleasure. Thank you.

00:12:33 Steven Parente
Thanks again, Ivan.

00:12:34 Ivan Buckner
Please reach out to us via e-mail at powerbytes@cat.com if you have any feedback on today's podcast or ideas for future episodes. And remember to share, follow, or leave us a review if you've enjoyed our discussion today. I’m Ivan Buckner. Thank you so much for listening today. We hope you will join us again on Power Bytes.