Industrial gas manufacturer Air Liquide is lifting its North American business out of the sluggish economy with the help of heavy machinery and a lighter-than-air element.
The Paris-based global corporation, with 2010 revenue of $18 billion, bases its Americas operations in Houston. It long has supplied the nitrogen, carbon dioxide and other gases needed to preserve food, produce plastic and manufacture everyday products.
Now Air Liquide is betting that one of its newest investments — supplying hydrogen for the nation’s growing fleet of fuel-cell forklifts — will help it grow as domestic manufacturing falters.
Hydrogen-powered industrial equipment is one of several clean energy businesses that Air Liquide has entered recently. Air Liquide is increasingly tying its future to making domestic energy more viable and less polluting.
Air Liquide targeted more than 60 percent of its $305 million in research and
development funding in 2010 to projects focused on energy efficiency, carbon capture, biofuels and other clean
Boosting the company’s innovation efforts was a strategic move coming out of the recession, said Michael Graff, president and CEO of Air Liquide’s Americas arm and one of 1,200 Air Liquide employees in the Houston area.
“We were looking at the more mature economies and wondering, how do we continue to reinvigorate growth?” Graff said. “There are a lot of things we are looking at to determine how we meet the needs of the future. We don’t just think about next year. We think about five years down the road.”
In 2010, the company started supplying hydrogen to Wal-Mart Stores, which opened a distribution center near Calgary, Alberta, with the goal of making the facility 60 percent more energy efficient than its traditional warehouses.
The mega-retailer equipped the supply center with 82 fuel-cell forklifts and called on Air Liquide to provide the hydrogen power and infrastructure to keep the forklifts operating.
That technology has made the distribution center more cost-efficient than others, said Virginia Garbutt, logistics director for Walmart Canada.
“It was a risk going in, because it was a relatively new technology,” Garbutt said. “But we have been absolutely pleased.”
Coca-Cola signed on, too. Air Liquide is slated to supply the beverage company’s San Leandro, Calif., distribution and bottling plant, where 37 forklifts and 19 pallet jacks will start operating on hydrogen fuel-cell technology this year.
It’s an application of industrial gases that Air Liquide hopes to see grow in North America as the company actively pursues contracts with major corporations exploring hydrogen-fuel cell fleets.
Thirty-seven companies operate or have purchased 2,000 fuel-cell forklifts now in the United States and Canada, according
to the nonprofit advocacy group Fuel Cells 2000.
Jennifer Gangi, the group’s program director, said major oil companies including Chevron Corp., BP and Shell got involved early on in providing fueling facilities.
“They put in some stations,” she said. “But it’s really been the industrial
gas companies that have taken the ball and run with it.”
Though the forklifts are more expensive than their battery-powered counterparts, industry followers say they expect demand for the hydrogen technology to grow because of long-term benefits.
These include reduced storage requirements, since backup batteries take up warehouse space, and the shorter time it takes to
fuel a hydrogen cell compared to charging a battery.
“Forklifts are one of the biggest drivers right now of fuel-cell manufacturing and of hydrogen infrastructure installations,” said James Warner, policy director for the Fuel Cell and Hydrogen Energy Association, a Washington-based trade group. “This is a tremendous opportunity because you are not just talking about building and selling the forklifts. These are domestic fuels.”
The solar power industry also is a growing customer for Air Liquide’s move into alternative energy.
It supplies silane and other specialty gases used in manufacturing the semiconductors in solar power cells.
Last month, Air Liquide announced several new contracts to supply gases to solar companies, including San Jose, Calif.-based Stion.
It selected Air Liquide to provide gases for the nascent company’s first solar panel manufacturing facility, in Hattiesburg, Miss.
While Air Liquide’s alternative energy efforts are booming, it has maintained a presence in traditional energy sources, as well, using industrial gases to make them cleaner and more efficient.
Air Liquide supplies oxygen for a coal-burning process that traps and isolates the polluting carbon dioxide that is typically released during combustion, a technology that is attracting more attention in the domestic coal industry.
“For us, the question is, where is the long-term solution? How will our energy needs be met?” Graff said, noting that Air Liquide is funding research projects that might not produce a marketable product for as long as 20 years. “Innovation is at the forefront of enabling greater industrial efficiency, energy security and a better way of life.”