Amplats eyes fuel cells to spark demand
WITH platinum prices at a fiveyear low, Anglo American Platinum (Amplats) is seeking to boost demand for the precious metal with systems that produce electricity in remote areas.
Platinum has a unique ability to react with hydrogen, making it an efficient catalyst for fuel cells. Anglo American and Canada’s Ballard Power Systems are testing the process to see if it can be used to light up an isolated village.
The test in South Africa may lead to wider use of fuel cells as a source of power in developing regions. More than 1.3 billion people worldwide live without electricity, and almost half are in sub-Saharan Africa, according to the International Energy Agency.
“If you’re looking for reasons to be positive about platinum, then the uptake in demand for fuel cells is definitely something to be shouting about,” Michael Kavanagh at Noah Capital Markets said.
Naledi Trust, about 200km south of Johannesburg, lacked electricity for at least five years, until Anglo American and Ballard completed the system in July.
The fuel cells had about 15 kilowatts of capacity, said Kleantha Pillay, the head of market development at Amplats. The test will run for at least a year. “We’ve never trialled a fuel-cell mini-grid,” Pillay said.
The Naledi Trust system runs on methanol. Hydrogen is extracted from the fuel and fed through a membrane. That produces electricity through a chemical reaction that uses platinum as a catalyst.
The fuel cells use about 0.09 ounces to 0.11 ounces of platinum for every kilowatt of generating capacity, so the system that powers lights and refrigerators in the village has about 1.59 ounces of the precious metal.
A fuel-cell microgrid costs about $200 000 (R2 million) to install. Taking operating and capital expenses into account over 20 years, the Naledi Trust system costs $1.05 a kilowatt per hour (kW/h) to supply 35 homes. That’s comparable to the cost of extending the national power grid 8km, according to Amplats. Fuel cells may be an economical option for providing electricity to communities that are more than 8km from the national grid, with as many as 200 homes that each require less than 3kW a day.
Platinum producers are eager to see wider use of fuel cells, which will boost demand for the metal which has slumped 12 percent this year. The systems are also being used to power cellphone towers in remote locations and warehouse forklifts. Amplats is developing fuel-cell systems to power equipment in rural schools and mining operations.
Fuel cells may be an economical option for providing electricity to rural communities.
About 70 percent of the platinum that’s produced every year ends up either in jewellery or in catalytic converters that control emissions from cars. Europe accounts for 25 percent of platinum use, with the continent’s vehicle makers the biggest source of demand behind Chinese jewellers, according to Johnson Matthey.
The weak economy Europe drove sales of cars to a two-decade low last year, and demand has been slow this year.
Mining companies are also banking on the mainstream adoption of electric cars powered by hydrogen fuel cells instead of batteries. Hyundai began deliveries of a consumer SUV using the technology in June and Toyota detailed plans for its Mirai sedan on Monday.
IHS Automotive estimates that global sales of light vehicles may reach 100 million by 2020. If 1 percent of them were powered by fuel cells, demand for platinum might climb 8 percent by then, Pillay said.
One caveat might be supply; it was not clear whether producers would be able to satisfy vehicle manufacturers’ needs, Kavanagh said.
“There isn’t enough platinum for fuel cells to become a mainstream technology, that’s the reality,” he said. Fuel cells would “remain a niche technology”, he said.
When the project started in August, Deputy Mineral Resources Minister Godfrey Oliphant said: “The entire fuelcell value chain could be located in South Africa once sufficient scale is created.” – Bloomberg