Nikola Corp., a designer and manufacturer of zero-emission battery-electric and hydrogen-electric vehicles, has secured an electric rate schedule with Arizona Public Service Co. (APS) that makes possible the accelerated development of hydrogen-based fueling solutions for the transportation industry.
By facilitating low-cost production of hydrogen, the Arizona Corporation Commission’s (ACC) approval of this rate schedule paves the way for the curtailment of greenhouse gases in the transportation sector, while also providing benefits to key constituents via novel grid-balancing solutions.
The unanimous approval of this agreement by the ACC provides Nikola with a competitive electric rate specifically designed for the production, processing and dispensing of hydrogen. This will support, among other things, enabling a zero-emission heavy-duty freight corridor along the I-10 freeway between Los Angeles and Phoenix.
APS’s competitive electric rate will help lead the creation of the hydrogen economy in Arizona. Nikola estimates that under the rate structure it will be able to deliver hydrogen at market leading prices and within the ranges required for Nikola to offer competitive lease rates for its trucks customers.
Nikola notes the agreement reflects the value that results from the curtailment flexibility the company’s hydrogen production facilities are expected to provide to the electrical grid. These facilities will be configured to respond to the needs of the grid, for example by reducing Nikola’s energy consumption from the electric grid during heatwaves. This agreement will encourage Nikola to deploy capital within the state, increase electric load relating to hydrogen production, and further develop and employ a highly skilled and well-educated workforce.
“Nikola values the joint efforts of APS and the ACC to enable competitive electrolytic hydrogen production,” says Mark Russell, CEO of Nikola. “The approval of this special rate for hydrogen production is critical for advancing the future of zero-emissions transportation and building a hydrogen economy.”
Nikola says the approval of this agreement marks an important milestone. Going forward, the company will work with APS to finalize site selection and interconnection requirements to establish its first hydrogen production facility in Arizona.