Equipment Lease Package
How much does Something Cost? How about an Equipment Lease?
By Toby Kinkaid
The equipment Lease package answers the big question. How much does something cost? Well, it depends on how you buy it. Are you paying full price upfront? Are you financing the Capital Expense from a financial group to whom you’ll make monthly payments? Are you renting it? Do you lease?
The Equipment Lease package is the best kept secret in business finance. Equipment leasing is the greatest financial instrument in capitalism – in my opinion. The tax laws love leases.
All your payments are 100% deductible – essentially tax free. You don’t have to come up with the Capital Expense to acquire the hardware up front, and, once paying off the monthly payments over some lease term, then you’re released. With equipment leasing you can turn in the hardware, and lease the newest greatest, or you can acquire the asset paying a residual at the end. Or, walk away altogether.
The Equipment Lease package is great for the capitalist too. The underwriter of the Lease Package has the great benefit of owning the title to the asset during the lease term. In this way, should the deal go South and the Lessee can’t make the payments – then the Lessor (Underwriter) simply takes the equipment back.
Long before that would ever happen, however, the Lessor makes a credit check and confirms the Lessee is able to make the payments. Once credit checked the Lessor has everything they need to choose those packages which are strong.
In Equipment Leasing, If the Lessee has good credit, the business use of the equipment is strong, and the underwriter holds the title? Then, the deal looks good. Pretty sweet for the underwriter.
The fact is, the equipment lease structured as Equipment Leasing financing is designed to be ideal for everyone: the Lessee, and the Lessor. This is why it’s such a great option in the Green Hydrogen world.
A great project is being developed called the Green Hydrogen Highway. With over 2,000 truck stops in the US, for example, placing Green Hydrogen fueling stations for FCEV fleets is a natural fit. I suspect all future DC Fast Charge and H2 Fueling Stations will be structured under Equipment Lease packages.
The Brave New World of the Equipment Lease
At the end of the day – it’s our children’s world. We only “borrow” life it seems and some day must pass it on either through our genes or by re-entering the web of life.
Human history is so full of struggle, so full of trials, and tribulations and in all of that, and so much more, we’re here together to face it all.
We have a choice very few in history have ever had – the chance to evolve as a human civilization away from toxicity, abuse, inequity and servitude all mainstays of our fossil fuel world into something so much better: energy independence, security, growth, and non-toxicity.
The rest of the 21st Century is the greatest test of our collective humanity. We can’t fail at this next crucial evolution in our progress. We must save the world – literally, and it begins with a clear purpose. Not just rosy sounding words of vague intentions, but real purpose with a specific goal – not just a general one.
The goal is the economic and environmental stability in a modern world – with modern needs. As a species we’ve overcome so much throughout deep time to actually survive to be here now.
And, we are here now – and that is our real power. The New World will be based on integrity. Self determination. Self reliance and most of all self-destiny. The fulfillment of our individual journeys and our collective being.
Applying the Equipment Lease offers a win-win scenario for all players, project owners, land owners, project managers, operators and planned maintenance. Equipment Lease packages are designed to include all of these participants.
Our world cries out to us to get our act together. To recognize the only way to solve global problems is with a local common solution. The Green Hydrogen technology is more than just a sustainable power supply – although it is that. The real value is that the world can live with it. Imagine all of the resources and money used to supply fossil fuels all over the world spilling, leaking, and burning all along the way.
Our world is at the threshold of greatness if only we’re willing to accept the gravity of it – and act appropriately. I go back 30 years in the Hydrogen Industry and I’ve seen Solar PV Panels, Electrolyzers, Hydrogen Storage, and Fuel Cells drop in price dramatically. At last the industry is sophisticated enough to take on the challenge.
It will all begin with fleets. Fleet vehicles and Fleet Managers who run them are at the forefront of the Green Hydrogen revolution. Fleet Managers are the unsung hero’s of the world for they have the responsibility of making everything arrive on time.
Equipment Leasing offers the ultimate tool for managing fleets. It’s the Fleet Managers who have the immediate power to organize their fleets – take a strong measure of fossil fuel costs including but not limited to oil changes, transmission fluid changes and of course refueling through the entire life of the vehicles use – and compare that to fueling fleets with green hydrogen systems.
Universal DC Fast Charge and H2 Refueling Stations
The Green Hydrogen Highway will be the backbone of rapid adoption in the transportation sector. All Medium and Heavy duty (MHD) vehicles are best served with the Fuel Cell EV drivetrain because you can carry a lot of energy in a small mass with Hydrogen. And, you can fuel in any vehicle in around 15 minutes. Over three times more energy dense by weight than gasoline Hydrogen is alone in its ability to get the job done when it comes to heavy machinery.
The Green Hydrogen Highway is a concept to install a Green Hydrogen fueling station at each of the nearly 2,000 truck stops in the US. The traditional US truck stop is ideal for green hydrogen. Larger in footprint than a typical gas station, the truck stop is designed for heavy vehicles, and lots of them.
The Battery Semi promoted by Tesla offers big disadvantages when it comes to fleets of Semis. If a battery Semi you’ll need a Mega charger to DC Fast Charge (kinda) these super large battery packs – about 10 long range BEV car packs – per truck.
The Mega chargers are rated at 1.6 MW peak power demand – just for one vehicle. That’s 320 houses with everything turned on equivalent – to service one truck. Still taking a few hours even under DC Fast Charge, the electrical draw is not practical when you realize to simultaneously charge just 10 Semis you’ll draw around 16 Mw of additional power. To charge only 10 trucks!
In most utility grids they charge for Electricity in two ways: the peak power you draw, and then the total amount of kWh energy you consume. If you are a commercial facility then you may pay dearly for that power capacity. Some utilities charge a true “demand charge” which is dollars per kW peak demand – the high water mark of your power demand per month.
In Hawaii, without special consideration, the standard commercial rate for demand charge has been around $24 per kW. If you connect one Mega charger in Honolulu then the cost of accessing 1.6 MW would be about $38,400 per month! Just for the demand-charge. That’s before you buy the actual electricity or pay for the station. Totally impractical.
The Green Hydrogen station solves all of this by using onsite renewable energy and off-peak renewable energy from the grid. The combination of these two inputs provide the lowest cost electricity for making cost-effective clean hydrogen onsite.
All of the Reasons we need Industrial Clean Energy and Equipment Leasing
In our modern world we use energy for everything. We use it for fertilizer, we use it for transportation fuel, we use it for heating ventilating and air conditioning (HVAC) in our built environments, and we use energy extracting, moving and processing every material we use en mass. Everything, in short.
The Universal Green Hydrogen Micro-Hub is standardized power block everyone needs to do anything they want. Power your house? No problem, just size it properly. Power your business, no problem, just size it properly. Power your Fleet? No problem, just size it properly.
See the pattern here? Everything is only a matter of determining balance. What capacity you need in all these matters: the input, storage and output you desire in your power supply.
The Universal Green Hydrogen Micro-Hub is a standardized system which uses an Electrolyzer as the input device. The storage capacity of safely stored hydrogen as the Storage device, and the Fuel Cell stack as the electrical output device. Everything is in the art of engineering and the art of system design knowing how to proportion all components.
The green hydrogen industrial revolution is about one system: the standardized power block. Size it properly, and you have whatever capacities you so designate.
Equipment Leasing can bring your project to life and tap into enormous capital resources – available for lease finance.
There are Two Kinds of EV: BEV and FCEV
Everyone talks about EVs as though they’re one thing: battery EVs. This is not true, even though as a marketing ploy early on the EV manufacturers quickly hijacked the language to cut out any discussion of the “evil brother” of fuel cell drivetrains. Teslas is most famous – or infamous for this – everything can be battery powered – even grids.
There’s always a bit of half truth but leads to a false conclusion. Yes, large battery banks on the grid can be very useful for Frequency Control and Ancillary Services (FCAS) which utilize the quick response of Lithium-ion batteries – and this is good – to support the grid voltage, say in times of high temperatures. However, the less sophisticated idea that we can power the bulk grid from Lithium-ion battery packs is untenable when you do the math.
Our grid requires TWH of energy storage to allow renewables to be over built. We simply don’t have the 6 earths of Lithium, Cobalt and Nickel that would be required, and the environmental damage of trying to do so would ruin the one we have.
For bulk industrial power nothing compares to the logic of Green Hydrogen. Green Hydrogen systems use very little if any rare earth materials depending on the choice of technology. This is no small matter. Materials are a limiting factor when we consider scaling an energy component. Lithium-ion has a part to play, but it’s not the star of the show, so to speak. It’s a supporting actor.
The real star of the show is Green Hydrogen and hydrogen’s 60x energy density over Lithium-ion. The marketplace has very few choices standing today. However, Green Hydrogen is on the move and will make a much more effective bulk energy storage vector. Green Hydrogen offers utilities, transportation fleets, heavy machinery, heavy trucks and best of all heavy industry with a better fuel. A better fuel because it can be produced nearby or onsite with no fuel cost or toxicity.
Cement and steel plants have large footprints. The winning combination with renewables is to over build the renewables onsite, and tap into a local grid to absorb other’s excess renewables during off-peak times – the cheapest and greenest electricity available.
Bringing it all Together financing through Equipment Lease Package
The market for industrial fuels tops $6 Trillion per year. That’s a lot of scratch. The good news for the producers of fossil fuels, and the bad news for the consumer is you’re trapped. You have no real options if your machines run on fossil fuel chemicals. Although diesel engines can run on a variety of plant, animal and rock oils it’s the fuel cell vehicle running on green hydrogen which saves the day.
Fossil fuels are now directly expensive. There’s still a lot of energy in a gallon of gas, but consider the long journey it took to get to you, and how much other oil was burned in it’s processing and transport only to be burned with most of the energy lost out the tailpipe, well, do you see my point? Using solar landing on your head and converting it to industrially potent and clean fuel is hard to beat. And, indeed as it matures as an industry – it can’t be beat.
Fuel traveling thousands of miles undergoing pumping-on and pumping-off, refining, stowing and then delivery to where you can pump it again is – well, old fashioned to say the least. Rockefeller would be proud.
It’s also economic foolishness once green hydrogen systems hit the scene in force. This is the one great hope. The profit motive and self interest will drive the market away from toxicity, inequity and environmental suicide and into the arms of self-sufficiency and self-determination the cornerstone and new life-blood of the emerging 21st century.
The Equipment Lease package is a financial instrument which can work for everybody.
