Canadian Pacific Kansas City (TSX,NYSE:CP) is tapping a Canadian supplier – Burnaby's Ballard Power Systems (TSX, NASDAQ: BLDP) – to switch its locomotives from diesel to hydrogen in Canada and the U.S.
The Canadian railway operator – formerly known as Canadian Pacific – has signed a long-term supply agreement with Ballard for 98 fuel cell engines, Ballard announced Thursday in a news release.
CPKC has used Ballard fuel cell engines in a trial program that started in 2022, and currently has three hydrogen locomotives powered by hydrogen.
"We are thrilled with the opportunity to further develop our strategic relationship with CPKC to decarbonize not only their locomotive fleet but also participate in the electrification of freight rail across North America," Ballard CEO Randy MacEwen said in a press release.
"This order represents a step forward in CPKC's decarbonization vision and confidence in hydrogen fuel cells as a potential long-term replacement of diesel engines, providing the environmental benefits along with long range, fast refuelling, heavy payloads and cold weather operation."
As for where CPKC will get the hydrogen from, the company announced last month that two hydrogen production and fuelling facilities have been completed in Calgary and Edmonton, as part of its Hydrogen Locomotive Program.
The production and fuelling facilities were built in partnership with ATCO EnPower, a division of Canadian Utilities Limited (TSX:CU).
Each facility has a one-megawatt (MW) electrolyzer for making hydrogen from water and electricity, compression, storage, and fuelling systems for refuelling locomotives. The Calgary electrolyzer is powered in part with solar power from CPKC’s five-MW solar power installation at its headquarters in Calgary.
