dynaCERT Inc. President Bernd Krueper on hydrogen, fleet operators, ESG, diesel engines, and stock performance

In my previous positions, including my recent role as CEO of the German engine manufacturer HATZ, I was very involved in the market for combustion engines and their applications in both the automotive and off-highway sectors. I have always been particularly interested in targeted innovations to reduce fuel consumption – and thus the so-called total cost of ownership – as well as lowering emissions. dynaCERT's HydraGEN™ device offers a retrofit solution for diesel engines designed to protect the environment while providing economic benefits. Naturally, this caught my attention, and I wanted to learn more.

I immediately thought about the combustion engine market and its diverse customer and user base. Having worked in the engine and vehicle industry for over 30 years, I have developed close relationships with customers worldwide. Understanding the market's needs is critical to success. However, the world is dynamic, and it is crucial to know what is needed today and what will be needed tomorrow and beyond. In recent years, political decisions have also influenced the market. So it is not just about what the customer wants, but also what is in line with government requirements. With HydraGEN™, dynaCERT offers a solution that brings numerous advantages to users. In the competitive landscape on European roads, cost-saving measures through HydraGEN™ can provide a significant edge in terms of profitability and competitiveness, especially in the logistics and transportation sector, which is known for its tight competition. We discussed this again with many market participants at the IAA TRANSPORTATION in Hannover. As I mentioned, with HydraGEN™, fleet operators can save fuel with their existing diesel engine vehicles and, therefore, money, which increases our customers' margins.

Imagine you are a transport company owner with a fleet of 400 trucks, of which 40 are replaced by new models every year. What type of drive system would you choose today? The answer is complicated because, in many countries worldwide, the necessary infrastructure for battery-electric vehicles or hydrogen supply is not yet in place, and some technologies are not yet economically viable. What I do see, however, is the potential that dynaCERT is already making available today with its HydraGEN™ technology. The system allows hydrogen to be generated directly on the vehicle by simply adding distilled water into the HydraGEN™ device, which is then injected directly into the diesel engine.

This future-oriented technology is already available today, and you, as the fleet operator in question, can start immediately to reduce fuel consumption and contribute to environmental protection. This applies to the 40 new trucks and the remaining 360 trucks in the existing fleet. In many cases, the very manageable costs for procurement and installation are already amortized within a year due to the fuel savings. Moreover, one does not need to purchase a significantly more expensive, pure hydrogen truck and wait even longer for the corresponding hydrogen infrastructure.

For a truck, like those commonly used in the transportation industry, the HydraGEN™ technology is housed in a unit resembling a tower PC's size and appearance. The device is mounted on the vehicle and, when the engine is running, uses electrolysis to generate hydrogen from distilled water, separating the oxygen. The hydrogen is then drawn into the combustion engine's intake system via a specific line before the turbocharger. This improves the efficiency of the combustion process, which ultimately results in lower fuel consumption and reduced pollutant emissions. Numerous pilot projects worldwide have shown fuel savings of 5% to 15%, depending on the application, load profile, and driving behavior of the individual driver. These savings are significant. The unit's distilled water tank has a volume of two litres, which is usually sufficient for 80 operating hours. As soon as the distilled water tank is running low, or sufficiently before that, a telemetric or automatic warning is issued.

Our task at dynaCERT now is to address our target group more directly – especially here in Germany and Europe – and to point out the many advantages of our HydraGEN™ units. Customer care is at the forefront of this. We want to know where we can improve and develop further. In my professional career, I have repeatedly found that customer feedback can be an enormous advantage for the further development of the solution offered if one wants to hear this feedback and further develop the products in line with customers and the market. At dynaCERT, we are doing exactly that. And we need to do even more educational work in the media and in politics, although we are now finding more and more open ears here. Our technical solution is available for purchase and installation today. Not only fleet operators and their customers who create ESG reports can benefit from using HydraGEN™, but every user of larger diesel engines. Some of our customers who use our HydraGEN™ units can even collect additional fees from their customers for the environmentally friendly use of the equipped vehicles.

From an economic point of view, fleet operators with a large number of trucks are particularly attractive to us; the more installations, the better. Vehicles that regularly travel long distances are also of interest. In general, however, all diesel engines are relevant, especially in commercial applications and power classes beyond the passenger vehicle range. We also want to explore niche markets to gain experience with specific applications. Diesel engines in the raw materials sector are extremely exciting, especially in mining and oil and gas exploration. In this area, you will usually find extremely large engines with corresponding power output and high fuel consumption. The advantages of dynaCERT's HydraGEN™ are particularly evident here.

The IAA TRANSPORTATION is a key meeting place for national and international manufacturers and suppliers in the commercial vehicle and transportation industry. It was a great opportunity to observe and discuss trends and topics within the scene. Developments in the industry that have not yet been publicized by the media are particularly interesting. Of course, I took the opportunity to present dynaCERT to my discussion partners. It was a welcome topic because among the exhibitors this year, and especially after the partial disillusionment with the unsatisfactory BEV (battery electric vehicle) situation, hydrogen as an energy source was once again a dominant topic. However, a common concern among many of my colleagues remains: where will enough green hydrogen come from without creating a new dependency on third parties? In this context, I was also able to point out the convincing advantages of the HydraGEN™ technology because the device generates the hydrogen itself on board as needed. There is no need for complex transport or the construction of expensive pipelines to supply it.

At the beginning of the hydrogen hype, the capital market pinned high hopes on a few young companies due to a lack of alternatives. These hopes have yet to be fulfilled. However, the hydrogen universe is complex and the market participants involved still have a long way to go in synchronizing and harmonizing their activities. Some of these players certainly hold significant potential. Due to my professional background, I am particularly interested in developments at the major engine manufacturers and in demanding commercial applications and operating conditions. These companies are conducting extensive research and already have attractive products, but the transition to new types of propulsion will be a long way off in many areas, and it will likely take many years or even decades before the necessary infrastructure for charging electric vehicles or hydrogen is sufficiently in place. That is why dynaCERT has such enormous potential. We do not need to invest in infrastructure; our devices can be installed and operated with minimal effort. In the US, over 13 million diesel trucks were on the road in 2023, compared to only 1,200 EV trucks registered. Imagine what this ratio would look like in other countries or regions of the world. This shows us that dynaCERT's HydraGEN™ devices have enormous potential.

I would not have quit my previous job if I was not convinced of dynaCERT. I believe in the Company's success, which is why I also invested as a shareholder. I am convinced that we have exciting years ahead of us. I know that the Corona measures of the last few years have hit the Company hard financially. Before that, the stock price peaked at CAD 1.25, and now shares are available for around CAD 0.20. If we do a good job now, I can see us convincing not only our customers but also the capital market of our success story again. We are already seeing some encouraging signs and developments!