President George W. Bush hailed hydrogen as the freedom fuel that would liberate the U.S. from its dependence on middle-eastern oil. Since then, shale oil and battery-electric vehicles have overshadowed hydrogen as the fuel of the future. Nevertheless, companies in the automotive and energy industry have kept faith in the tiny molecule and hydrogen is gaining momentum once again.
Observations
- Toyota, Daimler, BMW, Honda and Hyundai are the most vocal backers of the hydrogen vision. All have produced limited series of hydrogen fuel cell vehicles (FCVs), in the EUR60-80k range, for demonstration projects and selected customers.
- These automakers and several energy companies have joined forces in a Hydrogen Council and vowed to invest, in the coming five years, ten billion Euros to make the hydrogen vision come true.
- A KPMG industry survey shows that 78% of automotive executives thinks hydrogen fuel cell vehicles are the most promising option for clean mobility. The majority of executives believes that battery-electric vehicles will fail due to a lack of recharging infrastructure.
- While some oil companies have installed some EV chargers at their fueling stations, hydrogen fits their competences (processing and distributing chemicals) better and companies such as Shell and Total invest (modestly) in hydrogen refueling stations.
- Globally there are a little more than 200 active hydrogen stations; most are found in Japan (45), Germany (37), and the U.S.(33).
Analysis
While all other alternatives have (intrinsic) limitations in terms of sustainability and practicality, hydrogen (H2) has the potential to become the fully sustainable fuel that satisfies all of our transportation demands (i.e. cars, trucks and airplanes).
Despite recent breakthroughs (e.g. the Tesla Model 3 and the GM Bolt), automakers are still skeptical about the mass-market potential of BEVs (due to their limited range and the need for a recharging infrastructure) and hydrogen vehicles are back on the industry’s agenda
Attention for hydrogen has come and gone over the past decades. The last phase of hype over hydrogen cars peaked some ten years ago, until hybrids and battery-electric vehicles (BEVs) entered the market. Despite recent breakthroughs (e.g. the Tesla Model 3 and the GM Bolt), automakers are still skeptical about the mass-market potential of BEVs (due to their limited range and the need for a recharging infrastructure) and hydrogen vehicles are back on the industry’s agenda.
From an industry perspective, hydrogen is also the most desirable fuel of the future. Hydrogen cars basically match today’s consumer’s experience (long range, quick refueling) and motoring practices. From a value chain perspective, FCVs are much more interesting than battery cars as well. Car makers can develop and produce their own fuel cells and H2 storage systems and oil companies can produce and deliver hydrogen. The BEV, by contrast, shifts much of the automotive value chain towards a few battery producers and electric utilities.
Despite its advantages, hydrogen and FCVs still need four miracles (in the words of Obama’s Secretary of Energy, Dr. Chu) to gain relevance: cheaper fuel cells, mass production of H2 (clean and affordable), a network of refueling stations and better on-board storage systems. Much of this is an issue of scale, but technologies challenges remain with the efficiency of hydrogen production and conversion (i.e. H2 -> electricity).
Consequently, the future of hydrogen as a transport fuel remains uncertain. Along with hydrogen’s own challenges, ongoing developments in battery technology, e.g. solid-state or lithium-air chemistries, could deal the final blow to the hydrogen vision after all.
