Who believes in the future of fuel-cell electric vehicles (FCEVs)? Many experts feel they are too expensive and can’t compete with battery EVs. But now the Chinese government is throwing its weight behind FCEVs. Ankit Mishra spoke with Daniel Teichmann, CEO of Hydrogenious Technologies, about the brightening prospects of fuel cell cars.

A number of recent indicators and experts suggest that China is becoming the center of a global energy transformation, which is fueled by technological change and the falling cost of renewable-energy sources.

The “golden bullet” for electric mobility

Earlier this year, the US-based Institute for Energy Economics and Financial Analysis (IEEFA) released a report outlining China’s commitment to becoming a global leader in clean energy investment and promoting the development of energy-efficient vehicle transportation. As part of China’s plan, the government has put a strong focus on fuel-cell electric vehicles (FCEV) which, in comparison to battery electric vehicles (BEV), can travel farther and are refueled in a similar way to diesel and petrol cars.

FCEV’s comparative advantage in range and user-friendly refueling infrastructure led 78% of executives in KPMG’s latest global automotive executive survey to conclude that FCEVs will be the “golden bullet” for electric mobility. The United States, China, Japan, Germany, France, and the United Kingdom have all been developing initiatives to deploy FCEV technology. But the largest potential for impact is expected to be in China, which is looking to utilize clean energy technology in order to transition to a low-carbon economy.

“For the last 2–3 years, the Chinese government has put great emphasis on the roll-out of fuel cell mobility in China, shifting the public support focus slightly away from BEV to FCEV”

To deploy FCEVs in China, the government has announced plans to build hydrogen infrastructure to support about 50,000 zero-emissions fuel-cell cars by 2025, with plans to rapidly expand to 1 million FCEVs in service by 2030. Under China’s New Energy Vehicle roadmap, the country will also build 300 hydrogen refueling stations by 2025 and 1,000 by 2030. In conjunction with the Chinese government, several regions and cities—such as Rugao, Shanghai, Guangdong, and Wuhan—have also established hydrogen development centers and communicated ambitious roll-out plans.

During an interview at the Cleantech Forum San Francisco in 2018, I spoke with Dr. Daniel Teichmann, CEO at Hydrogenious Technologies, a hydrogen storage company based in Germany, which has recently entered into a collaboration agreement with Zhongshan Broad-Ocean Motor Co., Ltd. from China. He mentioned that the Chinese and regional governments have been supportive of FCEVs, which has facilitated the deployment of the technology in buses, large duty vehicles (LDV), and trucks.

Shifting focus

“For the last 2–3 years, the Chinese government has put a great emphasis on the roll-out of fuel cell mobility in China, shifting the public support focus slightly away from BEV to FCEV, mainly buses, LDV, and trucks. The roll-out of FC-mobility has become a part of the country’s 5-year plan and thus has also been picked up by the regional 5-year plans,” Teichmann said.

Key factors encouraging the Chinese government to actively promote fuel-cell vehicles are the environment and the Paris Climate Treaty, which is taken seriously by officials. According to the Global Environment Facility (GEF) project, “Accelerating the Development and Commercialization of Fuel Cell Vehicles in China,” hydrogen powered fuel cell vehicles can help mitigate the impacts of climate change and improve the lives of many in China.

This is thanks to hydrogen which, when produced from renewable energies, can be a carbon-dioxide free energy source. Given the high air pollution levels in numerous Chinese cities, Teichmann added that FCEVs are likely going to become a viable commercial option because their usage can help China address its air pollution caused by urban vehicle traffic, and increase its auto industry’s global competitiveness.

“Air pollution levels in numerous Chinese cities are extremely high, which makes the calls for action even stronger than in other parts of the world. FCEVs will have an enormous positive impact on the air quality and can help China’s auto industry become more globally competitive,” he said.

To achieve success in the roll out of FCEVs, China will need a coordinated national and local policy, along with regulations and technical standards to guide the sound development of this industry. There are likely to be several hurdles along the way. Critics have argued that hydrogen fuel cell technology is costly, potentially unsafe, and lacking in supporting infrastructure.

“FCEVs will have an enormously positive impact on the air quality and can help China’s auto industry become more globally competitive”

At the San Francisco conference, Andrew Hinkly, Executive Head of Marketing at Anglo American Platinum, who led the investment of Teichmann’s Hydrogenious Technologies, told me that despite total cost of ownership (TCO) for FCEVs being higher than for internal combustion engine (ICE) vehicles, the cost issue can be addressed and brought down by using hydrogen from by-products and also by producing it from renewable resources via the electrolysis process.

“For passenger cars, TCO for FCEVs is currently around 10% higher than ICE vehicles in China, which assumes we continue to ignore the societal costs of poor air quality from ICEs. There are a number of ways to reduce the cost of FCEVs, for example when FCEVs are manufactured at commercial volumes, studies indicate cost parity (from a TCO perspective) can be reached by 2025 for medium to large passenger cars.

The cost of hydrogen will also reduce for example using hydrogen from by-products of chloride alkaline production and flare gas reduction as well as producing hydrogen using excess and otherwise curtailed renewable resources via the electrolysis process,” Hinkly said.

Safety issues

As for safety, Teichmann, who is working to address risk associated with hydrogen storage, mentioned that safety concerns can be solved by binding hydrogen to a carrier oil. Teichmann’s company, Hydrogenious Technologies, is building a liquid organic hydrogen carrier (LOHC) technology to bind hydrogen to a carrier oil, allowing the use of the existing infrastructure for fossil fuels to resolve the challenge of safe and reliable storage of hydrogen.

“Hydrogen is the smallest molecule, making it difficult to store and transport efficiently. It is also easily explosive in mixture with air, which again significantly increases the costs”

“Hydrogen is the smallest molecule, making it difficult to store and transport efficiently. It is also easily explosive in mixture with air, which again significantly increases the costs. This is exactly the aspect of the supply chain that Hydrogenious Technologies addresses with our innovative liquid organic hydrogen carrier (LOHC) technology,” said Teichmann.

He added that the carrier oil can easily be used in the existing infrastructure for liquid fuels. “The carrier oil is non-toxic, non-explosive, hardly flammable, not classified as a dangerous good, and can be very easily and safely handed in the existing infrastructure for liquid fuels,” Teichmann highlighted.

On the issue of infrastructure, the Chinese government will likely benefit from engaging with private companies and from providing long-term incentives to invest in fueling infrastructure. Outside China, there have been several instances where partnerships between governments and private companies have shown to develop fueling infrastructure for FCEVs. For example, in Germany, a consortium of the largest players in the market established a joint venture, H2 Mobility Deutschland, which committed to funding up to 400 public hydrogen refueling stations.

The German government co-funded 50% of capital expenditure under the National Innovation Program for Hydrogen and Fuel Cell Technology (NIP). Meanwhile, in the United States, Toyota partnered with the California Energy Commission (CEC) and Shell to install hydrogen refueling stations in California for the Toyota Mirai. The CEC granted $16.4 million toward the stations, with Shell and Toyota contributing $11.4 million.

In order to develop long-term fueling infrastructure and motivate people to purchase FCEVs, China should encourage greater private and public collaboration

The Chinese government so far has directed resources towards captive fleets (e.g., buses or trucks) to facilitate the commercial viability of hydrogen fueled bus fleets. In Shanghai’s Fuel Cell Vehicle Development Plan, the regional government has targeted 30% of all electric mass transit buses and commercial trucks will be FCEVs by the year 2030.

As an initial step, Teichmann believes that such measures will “directly lead to a higher utilization of the hydrogen refueling stations, which can be a good way to show the commercial viability of hydrogen fueled bus fleets.” However, in order to develop long-term fueling infrastructure and motivate people to purchase FCEVs, China should encourage greater private and public collaboration, as seen in other countries, to make FCEVs commercially viable in the next decade.

Editor’s Note:

Ankit Mishra is a senior growth analyst at Premise Data, where he manages network operations in Africa. He previously worked for the government of Ontario as an economist, analyzing the impact of the TransCanada Energy East Pipeline on Ontario’s economy, natural gas supply and environment. Prior to that, he worked at the OECD’s Economics Department, conducting research on India’s power sector for the OECD’s Economic Survey of India 2014.

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