Hydrogen - Growth Drivers of Fuel Cells, Part 3

High demand for fuel cell electric vehicles 

As vehicle emissions account for more than 15% of the global greenhouse emissions, governments worldwide focus on finding alternative modes of powering the transportation sector. Due to their no emissions nature, fuel cell electric vehicles are expected to play an essential role in meeting the emission reduction targets set by various regulations. Consequently, several global automotive manufacturers make considerable investments to incorporate fuel cell vehicles in their product offerings. Reputed companies such as Honda, Toyota, Hyundai, Daimler, BMW, and others... are already developing hydrogen-based fuel cells due to their zero-emissions nature. As per an article by PRNewswire, within the automotive industry, heavy-duty buses and trucks are expected to create enormous demand for >250KW fuel cells due to the high efficiency of fuel cells in long-range transportation.

Under the EV30@30 campaign, several countries, including Canada, Finland, France, Japan, Mexico, Netherlands, Norway, Sweden, and India, are gearing up to speed up electric vehicles' deployment in their countries. The campaign targets to achieve a minimum of 30% new electric vehicle sales by 2030.

Government subsidies related to fuel cells

Under the Paris agreement, about 174 countries have agreed to minimize their carbon emissions to ensure that global temperature rise stabilizes at 1.5oC. This stabilization needs to accommodate the growing electricity demand. Few countries, including the United States, Japan, and China, offer subsidies to people buying fuel cell-powered electric vehicles. These countries have set targets for the number of fuel cell electric vehicles to be operational on the road by the end of a specific year. Currently, China offers a subsidy of about USD 22,000 on the purchase of a fuel-cell-powered electric car. The Chinese government aims to get a million fuel cell electric cars running on the road by 2030. Growing subsidies worldwide and better technology solutions will increase fuel cell electric vehicles' adoption, leading to higher economies of scale and more robust fuel cell demand.

High potential demand from distributed generation and CHP applications

The intermittent nature of renewable energy sources has caused instabilities in electrical systems, creating a demand-supply gap. Therefore, many authorities are focussing on distributed generation solutions. Companies that adopt distributed generation solutions based on low carbon fuels receive incentives in the United Kingdom. Due to the growing emphasis on clean energy sources, fuel cell-based spread generation systems will be in high demand. Similarly, combined heat and power (CHP) generation can be conducted efficiently using fuel cells due to their ability to operate at high temperatures.

CHP technology generates electricity while capturing the heat generated during the process, which would otherwise get wasted. This technology has applications in commercial & residential buildings, refining, chemical manufacturing, and district energy systems. According to the United States Department of Energy, fuel cells operate at approximately 80%-90% efficiency in CHP applications. Thus, the distributed generation and CHP markets are driving the demand for fuel cells going forward. 

A growing network of hydrogen fuelling stations

As per an Advanced Energy Economy article, the development of hydrogen fuelling stations costs about USD 1 million per station and nearly 18 to 36 months. Thus, the process of scaling up of such facilities will be gradual. The same article discusses Germany, the United Kingdom, Japan, and South Korea to develop hydrogen infrastructure. The state of California in the United States is co-funding the build-up of about 45 hydrogen refueling stations. Germany's H2Mobility program shall support the adoption of fuel cell vehicles by developing fuelling stations.

Additionally, Europe's Hydrogen for Innovative Vehicles project (HyFIVE) aims to expand its hydrogen fuel cell network, developing stations in Italy, the United Kingdom, Austria, and Denmark. Similarly, Japanese automobile giants such as Honda, Toyota, Nissan, etc. are parties to an agreement between ten Japanese gas companies to develop a 100-station hydrogen highway within the country jointly. South Korean company Hyundai-Kia Motor Co. is working out options with the government to strengthen the hydrogen infrastructure. Indian Oil, India's largest refiner, and fossil fuel retailer has initiated a USD 40 million demonstration project for hydrogen fuel cell vehicles. The company is the largest hydrogen producer in India and aims to build a strong hydrogen distribution network. China has also been doubling its hydrogen infrastructure since 2016. The country already has 61 hydrogen fuelling stations, and 72 projects are in the pipeline. Global efforts to augment hydrogen refueling stations' network will expedite the fuel cell market's growth. 

Strong potential opportunities from the defense and space segments

As a fuel, hydrogen contains more than thrice the energy by mass than jet kerosene, creating mass savings on account of lower weight and higher range than battery-electric propulsion used today. Similarly, hydrogen fuel cells' zero-emissions nature makes them an ideal option for space missions that entail massive electricity requirements. Fuel cell efficiency has a long history. NASA has used fuel cells in various space programs such as Gemini and Apollo. As per an article by the energy news, a compact, 12-pound device with fuel cell stacks can generate about 250 watts of electricity continuously for one or two years, while a similar-sized battery may work only for a month. NASA is also working on regenerative fuel cells that can use electricity and water to generate hydrogen and oxygen. According to an article by Forbes discussing space investments, in 2019, USD 5.8 billion was invested by venture capitalists across the world in 178 commercial space start-ups. This investment was 38% higher than in 2018 and the largest private space investment in a year. Two US-based companies, Blue Origin, and SpaceX are producing more than 41% of the assets. Over 55% of the investments were made in US-based firms, followed by China and the United Kingdom. Since the space industry has long relied on hydrogen and hydrogen fuel cells for its exploration programs, the accelerating space investments lay a strong foundation for the rapid uptick of the hydrogen fuel cells market.

The United States military is also developing hydrogen fuel cells for applications in uncrewed aerial vehicles, crewless undersea vehicles, light-duty trucks, etc. The benefits of hydrogen fuel cells in the defense sector include compact size, lightweight, minimal sound, high reliability, more extended range, lesser refueling time, lower maintenance due to fewer moving parts, zero lubricants, etc. The output from hydrogen fuel cells - water- can also help keep the astronauts and soldiers hydrated. Thus, space and defense sectors will drive the growth journey of fuel cells.

Read also...

Hydrogen - Contributing to the Future of Renewables, Part 1

https://www.dhirubhai.net/pulse/hydrogen-contributing-future-renewables-stephan-horvath-%E9%9C%8D%E7%93%A6%E7%89%B9-

Hydrogen - Growing Future Applications, Part 2

https://www.dhirubhai.net/pulse/growing-future-applications-hydrogen-stephan-horvath-%E9%9C%8D%E7%93%A6%E7%89%B9-

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