Concerns have been raised in China that an investment boom in technology and infrastructure to support hydrogen-powered vehicles risks being undermined because of insufficient supplies of clean H2.

Incentivised by government subsidies, 35 projects related to fuel cells, fuel-cell vehicles and hydrogen refuelling stations worth a combined 110bn yuan ($17bn) have been signed in China in the first five months of 2021.

However, the huge slew of projects could be hampered by a lack of hydrogen supply, especially of the climate-friendly green hydrogen produced from renewable energy via electrolysis.

Former minister of industry Li Yizhong told an audience at a recent conference that, while local governments in China are enthusiastic about the development of hydrogen, few have thought about where supply will come from.

The country has an ample supply of grey hydrogen, but without carbon capture this remains a source of significant CO2 emissions. For every tonne of grey hydrogen produced from unabated fossil fuels, nine to 12 tonnes of carbon dioxide are emitted.

China’s total hydrogen production is about 25 million tonnes per annum — 62% of which is from coal, 19% from natural gas and 18% a by-product of refinery operations.

A mere 1% is green hydrogen.

Some of the 35 contracts have been signed between businesses and local administrations.

About 24 provinces and cities have come up with plans to develop hydrogen-related infrastructure after the central government two years ago listed hydrogen refuelling facilities as part of its economic development plan.

Most of these plans have involved investment in the development of hydrogen fuel cell vehicles and refilling stations, which can be built a lot more cheaply and faster than large-scale hydrogen production projects

Last September, the Ministry of Finance pledged 1.7bn yuan in funding for fuel-cell vehicle development over four years in selected cities.

In Guangdong province in the south, for instance, the local government has allocated 30% of its total subsidy budget to hydrogen fuel cells and vehicles.

China aims to build 1,000 hydrogen refuelling outlets by 2025, up from 13 today, while increasing cumulative sales of fuel cell vehicles to 1 million by 2035.

These actions are intended to help the country reach its goal of net-zero carbon emissions by 2060, but questions have been raised about the inefficiencies and expense of hydrogen cars, compared to battery electric vehicles.

The inherent problem with hydrogen cars

According to European non-governmental organisation Transport & Environment, for every 100kWh of renewable electricity, you get 77kWh of useable energy from a battery EV (BEV), but only 30kWh in a hydrogen-powered fuel-cell electric vehicle (FCEV). A green-hydrogen-powered EV therefore requires more than two-and-a-half times the amount of electricity as a BEV.

One of the arguments in favour of FCEVs is that they can be filled up like petrol or diesel vehicles, eliminating the range anxiety associated with EVs — presuming that H2 fuelling will be widely available. It is also argued that they will be easier than BEVs for drivers who do not have easy access to a charging point, such as those who live in apartments or do not have a driveway.

But as Volkswagen recently pointed out, while explaining its decision to focus on BEVs, FCEVs will always be a more expensive option, and their perceived advantages will soon be undermined.

“With the battery-powered e-car, driving remains affordable. Current e-models are already at the price level of comparable combustion engine models.

“In contrast, the hydrogen car will always remain more expensive than the battery car – due to the complex technology and high fuel costs. Drivers already pay around €9-12 per 100km for a hydrogen car, while battery cars cost only €2-7 per 100km (depending on electricity prices in individual countries). And the topic of long-distance travel? That will soon no longer play a role. With the new generation of e-cars, ranges will increase to 400km to 600km, while charging will become increasingly faster.”