Hydrogen Energy as the Future of Sustainable Transportation

hydrogen fuel cell vehicle market

The Hydrogen Fuel Cell Vehicle market is expected to grow at a compound annual growth rate of 46.65% over the analyzed period to reach a market size of US$6,717.320 million in 2027. The market stood at US$460.428 million in 2020.

Hydrogen Fuel Cell Vehicles (FCVs) are similar to electric vehicles (EVs) in that they power the wheels with an electric motor rather than an internal combustion engine. Unlike EVs, which must be recharged by plugging them in, FCVs generate their own electricity. A fuel cell generates electricity by combining hydrogen (H2) gas from the vehicle’s fuel tank with oxygen (O2) from the air, with only water and heat as byproducts. FCVs, like electric vehicles, are zero-emission vehicles, with no smog-related or greenhouse gas tailpipe emissions. Emissions are produced during the production and transportation of hydrogen fuel. Fueling a hydrogen FCV is analogous to filling up your gas tank. Fill the tank by attaching a nozzle from a designated hydrogen dispenser at a public station. Refuelling times are comparable as well: FCVs can be refuelled in as little as 5 minutes.

Types of FCVs:

FCVs are of 2 types passenger vehicles and commercial vehicles. Passenger vehicles involves automobiles which generate electricity generally using oxygen from the air and compressed hydrogen. By December 2020, 31,225 hydrogen-powered passenger FCEVs had been sold worldwide, according to IEA. As of 2021, only two models of fuel cell cars were publicly available in select markets: the Toyota Mirai (2014-) and the Hyundai Nexo (2018–). The Honda Clarity was manufactured from 2016 until 2021 when it was discontinued. In November 2021, Toyota Motor Corporation released a press release announcing the Second-Generation Toyota Mirai, a hydrogen fuel cell electric car. The car has a range of 402 EPA-estimated miles with zero emissions, which is roughly 30% longer than the first-generation Mirai. Furthermore, the company stated that with the purchase of the car, it would provide US$15,000 in hydrogen fuel.

Commercial vehicles involve buses, forklifts, trains, canal boats, ships, aeroplanes, submarines, and rockets can all run on hydrogen in various forms. NASA used hydrogen to launch Space Shuttles into orbit.

Increased Environmental Concern

As public concern about environmental degradation and natural resource depletion grows, various technologies that support the eco-friendly concept of environmental sustainability are being introduced into the market. Furthermore, increased awareness of the consequences of air pollution, as well as an increase in traffic and greenhouse gas emissions, drive the adoption of hydrogen fuel cell vehicles, which are less harmful to the environment than other conventional vehicles.

According to the International Energy Agency, the key pillars of decarbonizing the global energy system are energy efficiency, behavioural change, electrification, renewables, hydrogen and hydrogen-based fuels, and CCUS. The growing importance of hydrogen in the Net Zero Emissions Scenario is reflected in its increasing share of cumulative emission reductions. Strong hydrogen demand growth and the adoption of cleaner technologies for its production enable hydrogen and hydrogen-based fuels to avoid up to 60 Gt CO2 emissions in the Net Zero Emissions Scenario in 2021-2050, representing 6% of total cumulative emissions reductions.

Even in Terms of Infrastructure, Hydrogen Fuel Cell Vehicles Are Profitable

Although fuel cell vehicles are still relatively expensive today, their high cost is offset to some extent by the relatively low cost of refuelling infrastructure. Simply put, as the number of fuel cell buses increases, so does the cost of the infrastructure associate with them. On the other hand, increasing the number of battery-electric buses per charging station raises the infrastructure cost per vehicle because more power is required. In short, hydrogen fuel will continue to become more affordable. Because the low-cost production of renewable energy enables the production of green hydrogen at parity with conventional fuel prices in some regions, one can say that hydrogen fuel cell vehicles are smarter and more cost-effective modes of transportation, and maybe the future of smart mobility. The adoption of these vehicles is expected to increase over the forecast period, propelling the market growth.

Initiatives by the Government to Build Hydrogen Fuel Cell Infrastructure

Several policies have been implemented by various governments to address environmental concerns. For example, the state of California in the United States has committed funds to the development of 100 hydrogen refuelling stations is driving the market for hydrogen fuel cell vehicles forward in order to achieve its goal of 1.5 million zero-emission vehicles by 2025.

Regional and Geographical Insights:

On a Geographical note, North America and Europe are well-known for being early adopters of new technologies, accounting for a sizable share of the overall market. Market growth in these regions is primarily attributed to the presence of cutting-edge infrastructure, which is conducive to market growth. Customers are becoming more interested in hydrogen fuel cell vehicles now that supportive infrastructure is available. Furthermore, stringent environmental regulations in these regions, as well as strict enforcement of such regulations by law enforcement agencies, have pushed people to adopt more sustainable and environmentally friendly solutions. Although the prices of these vehicles are high due to their newness on the market, these regions have a relatively large population with high disposable income. These trends are propelling market growth by driving the adoption of hydrogen fuel cell vehicles among customers in these regions.

Besides that, Asia-Pacific is one of the most profitable markets for hydrogen fuel cell vehicle manufacturers, with enormous growth potential in this market. Because they have the infrastructure to support the adoption of these vehicles, China, Japan, and South Korea are very lucrative markets for market players. Japan has one of the world’s most advanced economies and has made significant contributions to environmental protection on a variety of fronts. Market participants are pouring money into countries in order to capitalise on the region’s growth potential. Over the projected period, this is anticipated to fuel market growth.

Hydrogen Fuel Cell Vehicle Market Scope:

Report Metric Details
 Market Size Value in 2020  US$460.428 million
 Market Size Value in 2027  US$6717.320 million
 Growth Rate  CAGR of 46.65% from 2020 to 2027
 Base Year  2020
 Forecast Period  2022–2027
 Forecast Unit (Value)  USD Million
 Segments Covered  Type, And Geography
 Regions Covered  North America, South America, Europe, Middle East and Africa, Asia Pacific
 Companies Covered Toyota Motor Corporation, Hyundai Motor Company, BayerischeMotoren Werke AG, Mercedes-Benz Group AG, Honda Motor Company, Nikola Corporation
 Customization Scope  Free report customization with purchase