Hydrogen to Near Price Parity With Gasoline by 2025

Renewable hydrogen production plants in California will sharply lower the cost of fuel.

June 15, 2020

SACRAMENTO—Hydrogen for fuel-cell vehicles will probably come closer to the price of gasoline within five years, according to a new report by the California Energy Commission, as reported in Green Car Reports.

The commission’s report drafts a plan for building renewable hydrogen production plants in California, forecasting future demand and costs will make the development a good bet. “The key findings are that the dispensed price of hydrogen is likely to meet an interim target based on fuel economy-adjusted price parity with gasoline of $6 to $8.50 per kilogram by 2025,” according to the report.

The report’s figure leaves out any impact from the California Low Carbon Fuel Standards credits, which would further reduce the consumer cost of hydrogen. The commission calculated the cost based on vehicle efficiency, not energy density or the cost of fuel-cell powertrain components.

Stakeholders believe that hydrogen should reach price parity with gasoline to push fuel-cell vehicles into a self-sustaining business minus subsidies. Price equality with internal combustion vehicles has long been the end goal for battery-electric vehicles, but usually, the terms revolve around battery price, not efficiency.

Fuel-cell vehicles consume more energy than battery-electric and hybrid cars. Volkswagen also revealed why fuel-cell passenger cars don’t make sense, in the automaker’s view, because of the inefficient method of generating hydrogen, among other reasons.

The commission also noted that commercial buses, ships, trains and trucks could use hydrogen as a fuel source. Toyota recently debuted a new joint-venture program to create a “hydrogen-based society” in China. Hyundai also has said it wants to bring fuel cells to other applications beyond vehicles.

NACS Magazine explored the use of hydrogen as an alternative fuel in “Fuels Errand?” in the October 2019 issue.