For the past few years, Japan’s government has worked hard to promote hydrogen fuel cell vehicles as the transportation choice of the future, with millions of yen invested into projects designed to make the manufacture and use of hydrogen fuel-cell powered vehicles a commercial reality.
So far, Prime Minister Shinzo Abe’s government has setup generous hydrogen fuel cell incentive schemes that dwarf existing electric car incentives offered in Japan. It has committed to buying a large number of Toyota Mirai hydrogen fuel cell cars from the Japanese automaker for use in governmental fleets, and it has even heavily revised regulations on hydrogen refuelling stations to make them easier to install.
But despite all that, Japan’s government looks likely to miss its own target of having 100 hydrogen filling stations in operation across Japan by March 2016, making its dream of a hydrogen-powered economy seem unlikely at this time.
As Reuters reported yesterday,the current administration had earmarked more than ¥ 21.38
million billion ($178.37 million) over the past three years to subside the building of hydrogen fueling stations across Japan. Driven by its desire to be a market leader in hydrogen fuel cell technology — and eager to support the launch of the first hydrogen fuel cell sedans to be mass-marketed by Toyota and Honda — the Japanese government had set itself a target of having 100 hydrogen fuel cell stations in operation across Japan by March next year.
Before the start of the final round of funding applications — a portion with ¥9.59 billion of funds allocated to it — just 44 hydrogen fuelling stations had been approved. The final round only approved an additional 32 hydrogen fueling stations, leaving the Japanese government 24 fuelling stations short of its target.
The reasons for the delay aren’t entirely known, but it’s worth noting that each hydrogen fuelling station costs around $5 million to install and commission. In order for privately-owned companies to invest that kind of money in adopting hydrogen fuel alongside more conventional fuels like gasoline and compressed natural gas, a return on investment has to be guaranteed.
Right now, with only the hand-built, loss-leading Toyota Mirai hydrogen fuel-cell car in production, making a return on an investment in hydrogen isn’t assured. Even with government subsidies offering to meet up to one half of the $5 million build costs per site, those within the industry say it will take at least ten years, possibly more, before a return on investment takes place.
Just like electric cars before it, the only sure-fire way to see hydrogen fuel cell cars reach mass-market potential is if the government — and automakers — build the refuelling network themselves.
Unlike electric cars — which can at least be charged from a standard household outlet in an emergency — hydrogen fuel cell cars have no backup option. They must be filled up at a dedicated hydrogen filling station or run dry. Charging stations are also far easier and far cheaper to install: for the cost of one hydrogen filling station, between 60 and 100 CHAdeMO stations could be installed.
Like electric cars before them, hydrogen fuel cell cars need some serious infrastructure investment to reach mass-market appeal. The challenge now facing the Japanese government and manufacturers of hydrogen fuel cell cars is therefore crystal clear: invest for the long term, or remain the fuel that’s always ten years away.
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