Market introduction of hydrogen fuel (2016)

This work aims to assess the market potential of hydrogen fuel for cars. The results are based on a detailed description and analysis of the past, current and future market environment, of the stakeholders as well as the driving and inhibiting factors for the market introduction of hydrogen fuel. In more specific terms, the thesis is targeted at describing conditions for the market entry of hydrogen fuel in Germany for the prognosis horizons of 2020, 2030 and 2050. Facts are developed on the grounds of binding framework conditions and user acceptance assumptions, rather than based on political ideas, media hype or messages spread by the marketing departments of the car industry. Assumptions are verified by an evaluation of the conditions set by the institutional framework, a literature, a patent and a stakeholder analysis. Finally, assumptions are discussed with experts in a Delphi analysis and results are summarised using an adapted version of Porter’s Model of Five Competitive Forces. European regulation has been identified as a main driving factor. It includes several measures to support renewable energies as well as the implementation of the EU energy efficiency and climate targets. However, the extent of the future use of biofuels is unclear due to the sustainability debate; the positive impact of the currently applicable (car) CO2-standards will have phased out by 2035. By 2050, due to increasing traffic, CO2-emissions caused by cars are projected to increase by 19% compared with 1990 levels without any further action in the EU. In principle, clean car technologies, which could attain values of less than 40 gCO2/km, are ready for market implementation, including hydrogen fuelled fuel cell vehicles (H2FCVs). FCVs and an H2-infrastructure have to be introduced to the market in parallel. The balanced positioning of the H2-stations may be organised by the stakeholders in Germany. The costs for the erection of a network of one thousand H2-station would add up to less than one billion Euros. In particular during the market launch phase, a strong increase in FCV-sales is necessary to utilise the capacity of the developing network. In addition, investments in H2-production and distribution are necessary. With current fuel consumption and projected fuel costs between 4 USD/kgH2 and 6.70 €/kgH2 delivered and dispensed by 2020, the fuel costs without taxes would be reasonable. However, the problem of FCVs is that in the near term, they are expensive. In addition, the market transformation to FCVs requires drastic changes in vehicle technologies, in energy production, distribution and fuelling infrastructure as well as in stakeholder capabilities. The timeline for these changes will have to respect regular vehicle and equipment substitution cycles to keep transformation costs affordable. H2FCV market success requires well-timed concerted actions between all stakeholders. The task is tremendous; coordination and cooperation effort as well as investments still to be made will be very high, but the reward could be a significant contribution to the change towards a sustainable energy system. The main H2FCV deployment pathway is described as follows: - H2FCV-technology has a high degree of compliance with societally-desired targets. - FCVs as well as H2-production and distribution technologies have reached a high degree of technical readiness for market introduction. - A stable, predictable and demanding legislative GHG-reduction framework along with state incentives will encourage industries and customers to invest. - Implementation of an H2-infrastructure and stricter CO2-fleet standards could lead to the success of H2FCV-technology. - High FCV-costs could be reduced by scale effects and further technology development.