National

Will 2015 be the year hydrogen took off?

by Shinya Ajima

Kyodo

Industries are increasingly pressing pushing for the adoption of hydrogen fuel technology because they sense potential market opportunities worldwide.

But problems abound, including the comparatively high cost of fuel-cell vehicles and the need for specialized hydrogen fuel stations. Also unresolved is how to generate, transport and store hydrogen in a sustainable way.

FCVs run on electricity generated from the oxidization of hydrogen to create water.

In a rare move, Toyota Motor Corp. announced last week that it will allow other firms to use its nearly 6,000 patents related to fuel cells. It said it wants to spread the technology globally while spurring competition for further development.

Toyota began selling its fuel cell-powered Mirai sedan in Japan in December, becoming the world’s first carmaker to offer an FCV for general use. It is preparing to launch what it calls “the ultimate eco-car” in the United States and Europe this summer.

The world’s largest carmaker takes the view that environmentally friendly cars can benefit society only when they are in widespread use.

“We’ve determined that it is important to increase the number of supporters in order to realize a hydrogen society,” Toyota President Akio Toyoda told reporters following the patents announcement.

FCVs debuted in the early 2000s, and Japanese carmakers and suppliers have led the development of the technology, accounting for more than half of the global patent applications related to fuel cells and hydrogen stations.

Toyota’s decision might be welcomed at a time when rivals Honda Motor Co., Nissan Motor Co., Daimler AG and General Motors Co. are preparing to roll out FCVs of their own over the next few years.

“It’s an unusual decision to promote development,” Toshiyuki Shiga, vice chairman of Nissan, said.

The move highlights, however, automakers’ skepticism as to whether costly FCVs, which face competition from other environmentally friendly technologies, are a commercially viable transportation option.

The Mirai, which means “future” in Japanese, costs a hefty ¥7.2 million, although a government subsidy knocks around ¥2 million off the price.

Toyota plans to produce only 700 units this year, while acknowledging the price is still high and pledging further efforts to cut costs.

The success of FCVs largely depends on how a wide network of hydrogen fueling stations is created. While there are only a few in Japan, the government is in the midst of a hydrogen station blitz.

In June, the Ministry of Economy, Trade and Industry drew up a road map for bringing about a “hydrogen society” in which the gas even plays a central role in homes powered by fuel-cell batteries, which, like those in FCVs, emit only water and heat as byproducts.

The long-term strategy also refers to the need to build large supply chains and establish methods to produce hydrogen more efficiently and without emitting carbon dioxide.

As part of the road map, the government will set up 100 hydrogen fueling stations this year in major cities.

Each station costs ¥400 to ¥500 million to build, compared with about ¥100 million for a petrol station, due to the extra equipment required for storage, which involves heavy compression and chilling the gas to subzero temperatures.

“So far, it is unprofitable. We want to lower building and operating costs,” said Ichiro Uchijima, executive vice president of JX Nippon Oil & Energy Corp.

The firm opened a hydrogen station in Kanagawa Prefecture last month, and plans to manage 40 stations by the end of March 2016.

JX sells hydrogen that can run an FCV for 1 km for about ¥10, which means its running costs are almost on par with that of hybrid cars. Major gas distributors, including Tokyo Gas Co. and Iwatani Corp., have set prices at similar levels.

Iwatani accounts for over 50 percent of the industrial hydrogen and equipment market in Japan. Its unusual approach will involve building stations at convenience stores to popularize the technology. Cooperating with Seven-Eleven Japan Co., Iwatani looks to open the first station this fall in Aichi Prefecture, where Toyota is headquartered.

Sources say Japan aims to halve station-building costs by 2020, the year around which the road map sees a “remarkable expansion” in public use.

Tokyo will host the Summer Olympics that year, which the government hopes will be an opportunity to showcase the technology with hundreds of FCVs on the road.

Toyota said as much by offering its FCV patents through 2020, although those related to hydrogen stations will be freed up indefinitely.

Efforts to make FCVs commercially viable have long suffered from the chicken or egg question — more cars must be built to increase fueling stations, and more stations must be built to increase cars.

Toyota rejects the concern, however, with its president saying it is more like a relation between “flowers and bees” instead. “They help each other and then create a new society.”