Two recent announcements out of Japan have dramatically cut the price that Japanese drivers will pay for a fuel cell car. Toyota unveiled its completed design for the fuel cell vehicle (FCV) it will put on the market in 2015. More importantly, the company revealed the price would be around ¥7 million, or $70,000. This is a big drop from the $100,000 price tag floated, alarmingly, a few years ago.
A day earlier, Japan’s prime minister Shinzo Abe called for subsidies of FCVs beginning next year. A part of the government’s economic growth strategy, these incentives reflect the hydrogen energy roadmap adopted by Japan’s trade ministry.
As described in my Fuel Cell Vehicles report, I’ve long said that the two impediments to fuel cell cars taking hold in the market are cost and infrastructure. Automakers like Honda and Daimler have already shown that the technology works, resolving early issues such as cold-start capability. FCVs will also deliver on the key performance characteristics that make them intriguing, as compared to battery electric vehicles: range and refueling. The Toyota FCV will have a 420-mile range and refuel in 3 minutes.
The Post-Fukushima Strategy
For longtime fuel cell technology followers, I am stating the obvious. The potential benefits of fuel cells in transportation have been well-understood for years. Honda, General Motors (GM), Daimler, Hyundai, and Toyota have all shown they can make cars that meet those performance targets. Nevertheless, in the U.S. media, the perception persists that fuel cells were made obsolete by the successful introduction of plug-in electric vehicles (PEVs). In Navigant Research’s recent white paper, The Fuel Cell and Hydrogen Industries: 10 Trends to Watch, I noted that the U.S. media would continue to tie these two technologies together – and would misunderstand the rationale for pursuing them both. Sure enough, this article asserts that the Japanese government’s goal is to crush Tesla.
Not quite. The Japanese government’s plan is to promote technologies and fuels that will help ensure the country never has another experience like the Fukushima disaster in 2011. The Japanese government also wants to grow the economy by supporting domestic industries.
The Market Will Decide
To take a phrase from President Obama, Japan has taken an “all of the above” approach in pursuing these two goals. Nissan and Toyota have done well in the PEV market. But fuel cells offer an alternative for consumers who may find that a plug-in car doesn’t meet their driving needs.
Japan has also made a huge commitment to fuel cells that provide residential power. The country’s residential fuel cell program has supported the deployment of over 42,000 combined heat and power (CHP) fuel cells in Japan. Manufactured by Toshiba, Panasonic, and Eneos Celltech, these residential units are sold through gas companies like Tokyo Gas. After Fukushima, when the plant’s backup diesel generators were rendered useless and employees scavenged car batteries to power monitoring equipment, the Japanese government set a requirement that the fuel cells be capable of starting up when the power is off. While these fuel cells employ a different technology from automotive fuel cells, the CHP program demonstrates both Japan’s commitment to pursuing whatever technology the country believes will support its energy resiliency (utilizing domestic expertise) and its willingness to support that technology in its early market introduction.
Japan has already committed to building 100 hydrogen fueling stations in key metro areas. The country’s energy companies are partnering in that effort. Note that the Japanese government is also supporting the automaker deployment of 12,000 charging stations in Japan. Again, it’s not an either/or prospect for Japan. The announcement on the FCV subsidies will put the cars at a price point where they might have a chance in the market. If the infrastructure is in place to make fueling reasonably convenient, then it will be up to consumers to decide whether FCVs will succeed in the market or not. Success will be measured over many years, not in 18 months.
Tags: Clean Transportation, Electric Vehicles, Fuel cell vehicles, Fuel Cells, Policy & Regulation, Renewable Energy, Smart Transportation Program
| No Comments »