Toyota rose to prominence in the efficient and alternative fuel vehicle space with the launch of its Prius hybrid vehicles in the early 2000s. The car is now a symbol of automotive efficiency, as almost 7 million Priuses have been sold worldwide, and the “Prius family” has grown to include three versions of the popular hybrid. In some cases, there’s a fourth: The Plug-In Prius, which was one of the top selling electric vehicles in 2012 and 2013 before Toyota began pulling back on the vehicle—it was setting its sights on something else. While most other automakers are focusing their post-oil strategies on electric vehicles, Toyota is zeroing in on a new hydrogen fuel cell car, one that the company hopes, someday, could even run on garbage, in a manner of speaking.
The Mirai, which means “future” in Japanese, retails for $57,500 before incentives, and Toyota is hoping it will mirror the success of the Prius. Toyota anticipates annual sales of the Mirai to reach 3,000 by 2017 and 30,000 by 2020, a tenfold increase. By the middle of the century, Toyota recently announced it will phase-out gasoline-powered cars entirely. Not all are in agreement: Goldman Sachs analysts estimate that fuel cell vehicles will account for 0.5 percent of total global vehicle sales by 2025.
But amidst the pomp and circumstance surrounding the U.S. launch of the Mirai, questions remain surrounding Toyota’s model for advancing fuel cell technology. How will the company address range and fuel capacity? How will Toyota lower fuel prices when current costs can be high? And who is going to build out the infrastructure to support hydrogen-powered FCVs?
- Onboard hydrogen storage
The process of generating electricity using a fuel cell system is two to three times more efficient than combustion, but hydrogen has a low volumetric energy density. Therefore, a relatively large quantity of hydrogen must be stored onboard a FCV to enable driving range comparable to internal combustion vehicles. In smaller cars the size, shape, and weight of the hydrogen storage tank required will have a negative effect on other attributes, such as cargo or seating capacity. For instance, although estimated by Car and Driver to run at 57 miles per gallon of gasoline equivalent, Toyota’s Mirai has range of approximately 300 miles. This is undoubtedly further than many of today’s commercially available battery electric vehicles—a meaningful advantage—but still far less than comparable gasoline vehicles like Honda’s Accord Sedan LX, which has an EPA rated range of 619 miles. Moreover, in comparison to the Accord Sedan LX, the FCX Clarity has almost 20 percent less cargo and seats only four passengers, not five.
While platinum represents a comparatively tiny fraction of the FCV’s total retail cost—about three percent by some estimates—current designs nonetheless use one-fifth of the amount they did a decade ago.
Technological improvements, and manufacturing at scale, will enable FCVs to “close the gap” in attributes and costs with conventional cars. Toyota has, for example, reportedly reduced platinum use in its FCV by more than two-thirds, from approximately 100 grams to 30 grams, through changes to the stack design and nanotechnology. These improvements resulted in a cost savings of almost $2,700 per vehicle, assuming a platinum price of $1,100 per ounce.[i] While platinum represents a comparatively tiny fraction of the FCV’s total retail cost—about three percent by some estimates—current designs nonetheless use one-fifth of the amount they did a decade ago. FCVs are also likely to benefit from the improvements made to electric motors, fuel cell stacks, and other components developed primarily for other alternative fuel vehicles.
Honda’s 2016 hydrogen concept car, which made its debut last month in Japan, uses a fuel stack that is 33 percent smaller, but 60 percent more power-dense than the FCX Clarity. The balance of components such as heat exchangers, flow control, air compression, and humidification systems, will continue to develop and become simpler and more cost effective. The development of both the fuel stack technology and balance of these systems may further drive down their costs as a percentage of total vehicle costs.
- Hydrogen fuel costs
Although hydrogen is abundant in nature, pure hydrogen suitable for use in FCVs must be captured from other compounds such as methane or water, and then compressed, before it can be used as a fuel. This process can be energy intensive, and expensive. Fuel economics vary by production method, but cost estimates currently range from approximately $4 per kilogram to $12 per kilogram, equivalent to a gasoline-gallon equivalent cost of roughly $1.60 to $4.80.
Further, the Department of Energy estimates that R&D efforts have reduced fuel cell costs by more than 30 percent since 2008 and more than 80 percent since 2002. A new class of catalysts, developed at the Lawrence Berkeley and Argonne National Labs, represents just one example of the next wave of hydrogen-specific research. These catalysts use approximately 85 percent less platinum and have more than 30 times the catalytic activity of current catalysts.
For FCVs to achieve meaningful adoption rates in the market, they will require a network of public fueling stations. This network—like networks for fueling natural gas vehicles or plug-in electric cars—will require substantial investment to establish. The cost of installing a hydrogen fueling station is currently estimated at more than $750,000 for a hydrogen dispenser at an existing gasoline station, and $2.1 million to $3.3 million for a purpose-built station that dispenses only hydrogen.
The State of California has committed $20 million per year in funding until at least 100 stations are publicly available, or until additional funding is no longer necessary. The Obama administration is seeking to help launch infrastructure nationwide through its H2USA public-private partnership, and some automakers have pledged their private support in this endeavor.
The California Fuel Cell Partnership, one of the first initiatives undertaken to expand the hydrogen fuel infrastructure in the United States, estimates that 68 stations are required to launch a “commercial marketplace” statewide. By 2021, they say these stations will enable the network to become “self-sustaining.” As of the start of Q3 2015, however, only 51 hydrogen fueling stations had been installed nationwide, a tiny segment of the overall infrastructure for alternative transportation fuels, according to the Alternative Fuels Data Center.
Hydrogen can be produced onsite using one of two primary methods: Steam reforming of methane gas, and water electrolysis. Both processes could ultimately be powered by renewable or recycled fuels.
The hydrogen dispensed at California’s already operational stations is primarily delivered by tanker truck. But several options for hydrogen production and transport could be considered depending on how the market develops. Over the long term, the most cost-effective solution for meeting higher levels of hydrogen fuel demand would appear to be the delivery of hydrogen by pipeline to a fueling station from a production facility. Alternatively, and perhaps more likely in some areas, hydrogen can be produced onsite using one of two primary methods: Steam reforming of methane gas, and water electrolysis. Both processes could ultimately be powered by renewable or recycled fuels, like methane gas from wastewater treatment for steam reforming and solar and wind for electrolysis. One such initiative, DOE’s wind-to-hydrogen project, aims to link wind turbines and photovoltaic arrays to electrolyzer stacks, allowing on-site storage and production of hydrogen for FCVs.
Closing the Gap
Toyota hopes that the U.S. launch of the Mirai will catalyze a market and infrastructure for hydrogen production and distribution. America’s newfound abundance of natural gas—which has cut the cost of hydrogen production—and existing network of pipelines could be put to use transporting hydrogen to existing gas stations. But in a recent article published in Foreign Affairs, researcher Matthew Mench argues that the U.S. will not lead this area of critical research. Japan and South Korea now lead the world in fuel cell patents, and a hydrogen distribution network is already underway in those countries as they seek to decrease their dependence on petroleum fuels.
Japan and South Korea now lead the world in fuel cell patents, and a hydrogen distribution network is already underway in those countries as they seek to decrease their dependence on petroleum fuels.
In the U.S., questions surrounding the safety, cost competitiveness, and infrastructure remain. Toyota hopes that its effort to bring a fuel cell car to market will establish a beachhead in the U.S., and it has set aggressive targets to bring its plan to fruition. But like any alternative fuel, success will depend on the economics surrounding the production and distribution of the fuel. Hydrogen benefits from refueling times that are equivalent to gasoline at existing petrol stations, as well as the possibility for on-site production. But even still, the learning curve for consumers remains high. Success will largely depend on private sector R&D, which will hopefully reduce technology costs to a level that is on par with gasoline-powered cars and batteries, making distribution economical.
[i] Assuming a $1,100 per ounce price of platinum, a 70 gram reduction equals 2.4 ounces x $1,100, or a savings of approximately $2,700 per vehicle according to data from Johnson Matthey, a precious metals company. This year, the average price of an ounce of platinum was $1098 through October.