Fuel cell technology dates to the 19th century but is still considered new because it is not widely available. Dubbed “the battery of the future,” fuel cells are a promising power source for their high efficiency and lack of greenhouse gas emissions. Their efficiency rating ranges from 40 to 60 percent and their byproducts are just water and potentially useful heat, according to the US’ Department of Energy (DOE). However, there are caveats to broad commercialization. They include cost and durability, in addition to safety concerns and hydrogen storage and transportation issues.
Nevertheless, continuous research has led to breakthroughs opening up applications, mainly in transportation, portable uses and stationary installations, according to National Geographic.
Industry analysts are forecasting high demand for fuel cells in the coming years. Deep Insight Research (DIResearch) Consulting, a Chinese market research company, said that the global market for fuel cells would be in the scale of $2.101 billion in 2024, rising 26.4 percent year on year, and go up further to $5.62 billion by 2030 at 17.82 percent CAGR.
History of fuel cells
Fuel cell technology found prominent applications in the 1900s when the National Aeronautics and Space Agency (NASA) took interest. The research that this US government agency undertook with its industrial partners yielded fuel cells used in the Project Gemini, Apollo and Skylab missions as well as the Apollo-Soyuz Test Project. In the then-Soviet Union, similar efforts focused on military applications, specifically for submarines, and later for manned space exploration.
In the 1960s, fuel cells were considered for the automotive industry, with experiments by General Motors and Shell. By the end of the 20th century, major car manufacturers in the world had introduced prototypes.
By 2007, fuel cells began to be available commercially. They have since been adopted in boats, campers, toys and educational kits, military communications and surveillance equipment, homes, telecom networks during emergencies and rescue operations, and materials handling and passenger vehicles.
Largest producer and consumer of fuel cells
China remains the world’s largest producer and consumer of fuel cells and its market is expected to continue expanding at a significant rate. In a report published by Inkwood Research in September 2023, the country will reach $4.8987 billion, posting a 19.31 percent CAGR between 2023 and 2028.
In the automotive segment, China ranked the third-largest market for fuel-cell electric vehicles (FCEVs) and the first for fuel cell trucks and buses in 2022, according to the Center for Strategic & International Studies.
In 2023, the number of FCEVs sold in China was 5,600, increasing by 55.3 percent year on year, according to the China Association of Automobile Manufacturers (CAAM). In December of that year, this hit 1,300 units or a 98.9 percent growth over the same month in 2022. Most are heavy- or light-duty vehicles instead of passenger cars.
Based on reports, the Chinese government intends to put 50,000 FCEVs on the road by 2025. Furthermore, China will keep boosting its FCEV segment at a fast pace from 2030 and will account for 5 percent of the global market by 2035, according to Securities Times, a national financial newspaper in the country.
Globally, the FCEV market will experience explosive growth in the next several years. The International Energy Agency said that the car parc of such vehicles will ramp up to 10.5 million to 15.5 million units in 2030, posting a CAGR of 81.32 to 89.34 percent from 2021.
Further research
Still, there are challenges ahead despite breakthroughs, necessitating further research into new materials. In recent years, nano technology was adopted to improve the fuel cell’s structure and the efficiency of its catalyst to help lower cost and enhance durability. However, there are still no alternatives to precious metals, including platinum and ruthenium, used as catalysts. These are limited resources and therefore have a high cost. So, researchers are looking into substitutes, such as molybdenum dioxide and other nonprecious metals, that are as good but not as expensive.
In China, the Dalian Institute of Chemical Physics, Chinese Academy of Sciences has announced a breakthrough in catalysts. It developed a highly reliable PtRh/Pt oxygen reduction catalyst that will ensure stable performance in fuel cells.
China fuel cell industry buildup
The promising future of the fuel cell industry has been attracting domestic and overseas investment in China. In 2023, there were 27 projects that began construction in various parts of the country.
Shenzhen Hynovation and Dongguan Yangxing announced a joint investment of $236 million. Upon completion, the facility, with a total area of 40,486sqm, will have an annual capacity of 38,000 fuel cells valued at $166 million.
Industrial parks are also being built to complete the industry chain. State Power Investment Corp. is allocating $1.388 billion for a hydrogen industrial base in the Yellow River Basin. The first phase, costing $555 million, will entail the setting up of a state-level hydrogen energy innovation platform for fuel cells. It will focus on materials development toward expanding applications in transportation, power supply and other industries.
This undertaking is expected to attract upstream and downstream enterprises, with a target to reach annual capacity of 10,000 fuel cells by 2025 and more than 100,000 units in 2030.
Domestic suppliers of materials are working to improve their technology to catch up with foreign counterparts and snare a bigger share of the Chinese requirement. They include Shanghai Jiping, Wuhan Himalaya and Sino-Platinum.
Catalysts, which represent over 40 percent of total fuel cell costs, mainly come from industry leaders BASF, Johnson Matthey and Umicore. Those from overseas companies are available below 0.2g/kW, while China-made ones are still at 0.3 to 0.4g/kW or having more metal. This makes imported versions a low-cost but high-performance option.
Securities Times reported that hydrogen energy would account for 10 percent of China’s whole energy system by 2050, with annual production value to exceed $138 million. By then, the annual capacity for fuel cells across applications will be up to 5.5 million units.
Fuel cell hubs
Manufacturers in China’s fuel cell industry chain are found in Jiangsu, Zhejiang, Shanghai, Beijing, Guangdong, Henan, Sichuan and Hubei, with the first three areas gathering over half of the pool.
Key international players operating in China include Plug Power, Hyundai Mobis, Toyota, Ballard and Panasonic. American company Plug Power is the largest worldwide, with a market share of more than 20 percent.
In the domestic front, the leading suppliers include SinoHytec, Sinosynergy, Kensino, EEMT, SHPT, Foresight Energy and FTXT Energy.
