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Hydrogen costs must fall to reach diesel parity – study

Hydrogen fuel-cell buses (FCEBs) and battery-electric buses (BEBs) are still slightly more expensive to operate than diesel equivalents, according to a study by San Francisco’s public transit authority, the Alameda-Contra Costa Transit District (AC Transit).

The research for the study was carried out by AC transit during the Covid-19 pandemic and was published it for the benefit of other fleet operators.

“AC Transit currently operates all five propulsion technologies and is uniquely positioned to support this rigorous study,” says General Manager Michael Hursh. “The propulsion metrics are not cobbled from several sources but instead one agency, with roadway testing on the same routes and in the same service environment.”

“AC Transit currently operates all five propulsion technologies and is uniquely positioned to support this rigorous study” Hursh, AC Transit

Diesel buses were the cheapest to operate on a cost-per-mile (CPM) basis, at $0.93 per mile, during the period of the study—carried out over six months in 2020—compared with $1.39 per mile for BEBs and $1.51 per mile for FCEBs, before the application of any credits. But FCEBs were comparable with diesel on maintenance costs, with hydrogen fuel costs being the key component that pushed prices up.

“Hydrogen fuel currently has a high cost, which significantly raises the CPM for the fuel-cell bus fleet,” says the report. “It is expected that, as the market continues to expand, the cost of hydrogen fuel may decrease, lowering the CPM to a more favourable position.”

Hydrogen fuel costs

Fuel costs for HCEBs over the period were two-and-a-half times higher than diesel costs, at $107,137 compared with $43,017. The authority paid an average of $7.79/kg for hydrogen during the study period.

The US government’s hydrogen ‘earthshot’ scheme hopes to reduce the costs of green hydrogen to $1/kg in the next decade.

But, during the period, the FCEB had the highest fleet mileage of any technology, at 112,233 miles—indicating a high level of reliability.

Hydrogen vehicles could reach cost parity with diesel vehicles very shortly depending on geographical location, according to speakers at a PE Live event on the use of hydrogen in haulage.

Hyzon Motors CEO Craig Knight told the event that, in some parts of the world, hydrogen vehicles are already at parity with diesel vehicles on a total-cost-of-ownership basis.

In most of the US, hydrogen costs need to be at $4/kg or below for parity to be reached.

As soon as cost parity is reached, the road transport sector could see a tipping point where investment flows suddenly start to move away from infrastructure and vehicles based on the internal combustion engine model.


Author: Tom Young