China’s carbon neutral goal: Beijing-led alliance aiming to commercialise hydrogen vehicles vies for state subsidies
- District government aims to commercialise the low-carbon energy source at Daxing International Hydrogen Energy Demonstration Zone
- Hydrogen fuel will still be at a demonstration stage in China until 2024 and the country will focus on breakthroughs to drive down costs, executive of fuel cell system developer says
Thirty kilometres south of central Beijing, a hydrogen business development zone the size of about 300 Olympic swimming pools is under construction in the suburban Daxing district.
The district government wants to turn the Daxing International Hydrogen Energy Demonstration Zone into an innovation base with the aim of commercialising the nascent low-carbon energy source. Already completed and awaiting government approval for commercial operations at the zone is the world’s largest hydrogen refuelling station, with daily throughput capacity of 4.8 tonnes and 16 refuelling guns.
“Daxing is a perfect location for a hydrogen demonstration park, as we have transport hubs around us and major highways pass by our zone, ” Zhao Yuan, the zone’s director, said in an interview.
The development of the zone is significant because of China’s hydrogen fuel cell ambitions. The country had about 7,300 hydrogen fuel cell vehicles at the end of last year, most of them commercial vehicles. It is targeting about between 50,000 and 100,000 such vehicles on its road by 2025, rising to one million in 2035. Moreover, as of March, only 108 hydrogen refuelling stations were in operation in China. Most of them were located in Guangdong and Shanghai, according to a report by industry research provider Qianzhan. Beijing plans to have more than 1,000 such stations in 2025 and 5,000 in 2035.
Located close to the world’s largest airport and the biggest logistics hub of Chinese e-commerce giant JD.com in Beijing, the refuelling station in the Daxing zone can serve up to 600 logistics zero emissions vehicles daily, Zhao said.
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Beijing HyPower Energy Technology, the station’s operator, is among 20 companies in the hydrogen supply chain that will operate in the 360,000 square metre demonstration zone. When completed next month, it will have 54,000 square metres of industrial space, including testing and research and development facilities, some of which will be occupied by start-ups.
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Beijing SinoHytec, a major fuel cell engine system developer that had a 41 per cent market share last year according to Sealand Securities, will have an annual production capacity of 3,000 units. Its first-phase manufacturing facilities are being set up within the zone and commercial operations are expected to start in October.
“Hydrogen fuel will still be at a demonstration stage in China before 2024, and the country will focus on making breakthroughs in core components’ research and development to drive down costs,” said Yu Min, Beijing SinoHytec’s deputy general manager. “That is why we have a limited capacity for the first phase.”
It plans to develop 200 kilowatt (kW) and 300kW high-power engines, upgrades on its current 30kW to 120kW products, he added. This will allow it to cover almost all application scenarios, including heavy-duty tractors for long-distance transport.
“From 2025 onwards, if we can localise all core components and reduce cost to a level competitive with battery-powered electric vehicles, then commercialisation on a limited scale will be possible,” Yu said.
The Daxing-Tianjin-Hebei-Shandong cluster will demonstrate hydrogen fuel cell vehicles at the 2022 Winter Olympics in Beijing, tractors and fork lifts for port operations in Tianjin, and trucks carrying heavy industry materials such as iron ore and steel in Tangshan in Hebei province and Binzhou in Shandong province.
The city clusters are vying to join a four-year demonstration programme, under which up to 1.7 billion yuan (US$259 million) will be given to each selected team of companies, which will comprise component makers to refuelling station operators.
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“No single city can complete all the tasks in the hydrogen supply chain,” said Wang Jin, dean of Guohe InterContinental Energy Consultation Institute. “Each should play to its strengths, from hydrogen production to storage and application.”
The Beijing municipal government announced ambitious five-year development goals for the local hydrogen industry on Monday. It aims to foster five to eight leading companies with “global influence” before 2023, and build 37 hydrogen stations to support 3,000 fuel cell vehicles.
“For Beijing, its strength lies in its scientific research and development capabilities and wide application scenarios,” said Wang.
Has the day finally arrived for green hydrogen and fuel cells in China?
The price of hydrogen at refuelling stations, currently at more than 65 yuan per 100 kilometre, could be cut to 20 yuan in the future, when a mature scaled-up supply chain is set up, according to a report by Everbright Securities.
It could be economically viable if it falls below 14 yuan, which will require cost reductions at every link of the production chain of hydrogen, including electrolysis, transport and refuelling, said Zhao of the Daxing zone.
“Using green hydrogen is a must for energy decarbonisation, but it may take 10 more years before mass commercialisation is realised,” said Zhou Hongjun, professor at College of New Energy and Materials at the China University of Petroleum.
Additional reporting by Eric Ng
