100% renewable targets will require power storage to manage flows on the net
Electrolysers utilise these intermittent power flows to produce H2 gas from water
H2 gas can be stored in large quantities underground and transported via existing gas pipelines
H2 vehicles recharge faster and are more durable than battery powered transport
Growing H2 demand in industrial processes will reduce costs and increase supply

The EHA continues its weekly Climate Briefs this year with a quick overview of the latest developments in energy and transport transitions in Europe and beyond.

Energy:

As the EU Council adopted legislation on the internal market to stop subsidies for coal plants just before Christmas (see COM2016/0861), Germany is still going ahead with new coal plants that have already started construction or just put in operation (see for list here). It’s last black coal mine was put out of service one the last working day before the EU Christmas break by the EU president himself (see Photo courtesy) .

As a warming up; the beginning of the year saw some amazing storage contracts issued by the Hawaiian Electric Company at record-low storage prices for the state, under 10 $cents per kilowatt-hour meaning a 42% drop compared to 2016-2019 prices according to Wood Mackenzie Power & Renewables; a 90 MW of solar and 360 MWh of storage came in at  8 $cents per kilowatt-hour. The projects awaiting regulatory approval, add 262 MW of solar and 1,048 MWh (now 75MWh) of storage to provide power “in place of volatile prices of fossil fuels,” quoted at about 15 cents per kilowatt-hour. US storage to date totals around 1,4GWh. Taken together, the projects would also rank as the second-largest storage announcement ever, just behind the recently approved Moss Landing project in California.

Transport:

Ahead of a ZEV Alliance meeting in China  a number of EV  reports came out with figures on the Chinese electric vehicle market.

The China New Energy Vehicle NEV regulation came into force on January 1, 2019, where car companies can get credits for producing, not selling!, (fuel cell and plug in) electric vehicles for the Chinese market. This translated already into 601.000 EV, of which 5000 FCEV, sold until Q3 2018 on a total production of 22.6 mln cars. China saw initial FCEV developments on FC buses in Wuhan province at the University of Wuhan. The city of Yunfu in Guangdong province has already established an 134 sqkm industrial park on fuel cells in 2009. According to recent IEA figures China has spent 12,4bln to date on FCEV development and will continue to do so till 2025 with per FCEV contributions of up $30.000 .  This has helped to reach the target of 5.000 by 2020 already in 2018.

The end of last year Weichai Power bought 20% of Ballard to support production of 2000 fuel cells for commercial vehicles by 2021. They also have a  stake of 20% in UK’s Ceres Power. China pushes for 2 mln FCEV, 5% of its fleet, by 2030, (US and Japan both 800.000). The IEA reports that 8000 FCEV were sold globally until April 2018 of which half in the US.  As for hydrogen production in China, 150GW of renewable power that is “not used directly”, that could fuel 18mln FCEV per year, is waiting for electrolysers….

A total of $58.8 bln has been spent on electric vehicles while subsidies for battery cars will phase out in 2020. Under the NEV “cap and trade” system, any company that makes 30,000 cars or more needs to earn enough credits to match 10% of its output. So a car company manufacturing the minimum would need to earn 3,000 credits. A NEV can receive between two and six credits depending on how far it can travel before being recharged; an FCEV is receiving 5 credits. So if a carmaker makes 30,000 cars, it could hit its quota by manufacturing 600 FCEV while a BEV producer with three credits would have to produce 1000 BEC to reach the quota of 10%.

A 2018 ICCT report on the NEV policy indicated that “depending on the NEV technology path that manufacturers choose, the rule would require production of 2.2 million to 8.7 million new energy passenger cars in 2016-2020( including PHEV with only two credits, , EHA). Based on our best estimates of the electric range of passenger electric cars, we estimate ~3 credits per vehicle. This means that China’s NEV share of new passenger vehicle sales will go from about 1% in 2016 to roughly 2% in 2017, then about 3% in 2019 and 4% in 2020. Annual NEV sales in 2016 totalled 340.000. Combined with NEVs in the commercial sector, the Chinese government would achieve its cumulative target of 5 million NEV sales in 2020. ” In case of a 8.7 mln NEV by 2020 this would translate in a production of 3.7 mln NEV for export…..

The global number of electric and plug-in hybrid cars  and private charging stations exceeded 3 million in 2017 (430.000 pubic of which 25% fast chargers), a 54% increase compared with 2016, according to the latest edition of the International Energy Agency’s Global Electric Vehicles Outlook. Nearly 580,000 electric cars were sold in China in 2017 (half of global sales), a 72% increase from 2016. The United States 280,000 cars sold in 2017, up from 160,000 in 2016. Electric cars accounted for 39% of new car sales in Norway, making it the world leader in electric vehicle (EV) market share. In Iceland, new EV sales were 12% of the total while the share reached 6% in Sweden. Germany and Japan also sawsales more than doubling  from  2016 levels as well.  In 2017, the stock of electric buses rose to 370,000 from 345,000 in 2016, and electric two-wheelers reached 250 million. China accounts for more than 99% of both electric bus and two wheeler sales.

As a comparison: Denmark as the first of  EHA country briefs on FCEV and HRS developments and accompanying CO2 figures. Denmark currently has a total of 84 Fuel Cell Electric Vehicles (FCEV) on its roads, according to data gathered on Statistics Denmark, and 10 hydrogen refuelling stations. This has been realised by many FCH JU projects since 2009 along with the TEN-T program since 2012. In April 2018, a report published by Brintbranchen (Hydrogen Denmark)  stated the FCEV distribution in the country, with 62% used by the municipalities whereby the public and private sectors share 18% and 12%, respectively and 8% is owned by households for personal use. The first hydrogen-fuelled cars were deployed in 2013 and mainly used by the municipalities to promote its use. The Mercedez Benz announcement of last November on their launch in 2022 of several FCEV models is pointing to only private use.