Hydrogen is widely used for its chemical properties in a range of industrial applications. Fuel cells that use direct hydrogen are opening up a new business opportunity for hydrogen suppliers - one with potentially high demand if some key markets take off. The key direct hydrogen fuel cell applications that are currently seeing traction are light duty vehicles, forklifts, buses, stationary power, and scooters. These fuel cell market present different infrastructure buildout pathways, with varying opportunities and challenges.
According to a new report from Pike Research, as a result of this infrastructure investment, more than 5,200 hydrogen fueling stations for cars, buses and forklifts will be operational worldwide by 2020, up from just 200 stations in 2010. The cleantech market intelligence firm forecasts that, by the end of that period, annual investment in hydrogen stations will reach $1.6 billion, with a cumulative 10-year investment totaling $8.4 billion. The increased utilization of hydrogen as a fuel will drive annual demand from approximately 775,000 kilograms (kg) in 2010 to 418 million kg by 2020.
"There is no one clear business model for the hydrogen infrastructure market at present," says senior analyst Lisa Jerram. "Currently, the major players in hydrogen fueling are large multinationals: the industrial gas companies, and the energy and gas companies, both those that operate retail gas stations and those that provide fuels for the grid. These companies tend to favor large-scale hydrogen infrastructure options."
Jerram adds that some smaller "independent" hydrogen suppliers that are developing and marketing smaller onsite hydrogen generator technologies could offer a more modular path to hydrogen infrastructure buildout. Yet another pathway is presented by vehicles using very small quantities of hydrogen, such as scooters. These vehicles can be fueled by small solid state hydrogen cartridges, which are readily distributed in retail outlets.
Pike Research's analysis indicates that forklifts will be the largest driver of hydrogen fuel demand by 2020, representing 36% of the total market by that time. The other large application categories include light duty vehicles, which will consume 33% of total hydrogen, and uninterruptible power supplies (UPS) for stationary power, which will represent 27% of the total. Fuel cell buses and scooters will each be a relatively small percentage of total hydrogen demand.
Pike Research's report, "Hydrogen Infrastructure", analyzes the dynamics of global demand for hydrogen fuel and the infrastructure investments that will support fueling stations for fuel cell light duty vehicles, buses, forklifts, scooters, and stationary power applications. The study includes an examination of market issues, technology issues, and the competitive landscape within the hydrogen infrastructure industry. Market forecasts for hydrogen demand and fueling infrastructure, segmented by application and geography, are provided through 2020.