TABLE 6.5 Type of Hydrogen Supply over Time

Case 1 (Hydrogen Success)




No. of cars served (percentage of total fleet)

1.8 million (0.7%)

61 million (18%)

219 million (60%)

Infrastructure capital cost

$2.6 billion

$139 billion

$415 billion

Total no. of stations

2,112 (all on-site SMR)

56,000 (40% on-site SMR)

180,000 (44% on-site SMR)

No. of central plants


113 (20 coal, 93 biomass)

210 (79 coal, 131 biomass)

Pipeline length (miles)




Hydrogen demand (tonnes per day)

1,410 (100% NG)

38,000 (22% NG, 42% biomass, 36% coal with CCS)

120,000 (31% NG, 25% biomass, 44% coal with CCS)

NOTE: NG = natural gas.

“steady-state” hydrogen infrastructure to serve the demands in 2020, 2035, and 2050 are estimated in Table 6.5. Note that more than $400 billion is required to build the hydrogen infrastructure to supply the fuel for the HFCV fleet in 2050.

Investment Costs for Hydrogen Fuel Cell Vehicles to Reach Cost Competitiveness

Examining the annual cash flows reveals the total investment required for hydrogen HFCVs to reach “breakeven” with gasoline ICEVs. These are shown in Figure 6.13:

  • The “CAP COST Diff” (dollars per year) is the difference in vehicle price for a gasoline vehicle versus a hydrogen vehicle, summed over all the new HFCVs sold that year. This starts out negative (HFCVs cost a lot more than gasoline vehicles), but small (only a few HFCVs are sold). In the longer term, the annual cost difference continues to grow, as HFCVs are assumed to always cost more than gasoline cars.

  • “FUEL COST Diff” (dollars per year) is the annual difference in fuel costs for HFCVs (counting all HFCVs currently in the fleet) compared to what would have been paid to fuel comparable gasoline-fueled vehicles. Hydrogen soon becomes less costly as a fuel on a cents-per-mile basis, so this difference becomes positive around 2017.5 This analysis

FIGURE 6.13 Cash flows for Case 1.

assumes that for a new fuel such as hydrogen with a small HFCV fuel tank (approximately 5 to 8 gallons of gasoline equivalent), consumers would value fuel on a cost-per-mile traveled basis (dollars per mile) rather than a cost-per-gallon-equivalent basis, as they do now for gasoline.

  • “TOTAL Diff” (dollars per year) is the cash flow, which equals the economy-wide cost per year of pursuing a fuel cell market introduction plan. The cash flow is defined


Hydrogen fuel becomes cost competitive with gasoline (on a cents-permile basis) in about 2017, when hydrogen costs are still fairly high, about $5.60/kg. This is because the hydrogen vehicle is assumed to have a fuel economy 2.0 times greater than the gasoline vehicle, and the gasoline price in the AEO high-oil-price case is $2.80 per gallon. This analysis compares the cost of hydrogen with the price of gasoline. The committee decided this would be the most straightforward comparison because it would be difficult to estimate a price for hydrogen without a model for all its uses in the economy, and it is hard to estimate the cost of gasoline, which depends on many complex factors. Gasoline prices include federal, state, and local taxes. One could argue that hydrogen should be competed against the untaxed gasoline price. However, other alternative fuels such as ethanol are untaxed to encourage their adoption, and the committee decided to give hydrogen the same advantage. It should be noted that much of the revenue raised by gasoline taxes goes to highway maintenance and other necessary functions that continue no matter what type of vehicles travel on them. As discussed in Chapter 7, these revenues will have to be replaced from other sources if alternative fuels remain untaxed. On the other hand, the price of gasoline does not include the cost of externalities that hydrogen is intended to address: CO2 emissions and oil imports.

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