“Hydrogen powered trucks could be competitive with diesel as early as 2030, given the right policy support”

Power station hydrogen energy storage battery with solar plant and wind turbine. 3D illustration

Hydrogen powered trucks could be competitive with diesel as early as 2030, given the right policy support, according to a new White Paper from the H2Accelerate collaboration 

The H2Accelerate collaboration published the third in its series of white papers in support of the use of hydrogen in long-haul trucking in Europe. This milestone white paper articulates the likely evolution of fuel cells truck operating cost and uses this to define the policy support which will be required to underpin the transition to an economically viable fuel cell trucking system for Europe. 

“Once the fuel cell truck market has scaled up, the cost of operating fuel cell vehicles is expected to decrease so that a combination of RED II credits, diesel excise tax, additional carbon tax on road fuels, and differential road tolls can be used to improve the ownership cost of fuel cell trucks beyond that of diesel trucks” 

The paper follows the publication of three previous white papers last year, the first on the need for hydrogen trucking and the second on expectations for the fuel cell truck market. The paper builds on the deployment phases and policy support mechanisms outlined in the previously published white paper, providing specific and quantified policy recommendations for each stage of hydrogen trucking development. 

Total Cost of Ownership (TCO) Analysis 

The H2Accelerate collaboration has been formed by truck manufacturers Daimler Truck, IVECO, and Volvo Group, and hydrogen infrastructure providers Linde, OMV, Shell, and TotalEnergies. The central objective of the collaboration is to create awareness of the benefits of the use of green hydrogen for trucking, and the challenges in scaling-up the sector up to and beyond 2030. The deployment of hydrogen trucking must start now and ramp-up quickly if the ambitious emissions reductions targets of net-zero by 2050 are to be achieved, to allow the sector to scale-up green hydrogen and truck production volumes, and cost reductions to be realised. 

Paul Bogers, Vice President of Hydrogen at Shell, said of the latest white paper: “Together with our H2Accelerate co-members, Shell is prepared to invest in the development of a pan-European Hydrogen heavy-duty refuelling network to enable decarbonization of commercial road freight. With the right policy measures in place and synchronizing customer demand and vehicles with safe and reliable supply of Hydrogen, it will become a cornerstone of building the zero-emission transport system that Europe needs.” 

The previous white paper identified three deployment phases over the coming decade before full industrialisation is achieved. The milestone white paper outlines the expected total cost of ownership of operating a fuel cell and diesel truck through time for each of these deployment phases, building on the analysis previously undertaken by Roland Berger for the FCH JU. 

The collaboration members envisage a transition through a first “learning” phase pre-2025, when low hundreds of trucks are deployed at a relatively high cost (due to low volumes) through a series of expansions producing 1,000s and then 10,000s of trucks per year to a full industrialisation phase, when only a slight cost increase is observed in the central case. The analysis suggests the prospect of lower ownership costs compared to diesel if certain cost and performance metrics for hydrogen and fuel cell vehicles can be achieved. 

Policy support for fuel cell trucks 

Despite drastic expected reductions in TCO as the scale of fuel cell truck deployment increases, technological improvements are made, and economies of scale are achieved, policy support that is appropriately structured to align with the needs of each phase of the rollout will be required. 

As secretariat to the H2Accelerate collaboration, zero carbon consultancy Element Energy has analysed different options for these policy and regulatory measures, building on the recommendations set out in the recent ‘Fit for 55’ package. 

Director at Element Energy and H2Accelerate spokesperson Ben Madden said of the latest white paper release: “Truck and station manufacturers are ready and willing to invest in hydrogen trucking. Our analysis clearly shows however that this alone will not be sufficient if long-haul trucking is to contribute to achieving net-zero by 2050. State support is critical to achieving the cost reductions needed to enable customers to purchase hydrogen trucks in meaningful numbers.” 

Whilst the previous white paper outlined the types of subsidies required at each stage of the rollout (e.g., capital subsidy for ‘project’ type funding in the early stages), this paper quantifies specific policy measures that (if implemented together) will create the conditions for a thriving hydrogen truck market for Europe. The proposed policy measures include: 

  • • Member state implementation of a favourable RED II framework for hydrogen is essential. In addition, within the RED III proposals, a long term and appropriately ambitious transport sub-target for renewable fuels of non-biological origin (RFNBOs) (which will treat green hydrogen in the same way “advanced biofuels” are already treated) will help create and sustain the business case for green hydrogen production and the associated hydrogen refuelling stations. 
  • • Introduction of differential road tolls to favour hydrogen and other zero emission options over fossil fuel-based vehicles. The modelling suggests road tolls of €0.40/km for diesel vehicles and €0.10/km for zero emission vehicles would be sufficient to create demand for hydrogen trucks. 
  • • Taxation of fuels which recognises the changing landscape towards more decarbonised and zero carbon fuels and zero emission vehicles, which does not disadvantage hydrogen and other sustainable fuels until their business case is established. 
  • • A carbon tax on diesel applied through the new ETS system proposed in the Fit for 55 package, in addition to the excise tax currently applied on diesel today. 

The full white paper can be downloaded from the H2Accelerate website. 

About H2Accelerate 

H2Accelerate is a collaboration agreement signed between the participants under which the participants will work together to: 

  • • seek public support to fund early pre-commercial projects to activate the market on the path towards a mass market roll-out; 
  • • communicate around the technical and commercial viability of hydrogen fuelled trucking at scale; and 
  • • hold discussions with policymakers and regulators to encourage policies which can support a sustainable and speedy activation of the zero emissions long haul trucking market. 

You can follow the H2Accelerate collaboration on Twitter (@H2AccelerateEU).