Why is California wasting millions on hydrogen fuel pumps?

Battery EVs have won the clean car race, so bankrolling a major buildout of hydrogen infrastructure seems foolish.

A worker in a green coat stands on a ladder servicing a blue hydrogen fuel pump in a wooded area
A technician works on a very pricey hydrogen fuel pump that has been under construction for six years at a filling station in Woodside, California. (Eric Wesoff)
  • Link copied to clipboard

In 2016 I reported on the construction of a $2.8 million hydrogen pump for fuel-cell electric vehicles at my local gas station.

It’s now 2022, and nearly 2,000 days later, that pump has yet to commercially dispense a single molecule of hydrogen, according to a technician working on the pump and an employee at the gas station, both of whom I interviewed recently. I used to live just a few hundred yards from this particular pump on Skyline Boulevard in Woodside, California, a mountain road with epic views that attracts motorcyclists, hikers and cyclists in droves.

The growth trajectories of battery electric vehicles and fuel-cell vehicles have diverged dramatically in those intervening six years. Battery EVs are rapidly becoming mainstream. Fuel-cell cars are just as niche as ever, and the infrastructure to support them is still very limited and very expensive. 

Subscribe to receive Canary's latest news

In the race to become the clean cars of the future, fuel-cell models are the decisive losers. So why is the state of California still squandering tens of millions of dollars on this technology? 

Our zero-emissions-vehicle future

Fuel-cell vehicles use hydrogen as a fuel source and produce zero emissions at the tailpipe, just water vapor and heat. 

The California Energy Commission (CEC) has invested nearly $166 million and plans to invest a total of $279 million through its Clean Transportation Program to build a network of more than 100 hydrogen filling stations to support the increasingly unlikely surge of zero-emissions fuel-cell electric cars. 

As of October 22, 2021, there were 52 open retail hydrogen refueling stations in California, funded by the Clean Transportation Program, the Volkswagen Mitigation Trust Fund and the private sector. Funding for the CEC program comes from vehicle-registration surcharges and smog check and license plate fees. There is only one hydrogen station in the other 49 states, in Honolulu, Hawaii, according to the U.S. Department of Energy.

CEC funding for hydrogen infrastructure has gone to a number of private companies, including Air Liquide, FirstElement Fuel, HyGen Industries, Institute of Gas Technology, ITM Power, Linde, and Hydrogen Technology & Energy Corporation (HTEC).

HTEC built my local hydrogen pump and is the recipient of CEC funding totaling $2,125,000 of the total $2.8 million needed to remodel the existing gas station to support a daily hydrogen capacity of approximately 100 kilograms, according to public records. (A Toyota Mirai fuel-cell EV holds 5.6 kilograms in its storage tanks.) The station is supposed to receive deliveries of hydrogen gas, as well as generate its own hydrogen with a small on-site electrolyzer. The CEC will also provide a subsidy of up to $100,000 per year for three years to help cover station operations and maintenance costs.

I reached out to Colin Armstrong, CEO of British Columbia–based HTEC, to confirm whether the pump is not yet operable and find out why it was taking so long. He responded via email: We are excited that we are again making progress at the Woodside Station. Currently, we are performing required maintenance and evaluating a timeline to become operational. This was HTEC’s first station, and as with any new venture, the station faced common operational hurdles, which we have been able to address. […] Having now built several stations in Canada, we are well-prepared to focus on the Woodside station and get it operational as soon as possible.”

When the pump finally becomes operational, the hydrogen fuel it will sell may not even be that clean. According to the CEC, Hydrogen sold through refueling stations funded by the CEC must be 33 percent renewable,” meaning produced from biogas or from water electrolysis using renewable energy sources. Put another way, hydrogen in the clean transportation program can be 67 percent dirty.

Do the math

The CEC states on its website that hydrogen fuel-cell electric vehicles are critical to the state’s goal of getting 1.5 million zero-emission vehicles on California roads by 2025.” But the CEC is dead wrong on this point; the state will easily meet the CEC goal with battery EVs alone. As of December 2021, cumulative plug-in car registrations in the state since 2010 totaled 1.072 million units. As of February 1, 2022, there are only 12,456 fuel-cell vehicles in the entire country, according to the California Fuel Cell Partnership. 

Tesla alone delivered over 936,000 battery EVs worldwide in 2021. Tesla CEO Elon Musk has derided hydrogen fuel cells by calling them fool cells” as well as mind-bogglingly stupid.” 

At least 10 automakers have announced plans to switch their offerings over completely to battery-powered electric vehicles, while there are only two models of hydrogen cars currently available: the Toyota Mirai and the Hyundai Nexo. There is little evidence that any automaker is gearing up to mass-produce fuel-cell-powered cars other than small-scale pilot runs and compliance cars.” Analysts at LMC Automotive predict that fuel-cell vehicles will make up only 0.2 percent of the global passenger car market share by 2027

The CEC has been aiming to get 100 hydrogen stations up and running since 2014, when battery EVs had a global market share of 0.41%. The market has changed enormously since then. Battery EVs made up 8.6% of all new car sales in 2021, a year when global sales hit 6.6 million, according to the International Energy Agency and illustrated in a recent Canary Media Chart of the Week.

While the CEC has only managed to make it halfway to its modest goal for hydrogen stations, EV charging infrastructure has proliferated wildly in recent years. As of January 2022, the U.S. had close to 109,000 charger ports for plug-in electric vehicles, with California claiming almost 34,000 public and private chargers. 

The comparison of costs for EV chargers versus fuel-cell stations is just as stark. These initial hydrogen refueling stations are costing California from $1 million to $2.1 million each. Contrast that with Level 2 EV charging stations costing $400 to $4,500, or $28,000 to $140,000 for DC fast chargers.

Battery EVs have already won in California, the U.S. and the world. It’s not even a contest. And while a hydrogen distribution system does not yet exist, EVs already have a refueling network in place — it’s called the electrical grid.

Hydrogen’s moment in the sun

Hydrogen is having a moment in the 2020s. Entrepreneurs, venture firms, oil and gas companies, and state and federal governments are aligning to fund, innovate and deploy cleaner generation of this element as an energy carrier (or in the case of the oil and gas firms, greenwashing their way to a longer fossil-fuel runway).

The U.S. federal government intends to spend $8 billion to kick-start construction of the first​“clean hydrogen hubs” in the U.S., as Jeff St. John recently reported for Canary Media. Clean hydrogen is expected to play a role in cutting emissions from hard-to-decarbonize industries such as ammonia, shipping and steel.

But when it comes to powering cars, hydrogen production is still an inefficient, energy-intensive process, particularly when compared to generating electricity for direct use in plug-in cars. A new study published in the peer-reviewed journal Nature Electronics finds that technical and economic developments in battery and fast-charging technologies could soon make fuel cell electric vehicles, which run on hydrogen, superfluous in road transport.”

The study also finds that battery and charging advances will obviate the advantage that fuel-cell vehicles are presumed to have in long-haul logistic operations and the road transport of very heavy goods.

Despite mounting evidence like this, the iffy thermodynamics of the hydrogen molecule’s supply chain, and the outlandish cost of establishing a distributed hydrogen fueling infrastructure, California is still trying to build a hydrogen pump network. Chalk it up to bureaucratic inertia and the difficulty of canceling a funded program run by salaried civil servants. 

The economics and efficiency of hydrogen fuel cells haven’t changed that much since Chris Nelder made a stark prediction 15 years ago, and his conclusion still holds: You will never drive a hydrogen-fueled car.”

Eric Wesoff is the editorial director at Canary Media.