The Tokyo Metropolitan Government’s decision to double its budget for hydrogen-related initiatives in fiscal 2024 reflects a strategic move towards combatting climate change.
While the focus has historically been on supporting fuel cell vehicles (FCVs) and hydrogen fueling stations, the spotlight is now shifting towards promoting the adoption of hydrogen fuel cell-powered commercial vehicles, particularly large trucks. But will this initiative pave the way for widespread hydrogen adoption?
In February this year, a public-private working group convened to address challenges hindering the proliferation of hydrogen fuel cells. With major industry players onboard, including Toyota Motor Corp. and Eneos Corp., the Tokyo government expressed its commitment to accelerate the use of hydrogen-based energy, emphasizing its potential in addressing energy crises and climate change.
Despite hydrogen’s promise as a next-generation energy source, logistical challenges persist. High hydrogen prices, coupled with the limited number of hydrogen stations and the steep cost of FCVs, pose significant barriers to widespread adoption. Moreover, Japan’s hydrogen infrastructure remains nascent, with only 181 hydrogen stations as of May 2023, lagging behind electric vehicle infrastructure.
In a bold move, the Tokyo government has doubled its budget for hydrogen-related projects, allocating ¥20.3 billion for fiscal 2024. A significant portion of this budget will support the purchase of large hydrogen-powered trucks and provide fuel subsidies to bridge the price gap with diesel. Additionally, funds will be allocated for retrofitting existing hydrogen stations to accommodate large commercial vehicles.
Recognizing the slow uptake of FCVs in the passenger car segment, Tokyo is pivoting towards commercial vehicles. By targeting subsidies and infrastructure development for commercial hydrogen-powered trucks, the metro government aims to catalyze demand and drive market growth. This strategic shift acknowledges the rapid adoption potential and substantial market size within the commercial sector.
While cost remains a primary concern for hydrogen adoption, industry representatives welcome Tokyo’s support as a significant boost. They envision the widespread adoption of commercial hydrogen vehicles as a catalyst for technological advancement, paving the way for cost reductions and streamlined development across the sector.
