Twenty years ago, Toyota took the automotive industry by surprise with the Prius.

The Japanese giant is attempting to revolutionize driving again, this time by bringing hydrogen-powered cars to the masses.

However, it now faces a completely different set of challenges than when it set out to get drivers hooked on hybrids.

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By far, the biggest hurdle standing in the way of hydrogen cars is the near-complete lack of a global infrastructure through which to distribute the fuel.

In Japan, an energy group named Iwatani is beginning to build a network of refueling stations, but the process is time-consuming and expensive.

Japanese regulations classify hydrogen as an industrial gas, so the refueling stations need to comply with strict safety regulations.

Hydrogen station in Ebina City, Japan

Hydrogen station in Ebina City, Japan

Iwatani consequently spends about 500 million Japanese yen (roughly $4.5 million) to build each station, according to the Financial Times (subscription required), which is more than twice the cost of an equivalent site in the United States.

The British financial newspaper's coverage, in fact, neatly summarized the many challenges of rolling out hydrogen fuel-cell vehicles in volume.

The Japanese government is aware of the costly fueling-station problem, and it’s taking measures to bring that price down by 2025. Prime minister Shinzo Abe has pledged that the country will build an international hydrogen supply chain that extends from production to transportation and consumption.

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Government intervention is necessary, because few private companies are willing to risk investing in a network of hydrogen refueling stations on their own until the technology becomes more widespread.

However, few motorists are willing to drive a hydrogen-powered car daily until the infrastructure improves, unlike hybrids, which delivered far higher fuel efficiency but otherwise fueled and traveled just like a conventional gasoline car, putting no limits on the behavior of drivers.

Sourcing hydrogen is another major obstacle. Pure hydrogen isn't found naturally on Earth, and making it is both costly and highly energy-intensive.

2017 Honda Clarity Fuel Cell, Santa Barbara, CA, March 2017

2017 Honda Clarity Fuel Cell, Santa Barbara, CA, March 2017

Iwatani makes it by burning natural gas, while the Australian government is attempting to create large amounts of it by combusting brown coal. If the project is successful, Australia hopes to export its hydrogen to nations like Japan.

It remains entirely unclear if hydrogen fuel, even delivered in volume across a national network of fueling stations, will be price-competitive with gasoline on a per-mile-driven basis.

First Element Fuel in the U.S., for example, charged $20 for enough hydrogen to drive 60 to 75 miles when we refueled a Honda Clarity Fuel Cell two weeks ago.

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Finally, a hydrogen powertrain remains expensive to develop and build. The Toyota Mirai’s hydrogen storage tanks are made out of carbon fiber, and the on-board fuel cell that generates electricity uses platinum.

The high costs are passed on to consumers, which explains why the Mirai costs $57,000 before incentives are factored in. Costs need to drop significantly before hydrogen reaches the mainstream.

Toyota remains optimistic, and it expects to sell about 30,000 hydrogen-powered cars annually by 2020. That’s 10 times more than the number it plans to sell this year.

2017 Honda Clarity Fuel Cell, Santa Barbara, CA, March 2017

2017 Honda Clarity Fuel Cell, Santa Barbara, CA, March 2017

Company officials hope to have a full fleet of hydrogen-powered cars and buses on the road by the time Tokyo hosts the 2020 Olympic Games. They’ll take athletes and VIPs from the Olympic village to the various venues.

The massive exposure from such a high-profile international event could speed up the adoption of hydrogen vehicles, so overcoming the teething problems in a timely manner is crucial if Toyota wants to repeat the Prius’ success.

 [EDITOR'S NOTE: Green Car Reports thanks our tipster, who prefers to remain an International Man of Mystery.]

— Ronan Glon


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