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Toyota, California go for hydrogen

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California, the home of Elon Musk and his Tesla venture, is about to embark on another technological initiative as well — a car driven entirely by hydrogen.

In late February Toyota began producing and selling the Mirai (the name means “future”), a hydrogen-powered vehicle that will be available in Tokyo this year and go on sale in the U.S. in December. Always conscious of its history and ready to make amends, Toyota made the announcement five years to the day after it testified before Congress about a sudden accelerator problem that caused the company a great deal of embarrassment and led to a recall. “Every Feb. 24, we at Toyota take the opportunity to reflect on the recall crisis, doing everything we can to ensure its lessons do not fade from memory,” company CEO Akio Toyoda said. “For us, that date marks a new start.”

To say that Toyota is being cautious in entering the hydrogen car market would be an understatement. The Mirai won’t even be mass-produced but is being hand-crafted by Japanese workers who are turning out three cars per day. The model will sell for $57,000 in Tokyo and is not designed to take off like a rocket. The company only plans to sell 2,000 individual models in Japan this year. “The Mirai program, especially once all the research and development costs are factored in, is clearly unprofitable at this point, and even selling a few thousand units at $57,500 each is not going to turn the tide,” the Motley Fool’s Alexander MacLennan wrote. “But the Mirai is not about short-term profits; it’s about long-term market advantage through brand acceptance and technological development resulting in better vehicles.” Even Japanese Prime Minister Shinzo Abe got into the act, saying we are headed into a “hydrogen era.”

Right now Toyota’s main rival as an alternative to gasoline will be Elon Musk’s all-electric Tesla Model 3. Musk is not taking the challenge lightly. He has called the hydrogen car “an extremely silly idea” and mocked its fuel cells as “fool cells.”

But Musk might have reason to worry. The Mirai will offer drivers a range of 300 miles and take only three minutes to fill its tank. Tesla’s Model 3, due out in 2017, will offer only a 265-mile range and consume 40 minutes to offer an 80 percent recharge of its batteries. (Ideally, EVs should be recharged overnight.) Of course, the big test will be the availability of refueling stations, and here electric vehicles have a big head start. Tesla already has 393 Supercharging stations nationwide and is building them out as fast as possible.

There are only a dozen hydrogen stations now, all of them in California, as a result of Gov. Arnold Schwarzenegger’s “hydrogen highway” initiative of 2004. But California has seized the gauntlet again and is promising to spend another $20 million in building out the Hydrogen Highway with 28 new stations in the next few years. The Mirai will be initially aimed exclusively at California and its requirements for zero-pollution vehicles, then try to expand to the East Coast as well. Hyundai’s hydrogen-powered Tucson is already being sold in California.

Where Toyota and Tesla have found agreement is in opening up their patents to rivals to try to promote the technology. Musk famously made his EV patents available last year, and now Toyota is doing the same with its hydrogen research. The obvious aim is to get other manufacturers involved in order to increase the demand for fuel outlets. “We think this is a different way to look at the market and collaborate and hopefully with this get a lot more people coming into the game,” Nihar Patel, Toyota’s vice president of North American business strategy, told Forbes.

Still, the switch to hydrogen vehicles has some challenges ahead. Musk’s main criticism — echoed by many others — is that hydrogen fuel is too difficult to handle and transport. Hydrogen is, after all, the smallest molecule and leaks through everything. One of its biggest critics is Joseph Romm, who worked in the Clinton administration promoting the technology and finally became so disillusioned that he wrote a book critical of the technology called The Hype About Hydrogen. Romm is now a senior fellow at the left-leaning Center for American Progress and heads the Climate Progress blog. Another problem with hydrogen, of course, is that it is not available as a free resource but must be manufactured from other resources, principally natural gas. This, of course, requires costs and energy.

Still, hydrogen vehicles have the advantage of producing no air pollution (its exhaust is water vapor) and will be able to reduce the release of carbon into the atmosphere, since the CO2 is easily captured in the reforming process. Overall, hydrogen is likely to be a big plus for the environment.

It also offers car buyers what may be the most important factor in reducing our foreign oil dependence — free choice. It hardly matters if electric vehicles prove to be more popular than hydrogen vehicles or vice versa. The important thing is that they will both be available as alternatives to gasoline-powered cars. They could also open up the door to other alternative fuels: compressed natural gas, E85, and the dark horse of them all, methanol manufactured from natural gas. All these alternatives cannot help but make a dent in our current dependence on foreign oil.

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Japan bets big on hydrogen fuel cells

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Remember when Japan’s Ministry of Economy, Trade and Industry (METI) used to sit atop the Japanese industrial complex, steering it like some giant Godzilla hovering over the entire world?

Those were the days when Japan’s government-industry partnership was supposed to represent the future, when Michael Crichton wrote a novel about how Japan would soon devour America, when pundits and scholars were warning that we had better do the same if we hoped to survive – before, that is, the whole thing collapsed and Japan went into a 20-year funk from which it has never really recovered.

Well those days may be returning in one small part as METI prepares to direct at least half the Japanese auto industry into the production of hydrogen-powered fuel-cell cars.

“Japanese Government Bets the Farm on Fuel Cell Vehicles” ran one headline earlier this month and indeed there’s plenty at stake for everyone. The tip-off came at the end of May when Jim Lentz, CEO of Toyota’s North American operations, told Automotive News that electric vehicles are only “short-range vehicles that take you that extra mile…But for long-range travel, we feel there are better alternatives, such as hybrids and plug-in hybrids, and, tomorrow, fuel cells.” The target here, of course, is Tesla, where Elon Musk appears to be making the first inroads against gasoline-powered vehicles with his $35,000 Model E, aimed at the average car buyer. Toyota was originally in on that deal and was scheduled to supply the batteries until it pulled out this spring, ceding the job to Panasonic.

But all that was only a preview of what was to come. In early June, METI announced it would orchestrate a government-private initiative to help Toyota and Honda market fuel-cell vehicles in Japan and then across the globe. Of course that leaves out the other half of Japan’s auto industry, Nissan and Mitsubishi, pursuing their version of the EV, but maybe the Japanese are learning to hedge their bets.

The hydrogen initiative will put the fuel-cell vehicle front-and-center in the race to transition to other forms of propulsion and reduce the world’s dependence on OPEC oil. Actually, hydrogen cars have been in the offering for more than twenty years. In the 1990s soft-energy guru Amory Lovins put forth his Hypercar, a carbon-fiber vehicle powered by hydrogen fuel cells. In 2005, California Gov. Arnold Schwarzenegger inaugurated the “Hydrogen Highway,” a proposed network of hydrogen filling stations that was supposed to blanket the Golden State. Unfortunately, only ten have been built so far, and there are still no more than a handful of FCVs (hydrogen fuel cell vehicles) on the road. Mercedes, BMW, Audi and VW all have small lines but none are marketed very aggressively in the United States.

This time, however, there may be a serious breakthrough. After all, Toyota, Honda and METI are not just in the business of putting out press releases. Toyota will begin production of its first mass-market model in December and Honda will follow with a 5-passenger sedan next year. Prices will start in the stratosphere — close to $100,000 — but both companies are hoping to bring them down to $30,000 by the 2020s. Meanwhile, GM is making noises about a fuel-cell model in 2016 and South Korea’s Hyundai is already unloading its hydrogen-powered Tucson on the docks of California.

What will METI’s role be? The supervising government ministry promises to relax safety standards, allowing on-board storage of hydrogen at 825 atmospheres instead of the current 750. This will increase the car’s range by 20 percent and bring it into the 350-mile territory of the internal combustion engine. Like the ICE, hydrogen cars can “gas up” in minutes, giving them a huge leg up on EVs, which can take anywhere from 20 minutes with superchargers to eight hours with household plugs. METI has also promised to loosen import controls so that foreign manufacturers such as Mercedes-Benz can find their way into Japan. And, of course, it will seek reciprocal agreements so Toyota and Honda can market their models across the globe.

So will the one-two punch of government-and-industry-working-together be able to break the ice for hydrogen vehicles? California seems to be a particularly ripe market. Toyota is already the best-selling car in the state and the California Energy Commission is promising to expand the Hydrogen Highway to 70 stations by 2016. Still, there will be stiff competition from Elon Musk if and when his proposed Gigafactory starts turning out batteries by the millions. Partisans of EVs and fuel-cell vehicles are already taking sides.

In the end, however, the most likely winners will be consumers who will now have a legitimate choice between hydrogen vehicles and EVs. It may be a decade or more before either of these technologies makes a significant dent in our oil consumption, but in the end it will be foreign oil providers that will be feeling the pain.