In recent years, China has seen rapid development in the production technology of hydrogen fuel cell stacks and battery systems. The performance of hydrogen fuel cells has been significantly improved and they are now close to the international leading level. Some domestic leading independent brands have made breakthroughs in key technologies and processes, mastered core technologies, and owned intellectual property rights, promoting the localization of more hydrogen fuel cell-related components.
The 'Medium- and Long-Term Plan for the Development of Hydrogen Energy Industries (2021-2035)' clearly states the need to continuously improve the reliability, stability, and durability of fuel cells, support the development of new types of fuel cells and other technologies, and focus on promoting the research, development, manufacturing, and supply of core components and key equipment.
As the core area of the hydrogen fuel cell industry chain, hydrogen fuel cell stacks and systems are bound to see greater development supported by policy dividends and the commercialization and promotion of fuel cells.
01
Definition and Classification of Hydrogen Fuel Cell Packs and Systems
A hydrogen fuel cell system is a power generation device that converts chemical energy into electrical energy through an electrochemical reaction without combustion, producing no pollution during the process. For hydrogen fuel cell vehicles, the hydrogen fuel cell system is the core component of their powertrain, affecting the vehicle's performance, safety, and stability.
The hydrogen fuel cell system mainly includes: 1) hydrogen fuel cell stack; 2) gas circulation system (including air compressor and hydrogen circulation pump); and 3) other auxiliary systems. Among them, the hydrogen fuel cell stack is the core of the hydrogen fuel cell system and is the device for redox chemical power generation. The hydrogen fuel cell stack consists of multiple fuel cells connected in series, with each single cell made up of a bipolar plate and a membrane electrode. The hydrogen fuel cell stack has a crucial impact on the overall performance and cost-effectiveness of the hydrogen fuel cell system.
02
Market scale of hydrogen fuel cell stacks and systems in China
From 2017 to 2021, thanks to the rapid growth in the sales volume of hydrogen fuel cell vehicles in China, the market scale of hydrogen fuel cell stacks in China increased rapidly from 49.6 megawatts to 522.3 megawatts, with a compound annual growth rate of 80.1%. During the same period, the market scale of hydrogen fuel cell stacks in China in terms of shipment value increased from RMB 520 million to RMB 1.25 billion.
Since 2021, with the establishment of hydrogen fuel cell vehicle demonstration city clusters, China's hydrogen fuel cell industry has entered a new growth period. It is expected that the downstream demand for hydrogen fuel cells will continue to grow, which will drive an increase in the shipment volume of hydrogen fuel cell stacks.
In addition, with continuous technological breakthroughs in energy density and operating life, as well as the diversification of hydrogen fuel cell application scenarios, it is expected that the shipment volume of hydrogen fuel cell stacks in China will continue to grow rapidly, increasing from 1,044.1 megawatts in 2022 to 15,044.6 megawatts in 2026, with a compound annual growth rate of about 94.8%.
China's hydrogen fuel cell stack shipments and shipment value
(Predictions for 2017 to 2030)
Source: Analysis by Frost & Sullivan
With the support of national policies, hydrogen fuel cell technology has made significant progress. China has mastered the core technologies of hydrogen fuel cell systems and their key components, and is now capable of developing and domestically producing them.
From 2017 to 2021, the shipments of hydrogen fuel cell systems in China soared from 38.6 megawatts to 405.7 megawatts, with a compound annual growth rate of 80.1%. During the same period, the market scale of hydrogen fuel cell systems in China by shipment value increased from RMB 630 million in 2017 to RMB 2.07 billion.
In the near future, driven by the rapid development of the hydrogen fuel cell vehicle industry and other emerging application scenarios, China's shipments of hydrogen fuel cell systems are expected to reach 12,317.2 megawatts in 2026 and 83,425.6 megawatts by 2030. The compound annual growth rate from 2022 to 2026 is expected to be 97.2%, and from 2027 to 2030 it is expected to be 59.6%. In terms of shipment value, the market size of China's hydrogen fuel cell systems is expected to increase from RMB 3.34 billion in 2022 to RMB 258.7 billion in 2026 and RMB 1168.0 billion in 2030.
Shipments and Value of Hydrogen Fuel Cell Systems in China
(Predictions for 2017 to 2030)
Note: To ensure that hydrogen fuel cell devices operate smoothly at rated power, the total power of the installed hydrogen fuel cell stacks is usually higher than that of the hydrogen fuel cell system, which is an industry practice. Therefore, there is a gap between the shipments of hydrogen fuel cell stacks and those of hydrogen fuel cell systems.
Source: Analysis by Frost & Sullivan
03
Downstream applications of hydrogen fuel cells
The applications of hydrogen fuel cells mainly include transportation applications and stationary applications. To date,Driven by the promotion of hydrogen fuel cell vehicles, transportation applications have almost occupied all of the market share for hydrogen fuel cells.Due to the immaturity of the market, fixed installations of hydrogen fuel cells have not been commercially operated in China in the past few years.As hydrogen energy receives increasing attention from governments and markets, fixed power supply demonstration projects based on hydrogen fuel cell technology are expected to be carried out in the coming years.
In 2026, the market scale of hydrogen fuel cell systems for transportation and stationary applications in China will increase to approximately 11,342.9 megawatts and 974.3 megawatts based on shipments, with compound annual growth rates of 93.6% and 256.1% respectively from 2022. By 2030, the market scale of hydrogen fuel cell systems for transportation and stationary applications in China will further increase to 70,074.6 megawatts and 13,351.0 megawatts, accounting for 84.0% and 16.0% of the overall market scale, respectively.
Shipments of hydrogen fuel cell systems in China by application
(Predictions for 2017 to 2030)
Source: Analysis by Frost & Sullivan
1Transportation applications
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Hydrogen fuel cell vehicle
The transportation application areas of hydrogen fuel cells include hydrogen fuel cell vehicles, trams, and ships.Among them, hydrogen fuel cell vehicles are currently the most widely applied field, while the application of hydrogen fuel cells in fields such as ships and trams has already entered the demonstration or initial commercialization stage.
Hydrogen fuel cell vehicles include (i) commercial vehicles such as buses, logistics vehicles, material handling vehicles, dump trucks, and heavy trucks; (ii) engineering vehicles such as heavy transport vehicles, forklifts, cement mixers, and emergency vehicles; and (iii) passenger vehicles such as sedans and SUVs.
Driven by industrial subsidies, national support policies, and other measures, commercial vehicles have become the mainstream application scenario for hydrogen fuel cells in China.From 2017 to 2021, the market scale of hydrogen fuel cell systems for automobiles in China increased from 38.4 megawatts to 404.7 megawatts, with a compound annual growth rate of 80.2%. This accounted for 99.8% of the total market scale of hydrogen fuel cells for transportation applications.
Looking ahead, with the advancement of hydrogen fuel cell technology, the reduction in manufacturing costs, and the enhancement of industrial scale effects, hydrogen fuel cell vehicles will be further promoted, driving continuous growth in the hydrogen fuel cell system market. It is expected that the market scale of hydrogen fuel cell systems for automotive use in China will increase from 10,984.5 megawatts in 2026 to 65,884.4 megawatts by 2030. The compound annual growth rates from 2022 to 2026 and from 2027 to 2030 are expected to be 92.3% and 55.2%, respectively, to facilitate the rapid development of the industry.
Shipments of hydrogen fuel cell systems for automobiles in China
(Predictions for 2017 to 2030)
Source: Analysis by Frost & Sullivan
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ship
Hydrogen fuel cells can be used as the main power source for ships to meet the market demand for high-performance green ships on domestic, overseas, and long-distance routes. This specific application of hydrogen fuel cells has also been promoted by technological breakthroughs and favorable policies.Hydrogen fuel cell ships have advantages such as not producing greenhouse gases, low maintenance costs, long cruising ranges, and convenient fuel refueling.
Many countries or regions around the world, including Europe, the United States, and Japan, have taken the lead in launching hydrogen fuel cell ships. In China, some universities and research institutes have conducted research on civil ship hydrogen fuel cell systems over the past few years, with application scenarios mainly focusing on small and medium-sized yachts and some military vessels. For example, in May 2022, the construction of China's first inland hydrogen fuel cell-powered working boat, 'Three Gorges Hydrogen Boat No.1', began, which is also the first hydrogen fuel cell-powered working boat in China to be classified by the China Classification Society (CCS).
At present, a series of supportive policies have been introduced, providing a favorable external environment for the application of hydrogen fuel cells in the maritime field. The 'Medium- and Long-Term Plan for the Development of Hydrogen Energy Industries (2021-2035)' points out the exploration of hydrogen fuel cell applications on ships.
In addition, demonstration urban clusters have successively released relevant hydrogen energy development plans. For example, in August 2022, Liaoning Province issued the 'Liaoning Province Hydrogen Energy Industry Development Plan (2021-2025)', which sets the goal of having more than 50 hydrogen fuel cell ships in service by 2025 and more than 1,500 hydrogen fuel cell ships by 2035. The implementation of these ship demonstration projects is expected to provide valuable experience for the widespread promotion of hydrogen fuel cell ships in China in the future. In the future, hydrogen fuel cells will further penetrate into the ship sector.
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tram
Hydrogen fuel cell tram is a new type of rail vehicle powered by hydrogen energy.Hydrogen fuel cell trams have advantages such as low noise, minimal pollution, and long service life, providing new solutions for rail transit systems.
In 2017, Gaoming District in Foshan City, Guangdong Province, launched China's first hydrogen fuel cell tram. In October 2022, the world's first hydrogen-powered rubber-tired digital tram was rolled off the production line in Shanghai, which will also be China's first hydrogen-powered medium-capacity tram line. The first batch of five medium-capacity hydrogen-powered rubber-tired digital trams delivered this time will be put into operation on the Lingang T2 Line, promoting the construction of green public transportation networks and green cities.
With the promotion and application of hydrogen energy, especially the development and progress of hydrogen fuel cell technology, local governments such as Foshan and Shanghai will continue to strongly support the widespread application of hydrogen energy and promote the application of hydrogen fuel cell trams in China. In addition, some Chinese companies have won bids for overseas hydrogen fuel cell tram projects, which also indicates that the global demand for hydrogen fuel cell transportation applications such as trams is constantly growing.
2Fixed application
Hydrogen fuel cells are mainly used in standby power stations and fixed power stations as part of fixed power supply scenarios.Hydrogen fuel cell backup power supplies have advantages such as high efficiency, environmental friendliness, rapid response, and long service life. They can be widely applied in communication, power, internet data centers, medical, and public utility fields.
Some developed countries such as the United States have begun applying hydrogen fuel cells as backup power sources in data centers. For instance, some world-leading technology companies have increased their use of renewable energy in operation, including hydrogen fuel cell-powered data center infrastructure. In terms of fixed power stations, currently, hydrogen fuel cell power stations are mainly concentrated in North America, Japan, and South Korea.
Distributed power stations have strong modular performance, good scenario adaptability, and scalability. They can serve as a supplement to the main grid or be built in remote areas for independent power generation.The Chinese government has also promoted the application of hydrogen fuel cells in fixed power generation by introducing a series of incentive policies. For example, the 'Medium- and Long-Term Plan for the Development of Hydrogen Energy Industry (2021-2035)' issued in 2022 called on local governments to layout hydrogen fuel cell fixed power generation facilities according to local conditions, and promote demonstration projects for comprehensive utilization of hydrogen energy within residential areas, parks, mining areas, ports, and other regions.
Currently, some demonstration projects for hydrogen energy fixed power stations have been carried out domestically. In August 2022, the zero-carbon distributed intelligent energy center demonstration project in Yulin City, Shaanxi Province, was completed and put into operation. According to the 'White Paper on China's Hydrogen Energy and Fuel Cell Industry', by 2050, the production of hydrogen fuel cell fixed power generation devices in China is expected to reach 20,000 units per year.
As an emerging technology applied in fixed application scenarios, hydrogen energy storage has developed through the exchange of electrical energy and hydrogen. It can produce hydrogen by electrolyzing water, and then convert hydrogen into electricity through fuel cells, thereby storing electricity from different sources to achieve energy distribution, optimization, and integration.
Hydrogen energy storage can help build microgrid systems with combined thermal and hydrogen power supply, effectively solving energy consumption and storage problems.As a clean, efficient, and sustainable energy storage technology, hydrogen energy storage has advantages such as high energy density, low operating and maintenance costs, no pollution, and good compatibility with the environment (including but not limited to these). Therefore, hydrogen energy storage solutions have strong competitiveness in the future field of stationary power sources.
The Chinese government has also issued incentive policies to support the development of hydrogen energy storage. The 'Guiding Opinions on Accelerating the Development of New Energy Storage' released in July 2021 pointed out that research and demonstration applications of hydrogen energy storage technology are needed. Some local governments have also introduced relevant policies to support hydrogen energy storage technology. For example, the 'Medium- and Long-Term Plan for the Development of Hydrogen Energy Industry in Henan Province (2022 - 2035)' released in August 2022, as well as the 'Development Plan for the Hydrogen Energy Industry in Hunan Province' released in October 2022, indicate that timely demonstration applications of hydrogen energy in scenarios such as renewable energy consumption and grid peak shaving should be carried out, and active exploration of integrated application models combining renewable energy (such as wind and solar) power generation with hydrogen energy storage should be pursued.
