Recently, I had the opportunity to participate in a roundtable discussion on the use of hydrogen in public transport. It was a great chance to research and reflect on this topic, and here are my conclusions.

In my opinion, hydrogen faces five major challenges:

Challenge 1: Credibility

To tackle decarbonization, public transport is betting on the use of green fuels. In the case of transport that uses catenaries, third rails, batteries, or fuel cells, the primary energy comes from electricity. Transport operators account for the energy consumed during a year, purchase the relevant guarantees of origin, and account for zero CO2 emissions to power the rolling stock.

Now we need to talk about Guarantees of Origin, which are a mechanism by which the green energy generator puts a production accreditation on the market, and the energy consumer acquires them to justify that the energy consumed comes from renewables. This is an administrative process that helps boost the generation of renewable energies; however, it has little to do with reality. The energy consumed comes from the current mix, which contains a percentage of renewables that varies throughout the day.

I believe there is a great opportunity here for hydrogen to be a more credible technology than the rest. Let me explain. If the transport operator uses energy when needed, regardless of the time of day when renewables have more production, they are increasing the energy demand of other more polluting technologies. This harms the environment and benefits electric companies, which will see increased energy prices.

The duck curve and daily energy prices are related; the lowest hourly prices, which have occasionally reached zero, are during hours of maximum solar production. Here, hydrogen has the opportunity to consume this surplus or cheaper energy and store it for later use.

My opinion is that the Guarantees of Origin mechanism needs to be reformed so that it stops being an administrative process and becomes a more technical mechanism to better match supply and demand, making hourly prices less variable. With this reform, hydrogen would gain credibility and market as the only fuel with zero CO2 emissions.

Challenge 2: Technology

Fuel cell buses that use hydrogen as a fuel source, generating electricity through hydrogen for use in an electric motor, are the technology prevailing in the market. The technology that uses hydrogen in combustion or thermal rectified engines seems to have been relegated. Therefore, the hydrogen buses being adopted are fuel cell ones. These buses are nascent, with few kilometers driven and few years of operation, lacking sufficient accumulated experience for successive technological feedbacks that improve the product. Consequently, this technology is in the initial phase of the bathtub curve, which measures the failure rate of a project throughout its life. In this phase, the reliability and therefore, the availability of buses is lower than that of other technologies.

We are dealing with a little-tested technology that requires "early adopters" for its fine-tuning.

Challenge 3: Competitiveness

With the experience accumulated to date, the general idea is that battery buses have a much lower cost per kilometer than hydrogen buses. This is the general thinking, and it is not far from reality.



Below is a comparative table that could be debated in its calculation methodology, but it supports the general view that hydrogen technology is almost three times more expensive than battery technology.