Should You Bet on a Hydrogen Fuel Cell Future?

Toyota, Hyundai, and Honda are betting on the future of fuel cell vehicles. Will it payoff?

Apr 27, 2014 at 12:31PM

2015 Tucson Fuel Cell. Photo credit: Hyundai.

When it comes to fuel cell electric vehicles, or FCEVs, two of the main barriers to widespread adoption are cost and the lack of a hydrogen-fueling infrastructure. However, recent advances could help solve these problems. For Toyota Motor (NYSE:TM), Hyundai Motor (NASDAQOTH:HYMTF), and Honda Motor (NYSE:HMC), this is great news.

Reduced platinum
One of the biggest drivers of cost when it comes to FCEVs is the platinum catalyst in fuel cells. The good news is that, since 2005, the amount of platinum needed in fuel cells has dropped 80%. However, that's not enough for scientists at NREL, so they're working to make "ultra-thin platinum films limited to a few atomic layers." The reason, according to NREL, is that if the use of platinum is decreased by two-thirds, "hydrogen fuel cells could reach precious metal loadings on parity with catalytic converters in today's internal-combustion engines." 

The above is important because currently catalytic converters are mandatory for pollution control in internal combustion engine, or ICE, vehicles. However, the emissions from an FCEV are heat and water. Consequently, a catalytic converter isn't necessary for FCEVs, which means the amount of platinum used in future FCEVs would be the same as that of today's ICE vehicles that utilize platinum.

Moreover, while reducing the use of platinum is one way to reduce the cost of FCEVs, another way is to remove the use of platinum, altogether. As I recently wrote, Argonne National Laboratory is currently working on a polymer electrolyte fuel cell, or PEFC, which replaces the platinum cathode with a cheaper catalyst. If successful, this would reduce the cost of the cathode electrocatalyst by 60%. 

Tri-generation fuel cell and hydrogen energy station


Hydrogen fueling station and fuel cell vehicle, Shell Hydrogen. Photo credit: Michael Penev for NREL.

In 2011, FuelCell Energy (NASDAQ:FCEL), along with the Energy Department and a number of other agencies, opened the world's first tri-generation fuel cell and hydrogen energy station in Fountain Valley, Cali. What this station does is convert renewable biogas from a nearby wastewater treatment plant into hydrogen for vehicle fueling. Additionally, the installation produces electricity and heat, which is then used to power and warm the facility, according to the Energy Department. Even better? All of this is accomplished onsite, eliminating the need to transport hydrogen to the fueling station.

More importantly, on March 7, FuelCell Energy announced that the U.S. Department of Energy granted FuelCell Energy a $2.8 million continuation award, which will be used to further demonstrate its tri-gen system technology.

Of course, FuelCell Energy isn't the only company producing onsite hydrogen systems. HyperSolar, along with the University of California at Santa Barbara, is working on a self-contained photoelectrochemical nanosystem, which produces renewable hydrogen using sunlight and any source of water -- even wastewater. The company already has a working prototype, and said that in the process of creating its nanotechnology it developed a commercial hydrogen-extraction solution called the H2Generator, which is a stand-alone, self-contained solar hydrogen generator that HyperSolar says "is intended to be installed almost anywhere to produce hydrogen fuel for local use." 

Why bet on hydrogen?


Toyota FCV concept. Photo credit: Mytho88 via Wikimedia Commons.

When it comes to the future of green transportation, FCEVs have a number of things going for them. Hydrogen's energy density is about seven times higher than that of lithium-ion batteries, according to Toyota's alternative fuel comparison chart. FCEVs can be refueled in minutes and have a driving range similar to an ICE vehicle, and the costs of both fuel cells and hydrogen fuel have fallen significantly. According to the Energy Department, fuel cells for vehicles have fallen to $55 a kilowatt, and the projected cost of gasoline-gallon equivalent is less than $4 after adding costs to deliver and distribute. 

More importantly, auto manufactures are betting big on hydrogen. In California this spring, Hyundai will begin leasing its Hyundai Tucson Fuel Cell vehicle for $2,999 down and $499 a month -- and that includes unlimited free hydrogen refueling. Plus, both Toyota and Honda are planning on launching their fuel cell vehicles in 2015. 

Consequently, while there are currently still barriers to overcome when it comes to widespread FCEV adoption, those barriers are becoming smaller by the day. As such, if you're looking to invest in the future of FCEVs, I'd take a closer look at the above auto companies betting on hydrogen.

Say goodbye to "Made-In-China"
For the first time since the early days of this country, we're in a position to dominate the global manufacturing landscape thanks to a single, revolutionary technology: 3-D printing. Although this sounds like something out of a science fiction novel, the success of 3-D printing is already a foregone conclusion to many manufacturers around the world. The trick now is to identify the companies -- and thereby the stocks -- that will prevail in the battle for market share. To see the three companies that are currently positioned to do so, simply download our invaluable free report on the topic by clicking here now.

Katie Spence has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.

Compare Brokers