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Introduction To The Hydrogen Economy

Worldwide energy demand is expected to grow by over 40% in the next twenty years [01]. The WTO predicts an average growth rate of 1.8% per annum for primary energy worldwide in the period of 2000-2030 [02]. This growth rate may seem small at first glance; however it translates into an increase of 70% over that period of time. Due to this currently raising energy demand new technological approaches and renewable energies are necessary to avoid catastrophic bottlenecks in energy consumption. Thus it is important for the future economy and society to distance ourselves from dwindling and limited fossil fuel reserves currently being utilised as the primary sources of energy.

Governments are well aware of the current energy demand situation and its repercussions, particularly with the negative impact fossil fuels have on our environment. The two main sectors being addressed through measures taken by governments are transportation – e.g. automobiles - and energy production. Despite having different agendas in terms of energy policy authorities and policy makers are all heading in a similar direction, a reduction of fossil energy consumption and an increase in use of renewable energies. For instance, the European Commission wants 5.75% of all transport fuel to come from non-fossil sources and 18% of energy production to come from renewable sources by 2010 [03]. In detail, the break down of renewable energy sources discussed by the European Commission is a mixture composed of 10% compressed natural gas, 5-8% bio fuels and 5% of hydrogen based energy [04]. These kinds of initiatives are also shared by US policy makers who expert by 2025 about 2.5% to 5% of US transportation fuel to be based on hydrogen if current technology targets are met [05]. This statement emphasizes the important role of researcher and research facilities paving the way for the roll out of a new technological platform such as hydrogen fuelled vehicles. From an industrial point of view, the swift from fossil fuels towards free emission technologies creates a central opportunity. The hydrogen fuel cell platform becomes crucial under these circumstances for the practical development of the hydrogen economy in the field of transportation. In Japan the expected number of fuel cell vehicles (FCV) is 50.000 in 2010 increasing to 5 million by 2020. For stationary fuel cells 2,1 million kW are expected to be in used by 2010 raising to 10 million kW by 2020 [06]. This tendency shows that the automotive industry is getting ready to embrace the hydrogen economy. Research and development efforts are thus diverted to more accessible hydrogen fuelled cars. Toyota plans to offer cars with this technology at a cost of $50,000 by the year 2015. Other large automotive players such as BMW or DaimlerChrysler expect hydrogen to become the future of the automotive industry [08] anticipating in their vision hydrogen fuel cell vehicles going into volume production from 2010 onwards. [09] Experts corroborate this technological trend forecasting 3,3% by 2020 and 23,7 by 2030 of the European vehicle fleet to be fuelled by hydrogen [07]. This kind of future scenarios motivates the energy production industry to invest in the future of hydrogen technology providing the necessary infrastructure and means to power 40 million hydrogen cars in Europe. In other to achieve a world wide roll out of an innovative technology platform, a joint effort of executive authorities, policy makers, varied industrial sectors and customers is essential. Public and private investment along with necessary infrastructure has to be coordinated and built up in cooperation between the different actors to accomplish a successful establishment of the hydrogen technology. With the expected amount of future hydrogen vehicles, the European Commission foresees installing hydrogen at 30% of Europe’s fuel stations [02]. Such a penetration of the technology could cost in the order of 100-200 billion euros and would be needed to guarantee the necessary comfort for customers to be an economic success. Linde AG reaffirms this assessment estimating a network of 2.800 filling stations to serve 6.1 million cars in Europe [10]. The chairman of the HFP [11] predicts a high scenario for 2020 with 6 million hydrogen vehicles and 45 million by 2030. Whereas in his low scenario, Herbert Kohler foresees 1,3 million by 2020 and up to 14 million vehicles by 2030. In his opinion, this estimation means that up to 2030 500.000 jobs can be either created or lost, cementing the socio-economical importance and impact of the hydrogen economy. Concerning the importance of highly qualified jobs to the hydrogen economy, the European Commission has recently identified a shortage of experts in the key disciplines (natural sciences and engineering) relevant to hydrogen technology and hydrogen safety. According to the DoE 750.000 new jobs will be created in the field of hydrogen fuel cell technology, hydrogen infrastructure and advanced automotive technologies. [02] In parallel to that, the EREC forecasts 1,000,000 jobs in 2010 in renewable energies (direct and indirect employment) and 2,000,000 jobs by 2020 if current ambitious plans are implemented [20]. Out of this large number, many of these jobs are expected to be related to the field of hydrogen as an energy carrier, stressing the importance of the hydrogen related technologies for the economy of our future society. With such a scenario, and many jobs depending on the hydrogen technology, it is vital to implement state of the art safety measures in order to deal with possible hazards allowing a responsible use of this technology. The labelling of a technology as “safe” will certainly induce a higher economic penetration and would greatly contribute to its success. A recent study of the IPCC has predicted the negative effects of global warming and stressed the necessity to cut CO2 emissions from fossil fuels and the use of cleaner renewable energies. The hydrogen energy platform plays an important role as a vessel to counteract the harmful effects of fossil fuels as energy carriers. Due to the societal and strategic importance of hydrogen as an energy source, public investment is necessary to accelerate the development, regulate safety issues and provide the necessary infrastructure. In this manner different governments and policy makers regard the set-up of the hydrogen economy as a public duty. The EC backs up the industry for the hydrogen economy with 5 billion Euros investment [12]. For the area of research, the EC’s investment within the FP7 in the thematic area of hydrogen technology ascends to 6.7 billion € for the 2007 to 2015 period. This represents an increase of 75 million Euro per year compared to the 6th framework program [02]. The US administration is also investing $1,7 billion in R&D for a period of 5 years for the development hydrogen fuel cell technology and hydrogen infrastructure, in order to cut the petroleum consumption by 33 percent in the next 30 years. [02]

The foreseen market for hydrogen based technologies plays a critical role in the development of the hydrogen economy. The EC anticipates that early markets – including specialist vehicles and portable applications – could be established by 2010, with satisfactory applications achieving commercialisation by 2015 and mass transport applications by 2020. [15] For concrete applications such as automotive hydrogen fuel cells, a forecast conducted in 2004 by WinterGreen Research [16] predicts that the total vehicle fuel cell markets for automobiles will ascend to $772.7 million in 2007 will grow to $98billion by 2013. A similar assessment conducted by Clean Edge states that the fuel cell and distributed hydrogen market will grow from $1.2 billion (primarily for research contracts and demonstration and test units) in 2005 to $15.1 billion by 2015 [17]. An independent Japanese report from Fuji Keizai Co. shares similar views, estimating that the world commercial demand for fuel cell products and services, including revenues associated with prototyping and test marketing, is projected to increase sevenfold to $2.5 billion in 2009 and reach $13.5 billion in 2014 [18]. Despite high discrepancies in the values of these assessments of the future market, a clear tendency of growth becomes visible. Furthermore, the predicted penetration of the hydrogen technology will not be limited to single countries but rather become a global effect. Prediction for individual markets foresees for instance $2,7 billion by 2015 and $11,7 billion for 2020 for the Japanese market. [17]. For Europe the estimated market figures are about $368 million in 2005 at an average annual growth rate of 15 percent to $740 million in 2010 [19]

In conclusion, the hydrogen economy will very likely become a reality in the following 10 to 30 years. The importance of the establishment of this technology goes beyond its economic impact, as it is expected to generate a large number of highly qualified jobs in the next 20 years. This foreseen emerging market demands for a suitable education offer in order to provide the industry and future R&D facilities with a sufficiently qualified workforce. Additionally the significance of dealing with safety issues related to the hydrogen technology becomes clear. The forecasted penetration for hydrogen based applications such as mobile devices, energy storage or automotive propulsion can only be achieved if customers and users of this technology perceive it as safe to use.


[01] Global Warming - Renewable Energy 2005 – Chevron Texaco Corp.

[02] Hydrogen Energy and Fuel Cells – A vision of our future, European Commission 2003]

[03] [„Tilting at windmills”,, Nov 16th 2006

[04] Deutscher Wasserstoff Verband DWV e.V.: Prinzipielle Anforderungen an die Infrastruktur 12/03, S. 4.5

[05] “The roles and opportunities for power companies in the hydrogen-electric economy – an EPRI White Paper” Dan Rastler, Press Release NHA, September 2006

[06] “Roadmap for Polymer Electrolyte Fuel Cells (PEFC) Technologies Development (Summary)” Fuel Cell Commercialization Conference of Japan FCCJ, December 2003

[07] HyWays Hydrogen Roadmap

[08] „Artikel zum Scientific Award BMW Group 2005“ – Interview mit Dr. Burkhard Göschel, Vor-standsmitglied der BMW Group für Entwicklung und Einkauf

[09] “Environmental Report 2004 – Magazine: Visions of Sustainable Mobility”, DaimlerChrys-ler’s Chief Environmental Officer Herbert Kohler


[11] “Strategy to Action” Herbert Kohler, Chairman Advisory Council, HFP, 06.12.2006 Brus-sels

[12] “Hydrogen Economy moves up a gear with 5 billion Euro industrial investment” HFP

[13] “Welcoming Remarks of the U.S. Secretary of Energy Spencer Abraham, IPHE Ministerial Meeting, Washington 2003


[15] “Hydrogen comes of age – Creating a global hydrogen business” Duncan Macleod, Vice President Shell Hydrogen at NHA Conference World Hydrogen Energy Conference 2006

[16] “Fuel Cell Transportation Market Opportunities, Market Forecasts, and Market Strategies, 2007-2013” Published by: Wintergreen Research, Published: 01.05.2005. 525 Pages

[17] “Wasserman Morris Equity Initiation Report”

[18] November 2004 report released by Fuji Keizai Co.

[19] Fuji-Keizai USA, Inc., 2005 Hydrogen Market, Hydrogen R&D and Commercial Implication in The U.S. and E.U.

[20] Eco-industry, its size, employment, perspectives and barriers to growth in an enlarged EU”; September 2006; Final report; European Commission – DG Environment

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Page last modified on February 06, 2007, at 06:38 PM