HYDROGEN BUSES MARKET ANALYSIS

Market Challenges And Opportunities

Global Hydrogen Buses Market Drivers

• Environmental regulations to reduce greenhouse gas emission: Stricter environmental policies and regulations by governments worldwide to reduce greenhouse gas emissions have been influential. They push for the adoption of cleaner transportation options, with hydrogen buses being a viable solution due to their zero-emission nature. The number of fuel cell buses deployed in real-world operations worldwide grew from around 100 in 2015 to over 600 in 2020.
• Climate change commitments: International agreements such as the Paris Agreement it is a legally binding international treaty on climate change. It was adopted by 196 Parties at the UN Climate Change Conference, have compelled nations to take definitive action to combat climate change. Hydrogen buses contribute in meeting carbon reduction targets, thus driving their market adoption. According to the International Energy Agency, over 200 hydrogen buses were already in service across major cities like London, U.K., Cologne, Germany and Beijing, China till 2020.
• Advancements in hydrogen fuel cell technology: Advancements in fuel cell technology have increased the efficiency and reliability of hydrogen buses, thus making them more competitive with conventional buses and even other electric alternatives.
• Financial incentives and funding for development of technology: Financial incentives, subsidies, and funding for research and development (R&D) in the field of hydrogen fuel cell technology have been a crucial driver, as they lower the initial cost barrier for transit authorities and bus operators. In the U.K., according to a 2021 report by the Hydrogen Council, at least 20 cities have drawn up plans to introduce hydrogen buses by 2023, to meet air quality targets.

Global Hydrogen Buses Market Opportunities

• Infrastructure development to increase growth of market: The establishment and expansion of hydrogen refueling infrastructure provide an opportunity for the growth of the hydrogen buses market. This includes government and private sector investments in building new refueling stations to make hydrogen more accessible. In Asia, ambitious nationwide targets have been established to deploy heavy-duty hydrogen buses and build associated fuelling infrastructure. For example, China's goal of 1,000 fuel cell buses on the road by 2022 and South Korea's roadmap 2040 for eco-friendly urban transportation including 2,000 hydrogen buses deployed by 2025. This type of coordinated infrastructure development and future vehicle deployment commitments and targets from governments serves to significantly reduce risk and boost commercial viability for hydrogen bus manufacturers and providers.
• Innovation in hydrogen fuel cell technology: Continuous innovation in hydrogen fuel cell technology, including improvements in durability, efficiency, and cost, presents an opportunity for market expansion. Innovations can also lead to reduced operational costs, making hydrogen buses more economically competitive. According to the International Energy Agency's report, 2021, China aims to have over 20,000 fuel cell buses on the road by 2030
• Transitioning fleets as a beneficial alternative: As public transport fleets around the world transition towards zero-emission vehicles, hydrogen buses stand as a beneficial alternative, especially for routes that require longer ranges and quick refueling times. According to the Fuel Cells and Hydrogen Joint undertaking, over 300 fuel cell buses were already operational across Europe till 2022. Germany has committed in procuring 2100 hydrogen buses by 2030.