context: Hydrogen cars were a hype in 2019, prompting more than 30 municipalities to issue local plans. But production was halved y-o-y in the first eight months of 2020, partly due to uncertainty over central government support. Now, long-awaited requirements for pilot projects are finally out. A vision of hydrogen as an energy source is also emerging.
Rather than through purchase subsidies, FCV (fuel cell vehicle) makers and other industry players will be supported through a reward system. Requirements for participating urban clusters were issued by MoF (Ministry of Finance), MIIT (Ministry of Industry and IT) and three other agencies on 21 Sep 2020. Urban clusters should use the rewards to
- industrialise key core technologies
- attract and cultivate talent
- develop new tech and business models
Hydrogen production and refuelling infrastructure projects do not qualify for this particular support.
The plan, which runs as a 4-year pilot, prioritises mid-to-long-range, medium-to-large-sized commercial FCVs, reports 21st Century Business Herald. It will help build an industry chain, comments Cui Dongshu 崔东树 China Passenger Car Association secretary general. Rational planning, local advantages, and coordination are elevated by the plan, says Zhao Xiaoli 赵小丽 Vision Group strategic investment vice president, noting lessons learnt from NEV (new energy vehicle) subsidies. Whole-car manufacturers will expand their hydrogen car branches, an industry insider told 21st Century Business Herald. Rather than enterprises, the plan empowers local governments, says the insider, as these more effectively facilitate application scenarios and coordination along the industrial chain.
Local governments and firms will be rewarded for
- FCV numbers
- hydrogen-powered mileage per vehicle
- relevant annual hydrogen production capacity and capped retail hydrogen price
A target price for hydrogen fuel has been set, notes Cui, at C¥35 per kilo. Most hydrogen needs further purification to suit FCVs, notes Cui, calling for careful tactics to meet the price target in four years.
The scheme's promotion of cross-regional collaboration will run up against the dispersed and isolated nature of current local initiatives, argues 21st Century Business Herald. Enabling enterprises to join multiple pilots can avoid forced investment locally for pilot eligibility and quantity-over-quality construction, says MIIT. Shanghai, Beijing, Hunan and Shanxi provinces indicated submitting applications, says the report.