What's going on?

There have been important breakthroughs in the drive for hydrogen-powered cars this month.

The South Australian Government announced on Thursday that it will grant $8.2 million over four years for a hydrogen production and distribution site for fuel-cell-powered electric vehicles including at least six buses. Up in Sydney, the University of NSW has developed a more efficient catalyst for separating water into hydrogen and oxygen without the use of exotic metals, making the technology cheaper to access.

Chinese scientists have been working on a similar theme by pushing to make hydrogen production less energy-intensive, while the US Department of Energy is funding a Penn State project to find efficient ways to store hydrogen.

In Seoul, Hyundai insiders reportedly told Business Korea that the manufacturer is planning a 15-fold increase in the number of hydrogen-powered cars it sells when an all-new model goes into production in early 2018.

And that barely covers the last three weeks of development.

Why the big deal?

As Hyundai Australia environmental policy spokesman Scott Nargar told The Australian Financial Review: "all you need is water and sunshine".

Hyundai has big plans for its next fuel cell-powered vehicle. Photo: Supplied

Fuel cell vehicles have been touted as a long-term solution to the problem of personal transportation.

Hyundai, Toyota and Honda have put fuel cell-powered cars into production that offer emissions-free motoring with faster refuelling times than electric vehicles.

Hydrogen for fuel cell vehicles can be sourced from water, which is split into hydrogen and oxygen using electricity. After the electrolysis process, hydrogen is stored under high pressure (up to 800bar or 11,600PSI) and pumped into cars at special service stations.

Fuel cell vehicles such as Toyota's Mirai store compressed hydrogen gas in an armoured container in the back of the car, pumping it through to a fuel cell under the bonnet. There, a complex arrangement of thin, sheet-like membranes combines that hydrogen with oxygen sourced from ambient air around the car. The fuel cell's catalyst triggers a chemical reaction that divides hydrogen molecules into positively charged protons and negatively charged electrons that create an electric current before fusing with oxygen to become water.

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The current is then used to power electric motors to provide propulsion, while the water leaves the car as waste.

Hydrogen's key advantage over plug-in electric vehicles is that a car can take on a full take of hydrogen in a few minutes – roughly the same amount of time it takes to top up a tank of petrol – while electric cars usually require several hours to take a charge.

The problem is that hydrogen technology is expensive and infrastructure is extremely limited – particularly compared with the power grid. Both of those factors are likely to change in coming years.

Hydrogen power is also inefficient compared with the latest battery tech. But it isn't as materials-intensive, and it looks to be more scalable than battery tech as heavy vehicles look set to be a key battleground for the race between hydrogen and electric power. The gas is lighter than equivalent lithium-ion batteries, making it a better bet for buses and trucks. Toyota revealed a new fuel cell-powered semi-trailer concept in May that produces 500kW of power and almost 1800Nm of torque, offering a payload of 36.2 tonnes and a working range of 320 kilometres.

Who cares?

Car companies care, as fuel cell vehicles may prove key as manufacturers are required to reach increasingly strict emissions requirements.

Motorists should care, as fuel cell cars offer emissions free motoring with similar ranges and refuelling times to existing petrol and diesel vehicles.

Governments should care as hydrogen technology promises to improve air quality in a sustainable manner.

Say what?

Hyundai Australia's Scott Nargar is hydrogen's lead evangelist in Australia:

"With this vehicle we can rely on a domestic fuel source and not have to rely on oil from overseas. We can make the fuel on site, we can use solar panels and water to make hydrogen and the only thing out the exhaust is water vapour."

Former federal industry minister Ian MacFarlane in April 2015:

"In the end, the long term future has got to be in a fuel cell vehicle that is zero emissions. There's no doubt that electric and hybrid technology is a transitioning technology but in terms of where we're going long term you need a vehicle that's flexible, that gives you the range and the hydrogen vehicle is the only one that satisfies those criteria."

Former US Department of Energy official David Friedman in October 2016:

"Almost every major automaker is actively pursuing hydrogen fuel cell electric vehicles... I believe we may be on the verge of a tipping point and it is truly exciting."

Charles Freese, General Motors' executive director for fuel cell business has plenty of faith in the technology:

"We've clearly left the science project stage, and the technology is viable."

But Mike Chung, Penn State professor of materials science and engineering says challenges remain:

"We face many difficulties with hydrogen storage technology, the technology isn't as well established yet as other alternative fuel sources, such as solar and wind power."

And Tesla chief executive Elon Musk says fuel cell tech is "bullshit":

"Hydrogen is an energy storage mechanism. It is not a source of energy... If you, say, took a solar panel and use the energy from that to just charge a battery pack directly, compared to try to split water, take the hydrogen, dump the oxygen, compress the hydrogen to an extremely high pressure (or liquefy it) and then put it in a car and run a fuel-cell, it is about half the efficiency, it's terrible. Why would you do that? It makes no sense."

What next?

Musk has a point, but you could equally argue Tesla is heavily invested in battery technology and must push its own barrow.

There's no doubt battery-powered vehicles have an important role to play in the new car market, and you can expect to see Tesla-rivalling machines from a variety of brands including Mercedes-Benz, Volkswagen, Porsche and Volvo.

But there also seems to be a consensus suggesting that fuel cell vehicles will be the future.

KPMG's 2017 Global Automotive Executive Survey found that 62 per cent of executives "absolutely or partly agree that BEVs (battery electric vehicles) will fail due to infrastructure challenges", while 78 per cent of executives agree that "FCEVs (fuel cell electric vehicles) will be the real breakthrough for electric mobility".

Honda and General Motors announced in January that they would work together to build fuel efficient cars from January, shortly after BMW, Mercedes, Honda and Hyundai banded together with industry and energy companies such as Shell, Air Liquide and Linde to commit 10 billion Euros to a cooperative effort to fund fuel cell development in a bid to fight climate change.

Hyundai's next-generation fuel cell-powered SUV will enter into production in 2018, offering at least 800 kilometres of range. The company is expected to bring a handful of its own examples to Australia, as well as a fleet of 20 cars that will be part of a renewable energy effort in Canberra.

BMW said in March that it will produce a production-ready fuel cell vehicle from 2021, and Mercedes is set to launch its own examples in 2018. However, Daimler chairman Dieter Zetsche has gone a little cold on hydrogen tech, telling Drive in January that "in the last five, six, seven years battery electric vehicles have developed much faster, much further than we expected".

"The advantages of fuel cell vehicles as far as filling versus charging times are concerned have become much smaller," he said.

"For that reason, I think it's smart to focus on battery electric vehicles."

Recent developments in the cost and efficiency of fuel cell units could turn the tide away from battery tech.

CSIRO research into membrane reactor technology revealed in May has the potential to transform liquid ammonia (something Australia has in great supply) into high-purity hydrogen for use in electric vehicles.

Dr Larry Marshall, chief executive of the CSIRO, described the development as "a watershed moment for energy".

Brett Cooper, chair of renewable hydrogen for the scientific body, says it could make Australia a major player in the regional energy market.

"With this technology, we can now deliver our renewable energy to Japan, Korea and across the Asia-Pacific region in liquid form, as renewable ammonia, and efficiently convert it back to pure hydrogen for cars, buses, power generation and industrial processes," he said.

"This market didn't exist 10 years ago – now Australia is positioned to be the number one renewable fuel provider in the world's fastest growing region."

Hyundai and Toyota, which both run fuel cell demonstration vehicles in Australia, support the CSIRO's program.

Hydrogen cars have been somewhat slow to take off because of a lack of refuelling infrastructure – something Nargar says is unlikely to change without government investment.

While the tide is shifting there in Australia – hydrogen investment in South Australia and the ACT is likely to be followed by other states – the world's most influential automotive market could prove to be a problem.

The US has been utterly key to the rise of hybrid and electric cars such as Toyota's Prius and Tesla's Model S, in part because of state and federal incentives for customers and infrastructure.

That may be problematic in the short term, as President Donald Trump has rolled back strict emissions standards in the US while reducing the nation's commitment to fight climate change.

David Friedman, a former senior US Department of Energy official and hydrogen proponent, told the Washington Post in December 2016 – after President Trump won the US election - that sustainable transport opportunities had been politicised.

Friedman, who was put in place by former President Barack Obama, said "the Department of Energy has really changed the world when it comes to energy" and that the US is "facing a fundamental question in this country" regarding green tech.

"Are we going to invest in the technologies that have been revolutionizing the world of energy, and that other countries are waking up to and investing in?" he said.

"Or are we going to let that multi-trillion dollar opportunity slip by?"

Friedman left the Department of Energy after President Donald Trump took office, tweeting that the political climate in Washington was "frightful".

This is what you get when you try links related to climate change on https://t.co/PuICksCp5D pic.twitter.com/FxwWMhNnO6

— David Friedman (@DJ_Friedman) January 20, 2017