SCMP: Hong Kong’s uptake of hydrogen, hampered by limited supplies, high costs and infrastructure, can be solved by allowing logistics vehicles to fill up on the zero-emission fuel across the border, according to a start-up.

Qian Wei, founder and CEO of Hong Kong-based H2 Solution, which markets hydrogen fuel cell systems overseas, said the city can tap relatively cheaper hydrogen and refuelling infrastructure in Foshan, a two-hour drive northwest of Hong Kong and a major hydrogen production centre.

“Since starting commercial adoption of hydrogen in 2019, Foshan has learned some valuable lessons,” he told the InnoTech Forum last week, noting that Hong Kong can adopt best practices from Foshan without having to reinvent the wheel.

Hong Kong can do away with the hassle by integrating its hydrogen economy with the supply chain of the Greater Bay Area, where cities can leverage their strengths in production, distribution, application and technology development, he added.

Hong Kong’s first hydrogen refuelling station is being built by a subsidiary of China Petroleum & Chemical (Sinopec) in the northwestern district of Yuen Long. It will be ready by the year-end.

The nation’s biggest fuel producer has built 128 stations in China, the most in the world, according to Aaron Yu, the deputy director of Sinopec Hong Kong.

The high cost of hydrogen is another barrier. A year ago, Sinopec had planned to price the fuel at HK$108 per kg (US$13.80), three times the price in Foshan where it costs 35 yuan (HK$38.10), according to Qian.

H2 Solution has applied to the Hong Kong government to pilot a few hydrogen fuel-cell trucks that meet technical requirements on both sides of the border, according to Zion Lee Sheung-yuk, a consultant at the start-up.

After obtaining the necessary approval, the company plans to obtain permits from the Guangdong government to operate four 4.5-tonne hydrogen fuel-cell trucks on two cross-border routes, he said.

In August, H2 Solution signed an agreement with Hong Kong Weixin Logistics to jointly develop hydrogen cross-border logistics and promote “deep integration” of the hydrogen industry chain between Guangdong and Hong Kong.

It is among the more than 10 agreements that H2 Solution has signed with Hong Kong transport operators on cross-border hydrogen-fuelled transport, Lee said.

The potential market can be substantial if cross-border trucks are allowed to fill up on hydrogen on the mainland.

At the end of September, there were around 9,500 goods vehicles with valid cross-border permits issued by the government, according to Hong Kong’s Transport Department.

“We have been communicating with our mainland counterparts, especially those in the Greater Bay Area, to leverage on their successful experience and developments in the application of hydrogen energy,” said a spokesman of the Environment and Ecology Bureau, which leads a cross-department working group on hydrogen pilot projects.

This will help to facilitate trial projects of cross-boundary hydrogen fuel-cell vehicles and address any potential issues encountered during the pilot trials, he added.

Foshan had 36 hydrogen refuelling stations in July, the most in China and just over half the total in Guangdong, according to local government data. The Guangdong government aims to boost the province’s network to 200 stations by the end of next year. It had 68 stations in June.

The economic viability of cross-border hydrogen-powered trucking still needs to be worked out, according to Civic Exchange, which published a research paper in May on how Hong Kong can develop its hydrogen economy.
Lawrence Lu, executive director of the public policy think tank, said while trucks can fill up on cheap hydrogen in Foshan where it is made, some fleet operators may incur extra refuelling costs and time.

“It is unclear whether it would be financially and operationally attractive for Hong Kong-bound hydrogen trucks to travel to Foshan for refuelling, unless there is substantial transport demand for goods originating from the Foshan region,” Lu said.

The Guangdong government is aiming for the first batch of trucks – powered by batteries or hydrogen – to ply the Shenzhen-Hong Kong route next year, he noted.

Peter Ho, secretary general of industry body Hong Kong Hydrogen Alliance, backed the idea of piloting cross-border hydrogen vehicles with refuelling in Foshan. The feasibility, however, will hinge on steady trucking demand between the two cities and regulations on hydrogen trucks.

In the longer term, this route can be integrated into Guangdong’s wider hydrogen trucking development to bolster economic viability, he noted.

Originally published on SCMP on 27 October 2024.