The Cost of Hydrogen Vs. Gas

While gasoline remains the predominant fuel source for automobiles, hydrogen-fueled vehicles already are available for consumer use. Most of these are in California, where as of 2009, about 300 hydrogen-fueled vehicles are in use. Fuel cell tester Powertech estimates there will be more than 4,000 such vehicles in use as of 2014. GM, Honda, Hyundai and Nissan all have hydrogen-fueled cars in some phase of development. Because of the high cost and time involved in developing these vehicles, however, many manufacturers have scaled back research and development on them as they struggle with their own solvency.

Pound for pound, hydrogen fuel cells contain three times the energy of gasoline, according to the U.S. Department of Energy. Were hydrogen fuel widely produced, it would cost the equivalent of $2 per gallon, according to U.S. News & World Report. This is well below the average price of gasoline in the United States as of 2010. High efficiency--current models can get about 70 miles per gallon--and low emissions further enhance the value of hydrogen-fueled cars.

While hydrogen is a cheaper fuel than gasoline on paper, the reality is, as of 2010, it is much more expensive. The few models of hydrogen-fueled cars that are commercially available generally cost more than $100,000. Researchers are still tweaking the technology to produce and transport hydrogen fuel. Thus, fueling stations are limited, making the cost of hydrogen fuel vary widely. Manufacturers also face a challenge in designing cost-efficient methods of storing hydrogen fuel, according to the U.S. Department of Energy.

Auto manufacturers from 2002 to 2009 made significant progress in decreasing the cost of hydrogen fuel cell systems for automobiles. Such systems cost about $248 per kilowatt in 2002, and they cut that to $51 by 2009, according to the U.S. Department of Energy. Even as the vehicles improve, mass consumer use of hydrogen-fueled vehicles would require billions of dollars in investment for the infrastructure of fueling stations. Most manufacturers and government entities agree that a true "hydrogen economy," in which hydrogen-fueled vehicles are equally or more cost efficient compared to gasoline-fueled vehicles, is still at least a decade in the future.

Because of the massive economic hurdle in making hydrogen-fueled cars an affordable option, manufacturers are investing in other methods to wean off gasoline dependency. Hybrid vehicles, which combine the internal combustion engine with electric motors, are continually gaining in popularity, and manufacturers also are making advancing battery technology to make electric cars more viable, according to the U.S. Department of Energy. Hydrogen-fueled cars will have to prove more viable than these alternatives in order to become more cost effective than gasoline.