Green fuel firm says Britain risks losing out on hydrogen economy

The Sheffield-based company has developed electrolyser technology to generate hydrogen from renewable energy such as wind power.

But the AIM-listed company said its ambitions are currently thwarted by the lack of support for hydrogen, adding Government advisors are "missing a trick".

A report to Parliament last week by the Commission on Climate Change on how to ensure a low-carbon recovery called for the development of the electric car market but largely ignored hydrogen-fuelled vehicles.

ITM claimed economies such as Germany and the US are prioritising hydrogen to keep pace with innovation. Many major car makers are developing hydrogen vehicles for mass market release around 2015.

"What we need are incentives for people to switch from fossil fuels to green hydrogen," said ITM chief executive Graham Cooley. "The UK is going to come out of the recession by funding new industries. Clean technology is a good place to put your money."

The Committee on Climate change, chaired by Adair Turner, flagged electric cars as key to decarbonising the economy. In its report, Meeting Carbon Budgets – ensuring a low-carbon recovery, the committee said it is "feasible and desirable" for have up to 1.7m electric cars on the road by 2020, and urged Government to fund electric cars, as well as investing in a national battery charging network.

Dr Cooley said Government policy is influenced by the 2007 King review into low carbon cars, which favoured electric vehicles over hydrogen.

"They (Government) need to revisit that report in the light of what all the other companies are doing," he said. "It said 'Forget hydrogen, use electric vehicles'. Now every car company in the world is coming out with hydrogen vehicles. Is that not a hint? They are missing a trick.

"They seem to want to support early stage technology companies to rebuild industry. If they really want to do that they need to incentivise consumers to buy the products and manufacturers to make the products.

"It's a world market opening up here."

Car manufacturers Daimler, Kia and GM could each be producing around 10,000 hydrogen cars a year by 2015. By 2020 they will be joined by Hyundai in each producing more than 100,000 hydrogen cars a year. Germany has committed about $2bn to build 1,000 hydrogen refuelling stations by 2015.

ITM, which has developed a suite of products ranging from car refuellers to home electrolysers, is focusing its attention on the company fleet market. Its technology converts electricity, potentially from renewable sources, into hydrogen, which can be compressed for use when needed, but leaves no carbon footprint and does not require a hydrogen grid.

Logistics firm DHL recently agreed to test its refuelling equipment with two hydrogen-powered vans. ITM hopes soon to gain CE certification to allow it to sell its products.

ITM is also lobbying Government to consider a range of measures to support the industry, from subsidies to tax relief. Dr Cooley recently spoke at an event organised by Tory think tank the Centre for Policy Studies.

"We will not have the traction that international competitors have unless our Government recognises our proposition," he said. "While we are organically trying to battle our way through, competitors have the support of their governments."

A spokeswoman for the Department of Energy and Climate Change said: "The Government regards fuel cell and hydrogen energy technologies as having the potential to significantly reduce carbon emissions over the medium to longer term."

She added the Government is currently supportingfive fuel cell vehicles on the University of Birmingham campus, and five fuel cell buses in London.

Leading the drive to gas future

ITM's first product, launched in 2008, was a green box for refuelling hydrogen cars.

However, the launch of the green box, which took eight hours to fill a car, coincided with the global recession and failed to take off.

Over the past year, a new management team led by Graham Cooley has focused on commercialising ITM's electrolyser technology and recently launched a range of new products.

HPac is designed to supply hydrogen to compression systems for energy storage, fuel cells, engines and small industrial sites.

HFlame is aimed at applications where oxygen, acetylene, propane or natural gas are normally used, such as soldering, cutting and polishing.

HFuel is a self-contained unit for refuelling hydrogen-powered vehicles and forklift trucks.

HLab is aimed at the pharmaceutical, laboratory and fuel cell industries.

HBox is an electrolyser designed to produce heat and power inside the home.

It is now working on HFill, a high-compression, 700 bar home refueller. It has secured a contract to design the prototype for NextEnergy, a US organisation working with car manufacturers.