A key benefit of hydrogen internal combustion engine (ICE) technology is its ability to deliver near-zero tailpipe CO2 emissions with limited disruption to existing fleet operations. The technology requires only targeted modifications to conventional diesel engines – covering fuel injection systems, ignition, turbocharging, and piston subassemblies – while retaining the core engine architecture. This enables continued use of existing supply chains, service infrastructure and technician skill sets.
From a total cost of ownership (TCO) perspective, the economics remain contingent on hydrogen prices. For a 35 tonne truck over an eight-year life cycle, TCO at current hydrogen costs of Rs 750 per kg stands at Rs 102.52 per km, significantly higher than diesel at Rs 45.09 per km. However, at a projected hydrogen cost of Rs 200 per kg, TCO declines to Rs 45.65 per km, nearing parity with diesel. The scenario is dependent on the cost of green hydrogen prices, which are currently around $5 per kg and are expected to decline towards $1 per kg by 2030, driven by falling renewable energy costs, improvements in electrolyser technologies and scaling of production capacity from about 90 million metric tonnes (mmt) to 130 mmt.
Hydrogen ICE also offers threefold higher fuel efficiency than diesel on an energy-equivalent basis and avoids reliance on imported critical minerals, strengthening its relevance from an energy security standpoint.
Market constraints in the market
Three interlinked constraints currently plague the hydrogen mobility segment: high hydrogen costs, limited refuelling infrastructure and elevated vehicle capital costs. These challenges are interdependent and require parallel resolution.
On cost reduction, the pathway to approximately $1.60 per kg involves a mix of policy and technology interventions, including waivers on interstate transmission and distribution charges, a reduction in GST from 18 per cent to 5 per cent, lowering electrolyser costs to $125 per kW by 2030 through scale, and a continued decline in solar power costs. Policy support is expected to play a near-term role, while manufacturing scale and localisation will drive long-term reductions.
On infrastructure, the government’s initial mobility pilots – covering 37 vehicles (15 fuel cell electric vehicles [FCEVs] and 22 hydrogen ICE trucks) and 9 refuelling stations across 10 routes – aim to address the demand-supply gap. With an allocation of Rs 2.08 billion, these pilots are intended to generate operational data on performance, refuelling economics and technical feasibility.
On vehicle costs, the fuel cell stack and hydrogen storage system together account for about 60 per cent of an FCEV’s cost, with most components currently imported. Technology advancements, including platinum group metal-free cathodes, high-temperature membranes, and Type IV carbon-fibre tanks, are expected to reduce fuel cell stack costs by 80 per cent between 2014 and 2030.
Global experience
International experience across Japan, South Korea, China, the US and Europe indicates that hydrogen mobility scale-up requires coordinated ecosystem development.
In Japan, a large industry consortium addressed demand creation, cost reduction and funding simultaneously. In China, city-cluster deployment combined with local manufacturing reduced electrolyser costs significantly. In Europe, public transport applications created anchor demand to support infrastructure investments. Across markets, the initial focus has been on fleet-based, heavy-duty applications.
For India, the implication is clear: progress will depend on a coordinated approach involving government, original equipment manufacturers, energy companies and financial stakeholders. The ongoing pilot projects across multiple corridors are expected to provide the first set of insights into the viability of such a framework.
Based on presentations by Sudeep Dalvi, Senior Vice President and Director, Toyota Kirloskar Motor; and Yogesh (G) Bolar, Head Engine Development, Ashok Leyland, at the 11th Green Hydrogen in India conference organised by Renewable Watch.
