Speak to a finance expert today - 0333 3583502

Hydrogen Vehicles

Hydrogen or Electric Vehicles?

Hydrogen vs Electric vehicles:

There is increasing debate over moving to electric vehicles over diesel and the benefits of this for the environment and lowering emissions as a whole. The debate centres around if it is feasible to have the infrastructure in place to fully commit to this practice, or if this would be too expensive and unrealistic to achieve. The debate recently has also started to consider hydrogen-fuelled vehicles as a more efficient alternative to electric vehicles.

How Hydrogen and Electric Cars Work:

With hydrogen-fuelled vehicles, there is a hydrogen tank which feeds a fuel cell with high pressured hydrogen gas which then mixes with oxygen. A reaction then occurs which produces electricity to power the electric motor. Hydrogen vehicles, therefore, have characteristics of both electric and petrol cars.

Electric cars, on the other hand, are powered by electric motors that pull current from a rechargeable battery, there is no chemical reaction in this process.

How they compare:

Driving range: 

Although we are in the early stages of research, it is emerging that hydrogen-powered vehicles have a longer driving range before needing refilling. Around 300 miles can be travelled in a hydrogen vehicle compared with just 100 to 200 in an electric one. Once we progress further into hydrogen vehicle research, it would make more economical sense from this point alone for individuals and businesses to favour hydrogen.

Powering/refuelling time:

The amount of time it takes to pump hydrogen into a tank is more similar to a standard petrol car, it takes 5 to 10 minutes. While some advanced electric vehicles such as Tesla can reach 80% charge within half an hour, many other electric vehicles can take 4 to 8 hours to be fully charged. Again, from this standpoint, hydrogen vehicles would make more economical and time-saving sense to businesses who perhaps need to charge/refuel a fleet of vehicles.

The manufacturing process:

While it is true that both types of vehicle are more sustainable and ecological, the manufacturing process of the actual vehicle remains much the same as any standard vehicle – this still brings with it a lot of energy consumption, raw material use, emissions from transporting goods, and use of natural gasses in processing. This is an area that needs more modification regardless of the preferred fuelling method.

To read more comparisons, click here.

To read a detailed piece on hydrogen vs electric, click here.

Hydrogen vehicles for the win?

Hydrogen fuel cells are already arguably more sustainable than the typical lithium-ion batteries from electric vehicles. These batteries have a limited life span and as it stands currently there is uncertainty around the future of used batteries. However, while they are hard to recycle, some projects are being developed to reuse them as backup generators in certain commercial use buildings.

Once hydrogen can be farmed sustainably (currently the most efficient method is extracting it from methane and other fossil fuels, even though this isn’t the most sustainable), it produces 0 emissions, has a faster refuelling process, and can drive a longer range. It has a lot of potential for individuals and businesses alike to consider. The infrastructure isn’t as far ahead currently as electric vehicles, however. It is incredibly likely to have more funding pumped into it in the coming years due to the rapid need as a collective for us to change our actions to reach net zero.

As things stand at the moment, hydrogen-powered cars have to use energy twice, once in the process of converting the hydrogen and then again to power the vehicles. While their electric counterparts use energy from the grid straight away.

It is a lot to consider for businesses looking to tick off ESG goals and become more sustainable – one thing is for certain though, both of these vehicles are more sustainable than those fuelled by petrol.

Depreciation Curves:

The depreciation rate refers to the percentage rate at which an asset is depreciated across its estimated productive life. The average car depreciation hits the hardest in the first year of ownership. This is something all business owners need to consider when looking into a new vehicle purchase, especially when looking into a fleet of vehicles.

Research has shown that hydrogen vehicles have a slower depreciation due to how they do not require a lithium battery that will eventually wear out like their electric counterparts. This piece here states how hydrogen vehicles have all the advantages of zero emissions and quick refuelling, so they are the most convenient and future proof technology.

Here are some slowest depreciating vehicles to consider in 2022: https://www.drivingelectric.com/best-cars/1810/slowest-depreciating-electric-and-hybrid-cars

A quote from Allica Bank on Asset Finance and Vehicle Purchase:

 “The financial and environmental benefits of having a green fleet aren’t lost on most business owners. In my experience, often the main barrier to businesses going green isn’t ambition, but having the cashflow to do so in the first place.

That’s why many business owners decide to use asset finance, as it means they can go green without creating a huge dent in their cashflow. Asset finance allows that upfront cost to be spread over a fixed term, with a set amount being paid each month to use the vehicle. Then, when you’ve made the last repayment, it belongs to you. 

The length of the term can vary depending on the asset and business need. For example, at Allica you could acquire an electric car or light commercial vehicle (LCV) with a term of up to five years, while a heavy goods vehicle could have a term of up to seven years. 

This is where using a broker to find the right asset finance product and provider can be especially handy. They’ll take the time to understand your business requirements and get you the best terms from the whole market. With each funder often offering slightly different terms, a broker can also handle a lot of the nitty gritty detail of the application for you, leaving you to get on with managing your business throughout the process until the new green vehicle parks up on your premises for the first time.”

Arshad Miah – Business Development Manager, Asset Finance at Allica Bank

Our companies actions:

  • As mentioned in Issue 2 of the Green Guide, one of our directors has an electric vehicle while one of the others runs a hybrid
  • We are always looking for new ways to improve our sustainable practices
  • We look to support sustainable businesses with funding to improve their ESG performance, please get in touch if we can help you finance greener vehicles

We’re always looking to support more green businesses and initiatives when it comes to funding – if the business you run has green and sustainable practices and you need funding, don’t hesitate to get in touch today!

How does your business focus on sustainable practices when it comes to green energy and emissions? Let us know, we’re always looking to improve!

Thanks for signing up and reading! Stay tuned for issue 4 in 2 weeks!