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The potential market for hydrogen and fuel cell systems is enormous. As a world leader in the research and development of hydrogen and fuel cell technologies, Canada is positioned to benefit significantly as the market develops to its full potential.

Market Overview

The markets for fuel cells are diverse and the worldwide revenue potential substantial, with global demand projected to reach $18.6 billion by 2013.

It's expected that regions such as Europe and Japan will be early adopters because of immediate environmental, economic, and energy diversity and efficiency benefits. In North American, the development of hydrogen and fuel cell technologies is being driven by the US's need for a secure, diverse and more environmentally sound energy supply. However, the low cost of energy in North America presents an additional challenge in the full-scale commercialization of hydrogen and fuel cell technologies.

In the long term, the need for stationary, portable and mobile power applications will be extensive in underdeveloped countries with growing populations and less developed conventional energy infrastructure. Countries such as China and India, who are expecting double-digit growth in energy demand in the future, have more urgent requirements for energy supply in large urban areas and off-grid communities. These countries are expected to be early adopters as well.

Portable Market

Portable fuel cells with their initial high cost, will find early uses in wireless handsets, laptops, and PDAs. The two biggest market segments are the cellular phone and the laptop markets, worth more than $2 billion a year. Moderate forecast put the portable fuel cell market in 2007 at 500,000 units, rising to 200 million units by 2011.

Stationary Market

Stationary applications are expected to reach large-scale production first as they require less immediate infrastructure because they use existing fuelling infrastructures - predominantly the extensive natural gas distribution network. Global demand is projected to increase from $4,050 million in 2010 to $7,500 million in 2013.

Mobile Market

As Canada's car market is relatively small, the bulk of our economic success with mobile fuel cell applications will be globally driven. The Asian market's growing demand for small mobile devices such as motorbikes and scooters presents considerable opportunities for the Canadian fuel cell industry.

The 2013 global market for mobile fuel cells is estimated at $3,600 million. As the cost of fuel cell vehicles drop, they will become increasingly competitive with conventional vehicles. Mass-market adoption is expected between 2015 and 2020 However, it may be several more years before all new vehicles have fuel cell engines, as it will take time for manufacturers to ready their facilities for producing these new cars.

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Early Adopters

Much of the early demand for hydrogen and fuel cell technologies is expected to come from institutional and government buyers willing to pay a premium to support the industry's development, promote alternative energy sources, and demonstrate the benefits for society. This is already the case in Europe and Japan.

Early adoption by the Canadian federal government can help ensure the success of new technologies by acting as a bridge between pilot programs and cost-competitive commercial offerings. Early applications of hydrogen and fuel cell technology could include public buses, industrial uses, residential fuel cells for powering government buildings, and power generation in remote communities. Canada's Department of National Defence is also interested in the military applications of hydrogen and fuel cell systems.

With the resources needed to evaluate and adopt new technologies that can improve performance and meet specialized needs, the US military is another good candidate for early adoption. In fact, the US military has shown interest in a number of Canadian companies and their fuel cell applications.