Fuel Cell Industry ESG Thematic Report, 2023

Environmental, Social, and Governance (ESG) in the Fuel Cell Market

Environmental, Social and Governance (ESG) are three individual parameters that impacted the investment trend in the new era, where investors, companies and government are making policies towards betterment in these areas.

The exhaustion of fossil fuels as well as the down sides of producing lithium-ion batteries has led to search for much more efficient fuels to power the transport and stationary infrastructure, thereby reducing the carbon footprint on the environment. The said process has paved the way for the fuel cell industry which primarily focuses on this aspect by producing the fuel cells, making infrastructure more sustainable in terms of environment.

The innovative technology of using renewable Hydrogen as a fuel source is a leap in terms of powering the infrastructures, using the hydrogen as a component in the functioning of fuel cells is considered as efficient by the leaders in the industry.

ESG Trends

One of the key advantages of fuel cell industry is that the products which are used for the powering stationery and transport infrastructures doesn’t produce any emissions, making the net zero target possible. The fuel cells, unlike the conventional energy sources, which produces more carbon dioxide as a by product, produces air-oxygen and water as by products, which reduces already existing carbon footprint, which has 36 billion tons of co2, produced by the said conventional energy sources, contributing to climate change by reducing the rising global warming temperatures, there by contributing to the UN SDG’s goals of sustainable development.

Despite the redefining technology, there are certain challenges in the market in terms of environment, slightly contradicting the very purpose of the production. The global value chain of the significant component hydrogen leaves the environment strained.

Around 96% of the hydrogen produced for powering the fuel cell is extracted from the current natural gas as well as the biomass, straining the current left overs of natural resources. A report states that the production of hydrogen from renewable sources creates 30 million tons of CO2 every year, basically offsetting the climate change through products.

Further the storage and transportation of the hydrogen still involves the conventional and existing mode of energy, adversely contributing to the carbon footprint, making it grey hydrogen. Inefficient global value chain i.e., the production, storage and transportation of the hydrogen fuel can harm the stratosphere ozone, since the molecular hydrogen easily moves up to the stratosphere, when contacted with the ozone, produces the water, dampening the stratosphere ozone.

Besides the aforementioned impacts, the usage of platinum in the fuel cells i.e., Proton Exchange Membrane Fuel Cells (PEMFC’s) as an electrocatalyst involves high production cost as well as platinum mining, which increases the CO2 emissions and waste water as a part of mining. The high production cost means higher the price of fuel cell, which creates a socio economic barrier i.e., the affordability of fuel cells will go down, impacting the social as well as the environmental aspects of ESG.  

Growth Of The Fuel Cell Market:

Driving factors such as ecological sustainability and incline in demand for environmentally friendly energy sources are the driving factors in the relevant market. As of 2020, the fuel cell market at global scale is valued at USD 4.1 billion with a compound annual growth rate of 23.2% from 2020 to 2028. Governments across the world are encouraging the business entities as well as the consumers to sell and purchase by making policies, laws, and regulations to increase the production of fuel cells and to move towards green energy, thereby enabling to meet the UNSDG’s climate change goals.

Key Companies in this theme:

    • Fuel Cell Energy, Inc.

    • Ballard Power Systems

    • SFC Energy AG

    • Nedstack Fuel Cell Technology B.V.

    • Bloom Energy

Scope of the Fuel Cell Industry ESG Thematic Report:

    • Macro-economic and ESG-variable analysis of the industry, including regulatory, policy, and innovation landscape

    • Key insights on infrastructure developments and ESG issues affecting the theme

    • Identify key initiatives and challenges within the industry

    • Identify ESG leaders within the industry

    • Understand key initiatives and the impact of companies within the sector to fuel an informed decision-making process

    • Analysis of industry activities based on multi-media sources, including significant controversies and market sentiment

Key Benefits of Fuel Cell Industry ESG Thematic Report:

    • Offers a global perspective of the industry and the policies and measures taken by the players, for overcoming the challenges faced in terms of Environment, Social and Governance.

    • Key insights into the sustainability practices of major players in the market.