Defining TCO
TCO combines purchase price with all subsequent expenses: hydrogen or electricity costs, preventive and corrective maintenance, road or grid charges, financing costs, insurance and ultimately the asset’s resale value. For high-utilisation assets fuel costs alone can easily exceed initial capex within a year. Even small improvements in tank-to-wheel or tank-to-socket efficiency can therefore create large lifetime savings.
Fuel cells versus other zero-emission options
Battery-electric systems offer relatively low acquisition costs and can work well in urban or short-haul cycles where daily energy demand is moderate and charging infrastructure is available. When grid independence, higher uptimes or long operational autonomy is required, hydrogen could be a more attractive solution. Hydrogen combustion offers a lower acquisition cost than fuel cells, but they are significantly less efficient in converting hydrogen into electric energy. A modern PEM fuel-cell system, such as the zepp.X150, converts hydrogen into electric power with an efficiency over 50%. This has a significant positive impact on the TCO of the application.
TCO in practice
Let’s take trucks as an example. Below, you will find a link to our simplified version of the TCO calculator we use with our clients. It can be used to compare three drivetrains: diesel, hydrogen combustion and fuel cell-electric. You will find that with current fuel prices, diesel still wins on cost, that remains the case if local regulations and client requirements allow it. The real contest is between the two zero-emission choices. Our Europa tractor needs less hydrogen than the combustion engine truck to cover the same distance. Therefore, the longer it runs, the cheaper it becomes in comparison.
Road charges, tax breaks and schemes such as the Dutch SWIM subsidy narrow the gap to diesel even further. If you see the TCO comparison using the calculator above, or by making your own calculations, it becomes clear why several fleet operators have already placed orders for the Europa truck.
Stationary power: counting in euro per kilowatt-hour
In construction, maritime shore power or (temporary) grid backup the economic question shifts from cost per kilometer to cost per delivered kilowatt-hour. With the typically high uptimes these types of systems experience, it’s even more important to look beyond upfront capital expenses and take into account the effect increased efficiency has on the TCO.
TCO is the basis of your business case
Diesel remains the cheapest option where it is still permitted in most cases. Under specific operational conditions, fuel cell technology can be cost competitive, with an added benefit of zero emissions. However, in zero-emission zones or in specific operational conditions, the question is not whether hydrogen is cheaper than diesel, but which clean technology delivers the lowest TCO given your duty cycle, payload and local incentives. For long-haul freight the efficiency of a fuel-cell power-train like Europa’s often tips the scales. For stationary or maritime applications the combination of high efficiency, high power density and a long lifetime makes the X150 a strong contender.
An understanding of the total costs of ownership for the different technology options for your specific application is the basis of a well-informed investment decision. If you would like a detailed TCO breakdown for your own fleet, vessel or generator, send us a message through the contact form below.
