The UK’s Hydrogen Bus “Fire Sale”: From a Promising Project to a 1-Pound Dump Sale – What Exactly Did We Lose?
Hello everyone, I’m your financial journalist. Today, we’re going to discuss a rather unfortunate incident that happened in Aberdeen, UK, but behind this story lies a significant revelation about the global energy transition.
In simple terms, the UK’s once-praiseworthy hydrogen bus fleet has completely failed, and it did so in a rather humiliating manner.
These 25 hydrogen-powered double-decker buses, which were once hailed as a model for future transportation, are now not only unwanted but also being sold at heavily discounted prices. Buses that originally cost £13.9 million (approximately 130 million RMB) are now being sold for just £816,000 (about 7 million RMB each), a reduction of 94%, which is essentially a 50% discount. Ironically, some people were even willing to pay just £1 for one of the buses, and it was only after a company offered £30,000 per bus that the city council decided it was a “fair deal.”
This is not just about the loss of a few vehicles; it marks the end of an era: in the field of public transportation, hydrogen may simply not be competitive with electric vehicles.
Let me break down this story into five key points to explain the logic behind it in plain language.
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1. From a “Global Model” to “Garage Zombies”: What Happened to These 25 Buses?
To understand this story, we need to look at how impressive they were initially.
In 2021, the city of Aberdeen (a major oil and gas hub in the North Sea) made a big move by introducing 15 hydrogen-powered double-decker buses. At that time, these were among the earliest large-scale commercial operations of hydrogen buses in the world, and the media hailed them as a star of the energy transition. Another 10 buses were added in 2022, bringing the total to 25. Aberdeen had big ambitions, hoping to build a complete industrial chain from “green hydrogen production” to “hydrogen refueling stations” to “hydrogen-powered transportation,” and they even partnered with BP, expecting to create 700 new jobs.
But dreams are one thing, reality is another.
The problem lay with the infrastructure. Hydrogen buses are easy to drive, but hydrogen refueling is not. In the second half of 2024, the local hydrogen refueling facilities stopped operating due to equipment failures and parts shortages. Without hydrogen, these 25 “star buses” became useless and were left sitting in the garage, gathering dust. It wasn’t until March of this year that the city council decided to abandon the project and switch to all-electric buses.
Key Point: It’s like buying a bunch of luxury cars only to find that there’s only one gas station in the whole city, and that station is often out of service. No matter how good the cars are, if there’s no fuel (hydrogen), they’re just useless. The biggest challenge with hydrogen buses is not the buses themselves, but the vulnerability of the hydrogen refueling network and the high maintenance costs. Once the supply chain breaks down, the entire system fails.
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2. From £13.9 Million to £816,000: How Did This Costly Mistake Happen?
Let’s calculate the financial blow:
- Total Investment: Approximately £13.9 million (for the buses and related infrastructure).
- Total Recovery: Estimated at £816,000.
- Loss Rate: 94%.
- Loss per Bus: An average loss of £520,000 per bus.
Who are the buyers?
1. First Bus (operator): They spent £690,000 to buy 23 buses. Note that they didn’t buy them to continue using hydrogen; instead, they plan to convert them into all-electric buses.
2. GeoPura (a hydrogen company): They spent £126,000 to buy 2 buses for continued use in hydrogen-related applications (possibly for testing or special purposes).
Even more absurdly, besides these two companies, there were four others that offered bids. Two offered to “give the buses away for free and handle the disposal,” while another offered just £1 per bus. In comparison, First Bus’s bid of £30,000 per bus was considered a “good deal.”
Key Point: Why would First Bus pay £30,000 per bus? Because the conversion cost is lower than buying new buses, and electric vehicle technology is more mature and easier to maintain. For operators, converting hydrogen buses to electric ones is more cost-effective and allows for immediate operation. This also shows that hydrogen buses have almost no residual value in the second-hand market due to a lack of technical compatibility. Electric vehicle batteries can be replaced, and motors can be repaired, but hydrogen fuel cell systems become useless once they become obsolete.
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3. Why Are Hydrogen Buses “Doomed”? Because of Low Efficiency and High Costs
Many people might wonder: Isn’t hydrogen more environmentally friendly? Why give it up then?
Here’s a crucial concept: energy conversion efficiency.
- Electric Vehicles: Electricity from the grid charges the battery, which powers the motor, driving the wheels. The energy efficiency in this process can reach 70%-80%.
- Hydrogen Vehicles: Electricity from the grid/renewable energy is used to produce hydrogen through electrolysis, which is then compressed, liquefied, and transported. After refueling, it powers the fuel cells, which in turn drive the wheels. This process involves multiple losses, resulting in an overall efficiency of less than 30%.
To put it simply:
- Electric Vehicles are like drinking bottled water directly: simple, efficient, and inexpensive.
- Hydrogen Vehicles are like boiling water, freezing it, transporting it to the desert, and then melting it again to drink it: although the end result is the same, a lot of energy and money are wasted in the process.
The Cost Comparison is Even More Disheartening:
In China, the cost of producing green hydrogen (the most environmentally friendly type) is around 22-32 yuan per kilogram, while coal-based gray hydrogen costs only 12 yuan per kilogram. Even using the cheaper gray hydrogen, along with the high costs of storage, transportation, and refueling stations, the operating costs of hydrogen buses are much higher than those of electric buses.
Key Point: As experts from the University of Strathclyde said, “The failure of hydrogen bus projects is inevitable because their business and technical models simply don’t work.” In the transportation sector, especially for urban buses with frequent, short-distance, and fixed routes, electric vehicles outperform hydrogen in terms of cost, efficiency, and convenience. Hydrogen buses are like using a rocket engine to deliver food; the technology is impressive, but it’s not suitable for the task.
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4. Aberdeen’s “Let Go”: More Than Just Selling Buses, It’s a Strategic Shift
The Aberdeen city council’s decision wasn’t just about selling the buses; it was a complete strategic retreat:
1. Dissolving the Joint Venture: Aberdeen will acquire BP’s shares for a symbolic £1 and dissolve the joint venture that cost over £40.3 million. This means the government is no longer willing to support hydrogen projects.
2. Selling Hydrogen Assets: The facilities for hydrogen production, storage, and refueling will also be sold. GreenPower Company will acquire some of the facilities for about £1.3 million.
3. Stepping Out of the Hydrogen Valley: Aberdeen even plans to withdraw from the TH2ISTLE project in the Northeast of Scotland.
4. Reinvesting Funds: The money from selling the buses will be used to build one of the largest electric vehicle charging stations in Scotland.
Key Point: This is a clear signal that government funds are shifting from “hydrogen transportation” to “electric transportation infrastructure.” The decision-makers in Aberdeen have realized that the market trends have changed. Instead of continuing to invest in a doomed project, it’s better to stop losses and allocate resources to the more mature and efficient electric vehicle ecosystem. This also reminds us that policy-making should not be based solely on the glamour of new technologies but on commercial feasibility and market acceptance.
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5. Hydrogen Isn’t Dead, but It’s Just in the Wrong Place: Where Should It Be Used?
Finally, let’s clear up a misconception: Hydrogen isn’t a waste; it’s just being used in the wrong places.
A study by Nature magazine evaluated nearly 2,000 hydrogen projects worldwide and concluded clearly: Use electricity wherever possible.
- Areas Unsuitable for Hydrogen: Urban buses, private cars, building heating, short-distance transportation. In these areas, battery-powered electric vehicles or heat pumps are more efficient and cheaper.
- Areas Suitable for Hydrogen: Heavy industries that are difficult to electrify. For example:
- Steel Smelting: Using hydrogen to replace coke in iron ore reduction is key to reducing carbon emissions in the steel industry.
- Chemical and Fertilizer Production: Hydrogen is needed for producing ammonia and methanol, which are important chemical raw materials.
- Long-Distance Heavy Transportation: Such as cross-ocean shipping and long-distance freight trucks, where batteries are too heavy, hydrogen might be the only viable option.
Key Point: Hydrogen is a “industrial fuel,” not a “universal energy source.” It should be used precisely in areas where batteries are insufficient. Governments should stop blindly subsidizing hydrogen vehicles and heating systems and instead support pilot projects in industries like green steel and low-carbon ammonia, along with the necessary renewable energy infrastructure.
In Summary:
The tragedy of Aberdeen’s hydrogen buses is not a failure of hydrogen itself but a failure of the concept of hydrogen-powered transportation. It shows that in the energy transition, the choice of technology routes must be based on context and cost-effectiveness, not just the pursuit of a “high-tech” label. For the general public, it means that in the future, buses and cars will likely remain electric, while hydrogen will play a crucial role in industrial processes, such as in factory chimneys and ocean-going ships, where it can truly make a difference.
Thank you for listening to this analysis. If you have any questions, feel free to ask!