Hydrogen vs Batteries: Which Wins Zero-Emission Transport?

One of the largest global sources of greenhouse gas emissions (GHG) is transportation. It accounts for about one-fourth of global energy-related CO2 emissions, contributing significantly to global warming and leading to health risks, biodiversity loss, ecosystem disruption, reduced agricultural productivity, and infrastructure damage.

To mitigate the negative effects of the transportation sector, the industry and governments worldwide have been promoting vehicle electrification. One of the key technologies in transportation decarbonization efforts is battery electric vehicles (BEVs), which are energy-efficient, produce no tailpipe emissions of harmful pollutants, lower fuel and maintenance costs, reduce reliance on fossil fuels, and strengthen energy security.

Given the many benefits of BEVs, the electrification trend drove a massive wave of investment in battery gigafactories, EV platforms, charging infrastructure, and software ecosystems. In fact, the world’s leading automakers collectively committed more than $1 trillion toward the EV transition.

On the regulatory front, the UK and the EU shared plans to phase out internal combustion engine (ICE) vehicles over the next decade.

The US introduced the Inflation Reduction Act, offering tax credits for EV purchases, while China announced NEV mandates that encompassed BEVs, plug-in hybrids (PHEVs), and fuel cell vehicles (FCEVs), and poured billions of dollars into the sector.

As electrification became the dominant strategy to reduce emissions, global EV sales exceeded 23 million in 2025, representing more than 25% of global auto sales, up from about 20% the previous year.

Just six years ago, EVs accounted for a mere 4.4% of global car sales, and now they are projected to surpass 40% by 2030. This growth is led by China, where one in 10 cars is now electric. According to IEA projections, by 2030, almost one in three cars on China’s roads will be electric, and almost one in five in both the US and the EU.

“Our data shows that, despite significant uncertainties, electric cars remain on a strong growth trajectory globally,” said Fatih Birol, Executive Director of the IEA, last summer, expecting “more than two in five cars” to be EVs by the end of this decade as “EVs become increasingly affordable.”

Affordability, for now, remains an issue. In the US and Europe, BEVs are still 20% to 30% more expensive than their petrol counterparts. While battery prices have fallen significantly, more than 89% since 2010, thus dramatically lowering EV costs, the cost gap remains simply too wide still for many lower-income drivers.

Supply issues are also contributing to affordability challenges, with tariffs, changing trade rules, volatile prices, and geopolitical uncertainty affecting the availability and cost of raw materials like lithium, nickel, cobalt, and copper.

Then there’s the issue of charging access, with infrastructure development lagging in rural areas and even urban settings without private charging options.

Survey reveals that U.S. consumer interest in EVs has also been declining, with only 18% “very likely” or “likely” to buy a new or used EV in 2024, down from 23% the year prior. Notably, 63% were “unlikely or very unlikely” to buy an EV as their next car purchase.

Amidst this backdrop, automakers have started adjusting EV timelines. They are either delaying their EV programs, cutting down their EV investment, or cancelling their projects.

The pace of EV growth “slowed substantially in 2024 and essentially plateaued in 2025,” states a recent update on the US battery industry “amid EV bust” from the Federal Reserve Bank of Dallas. “Despite efforts to introduce EVs of sufficient quality and low enough price to convince U.S. consumers to switch en masse from gasoline-powered cars, automakers couldn’t get more buyers to do so.”

On top of it all, countries have begun easing their electrification targets. With China’s EV industry maturing, it is no longer supporting NEVs in its 5-year strategic development plan for 2026-2030 and is also phasing out subsidies that fuelled a boom, now leaving it with a vast oversupply.

Meanwhile, the Trump administration has taken a U-turn on electrification, ending the EV tax credit scheme. Even the EU has relaxed its emission standards, which consultancy Benchmark Mineral Intelligence (BMI) data manager Charles Lester said turned the global EV market into a “virtually unrecognisable landscape.”

As a result, global EV registrations, which grew by 20% last year, are expected to slow in 2026. This was already seen in the December numbers, which recorded the smallest sales increase since February 2024.

As sentiments toward BEVs weaken, could it be the time for hydrogen to shine?

Hydrogen’s Promise: The Lightweight Energy Carrier for Hard-to-Electrify Transport

Hydrogen is often seen as the “second pillar” of zero-emission mobility, especially where batteries struggle.

The lightest gas in the universe, hydrogen, weighs almost nothing while having an extremely high gravimetric energy density (MJ/kg). So, just one kilogram of hydrogen contains tremendous amounts of energy, making it an efficient energy carrier.

But the energy content of hydrogen per unit volume is much lower than that of other fuels, making it challenging to store and transport. Under normal conditions, hydrogen gas requires a lot of space; as such, liquid hydrogen is used as an energy carrier for sustainable trucks and aircraft.

Hydrogen isn’t of just one type, though; it can be produced through various methods, with each one having distinct environmental impacts. Among these, green hydrogen is the key enabler of the transition to sustainable energy. It is produced using renewable energy sources such as solar, wind, or hydropower.

When water is electrolyzed using renewable electricity, no greenhouse gases are released. This hydrogen can then be used as a clean energy carrier in technologies like Fuel Cell Vehicles (FCVs), which combine hydrogen with oxygen from the air to produce electricity that powers the electric motor, with water vapor as the only emission.

However, a vast majority of hydrogen currently comes from not-so-clean sources. It is primarily generated through steam methane reforming.

But “while the uptake of low-emissions hydrogen is not yet meeting the ambitions set in recent years – held back by high costs, uncertain demand and regulatory environments, and slow infrastructure development,” IEA has stated that, “there are still notable signs of growth.”

It’s worth noting that even the greener alternative, like electrolysis, is only as clean as the grid powering it, though that is true for BEVs too. BEV emissions depend on the grid that charges them.

But what makes hydrogen impressive is its ability to refuel fast, only taking a few minutes, offering long driving ranges, and providing high power density that makes hydrogen promising for applications like heavy-duty trucking, buses, ships, aviation, and industrial equipment.

The problem is with energy loss; only about 25% to 35% of the energy actually goes to the wheels, while BEVs boast about 70-80% efficiency. Then there’s the cost: hydrogen remains pricey. While the production cost is around $ 5/kg, it actually costs over $20/kg at the pump, though subsidies can help bridge this gap.

As per IEA estimates, renewable hydrogen could become cost-competitive in China by the end of this decade, thanks to low technology costs and cost of capital. China is actually the driving force in electrolyser deployment and manufacturing, accounting for 65% of global installed capacity and nearly 60% of global electrolyser manufacturing capacity.

Besides high costs, hydrogen as an alternative fuel faces a shortage of refueling stations. In fact, the industry only recently reached the milestone of surpassing 1,000 hydrogen refuelling stations in operation worldwide. In comparison, the number of public EV charging points reached 3.9 million at the end of 2023 and has now surpassed 7 million.

These limitations have led some automakers, such as GM and Stellantis, to scale back or cancel their hydrogen fuel-cell vehicle programs.

But at the same time, several automakers are still proceeding with their FCEV plans. This includes BMW Group. After the successful global testing of its pilot fleet, BMW has announced plans to introduce its first-ever series-production hydrogen-powered FCEV, the BMW iX5 Hydrogen, in 2028. Hydrogen will provide an additional energy source to the existing e-mobility range, helping stabilize the energy system as a whole.

Hydrogen, according to Joachim Post, Member of the Board of Management of BMW AG, “has an essential part to play in global decarbonisation, which is why we are committed to driving the technology forward.”

At the core of the BMW iX5 Hydrogen is the third-generation fuel cell system, developed in partnership with Toyota. The Japanese automaker was responsible for launching the first mass-produced HFCV, the Toyota Mirai, and is currently focused on advancing the potential of liquid hydrogen technology.

Honda Motor (HMC -0.98%) is another leading automobile company working with hydrogen technology. In June 2024, it began producing the Honda CR-V e:FCEV.

Hyundai is also advancing its hydrogen efforts. Late last year, it announced its all-new NEXO, which delivers 190 kW total output thanks to its new PE system that doubled battery output, working together with a more efficient hydrogen fuel cell stack that increased output by 16%. The vehicle has an estimated driving range of 826 km from a five-minute charge.

Most recently, Renault’s Alpine unveiled its fully operational hydrogen V6 prototype, which hit a 9,000rpm redline while emitting only water vapor.

The hydrogen-powered concept supercar, Alpine Alpenglow, has been under development for a few years and has been turned into a functional machine that produces 740 bhp and can reach a maximum speed of 205mph.

In order to build the 3.5-liter twin-turbo V6 engine, the team has to address the combustion characteristics of hydrogen, which burns extremely fast. To handle the gas, they added a small pre-chamber and a regulator, allowing the engine to produce high power while releasing only steam. It also features three storage tanks and a lighting signature to show the different stages of the internal combustion hydrogen motor.

These efforts show hydrogen’s potential in playing a larger role in the transition to sustainable transportation, but it needs sustained investment, public-private partnerships, and government incentives to drive development and adoption.

While limited, policy support for hydrogen has been slowly growing through the Hydrogen Hubs Program, $3/kg hydrogen subsidy, the Technology Roadmap for New Energy Vehicles, the Future of Freight Plan, and the EU Hydrogen Strategy.

These initiatives could help the global hydrogen fuel cell vehicle market reach its projected value of $110.18 billion by 2035, up from $2.20 billion in 2025. Here’s how the two zero-emission pathways stack up:

Hydrogen vs Batteries in Zero-Emission Transport

Investing in Hydrogen Technology

The UK-based Linde plc (LIN +1.14%) is an industrial gases and engineering company that serves a wide range of end markets, including electronics, metals, manufacturing, healthcare, food and beverage, mining, chemicals, and energy. Linde, along with Air Liquide SA and Air Products and Chemicals Inc., control 70% of the $120 billion global market for industrial gases.

It is also deeply involved in clean energy through the production of green hydrogen and carbon capture systems, which are crucial to the energy transition.

The company has spent decades building practical hydrogen solutions, from efficient compression systems to safe refueling systems, including Ionic Compressor, Cryo Pump, and IC FuelBox.

For the efficient and cost-effective delivery of hydrogen, Linde offers its pressure swing adsorption (PSA) technologies, including a custom membrane/permeation technology that enables the most abundant element to use the existing natural gas pipeline for supply. Its product enables hydrogen to be extracted at purity levels above 99.99%

Linde has already engineered more than 900 adsorption plants worldwide, including over 500 H2 PSA plants.

In addition to providing end-to-end solutions to increase green hydrogen production capacity in electrolysis projects, the company operates the world’s first commercial hydrogen cavern, supplying H2 to its customers during periods of planned and unplanned peak demand.

These capabilities have translated into major infrastructure projects. Back in 2024, Linde signed an agreement with Shell to build a 100-MW renewable hydrogen plant in Germany, with commercial operations expected to begin next year. Then last summer, it secured a deal to supply gases to an ammonia facility, for which Linde will add to its existing hydrogen and syngas infrastructure.

Linde is also designing, constructing, and operating a new facility that will provide a Hydrogen Refueling Station (HRS) with high fueling throughput and publicly accessible fueling options.

This is the result of the Department of Transportation (DOT) and the Federal Highway Administration (FHWA) awarding almost $25 million in grant funding to the Port of Houston Authority as part of a public-private partnership between the governmental subdivision and Linde to construct and operate a hydrogen fueling station in Bayport, Texas, for heavy-duty trucks.

Given Linde’s focus on clean energy, extensive high-density pipeline networks, a strong track record of operational efficiency, and long-term contracts, it has been enjoying strong market momentum.

The shares of the $223 billion market cap Linde have been trading at $481.55, up 12.94% YTD. Just earlier this month, the stock price surged past $510 to hit a new all-time high (ATH). It has an EPS (TTM) of 14.60 and a P/E (TTM) of 32.98.

As for its financial performance, the company reported its fourth-quarter 2025 results, during which sales jumped 6% YoY to $8.8 billion, operating profit rose 4% YoY to $2 billion, and operating cash increased 8% YoY to $3 billion. Adjusted EPS was $4.20.

Its net income dropped 11% to $1.5 billion due to purchase and restructuring charges from the Linde AG acquisition. Segment-wise, Linde’s sales in the American region were up 8%, driven by both higher pricing and volumes, mainly in the electronics end market. The 6% growth in the EMEA (Europe, Middle East & Africa) region was due to increased volumes in the electronics and chemicals & energy end markets, including project startups. In the APAC region, 3% increase was due to higher pricing, mainly in the chemicals & energy end market.

For the entire 2025, Linde sales came in at $34 billion, an increase of 3% YoY, while its operating profit was $8.9 billion and operating profit margin was 26.3%. Adjusted EPS for the year was up 6% YoY at $16.46. The company also reported operating cash flow of $10.4 billion, capital expenditures of $5.3 billion, and a backlog of $10 billion. Meanwhile, $7.4 billion was returned to shareholders through dividends and share repurchases. Linde pays a dividend yield of 1.33%.

For the current quarter, the company expects its adjusted EPS to grow between 6% and 9%, to $4.20 – $4.30. As for the full year, it forecasts adjusted EPS between $17.40 and $17.90.

Talking about “another year of resilient performance,” CEO Sanjiv Lamba said the results “underscore the strength of our operating model.” He added:

“With disciplined capital allocation, strong network density, and an increasing project pipeline, Linde is well positioned to capture high-quality wins in 2026 and continue to create shareholder value regardless of macroeconomic uncertainties.”

Latest Linde plc (LIN) Stock News and Developments

Conclusion

Driven by climate policy, falling battery costs, and massive investment, the EV boom has been playing a key role in the much-needed transition to clean transportation. But slowing adoption, fading government support, and weakening consumer interest are now opening the door for hydrogen to gain traction.

While hydrogen is unlikely to replace BEVs anytime soon, this versatile energy carrier can play a critical role in the race to decarbonize industries, especially for sectors where batteries struggle, such as heavy trucks, aviation, shipping, and high-performance vehicles.

Click here to learn why hydrogen still might be the fuel of the future.