A new working paper by Statistics Norway suggests that governments should not provide subsidies for the introduction of hydrogen cars. According to the study, the current state of hydrogen-car technology is such that only funding for research and development is appropriate.
 
The study, entitled "Lock-in and the transition to hydrogen cars: When should governments intervene?" examines what role, if any, governments should play in the development of hydrogen-car technology and infrastructure.

The authors argue that hydrogen technology needs a lot of further development, given that the fuel cells needed to convert hydrogen into energy are expensive and unreliable, while the problem of storing hydrogen in cars has only partly been solved. Therefore, the researchers believe that "endorsement of the hydrogen car with infrastructure subsidies or subsidies to hydrogen car buyers do not look especially desirable." Instead, the working paper suggests that governments should concentrate on R&D in order to solve the most serious technological weaknesses.
 
The researchers rejected claims that active support to the hydrogen car was needed to help advance the technology, arguing instead that the "greatest technological challenges to the widespread use of hydrogen cars, hydrogen storage and fuel cells, could develop in niche markets like the markets for cell phones and laptops."

Overall, the researchers concluded that governments should let the market settle the matter and only worry about imposing proper carbon taxes on fossil fuels so that the costs of these fuels better represent their true costs.
 
A copy of the paper can be obtained from Statistics Norway: http://www.ssb.no/english/