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Japan plans ample support for fuel cell car technology

By Yoko Kubota

TOKYO (Reuters) - The Japanese government is planning to offer ample support to popularize fuel cell vehicle technology as Toyota Motor Corp and Honda Motor Co prepare to launch hydrogen-powered cars in 2015.

The government on Thursday drafted a timeline that spelled out targets and actions over the next 25 years to commercialize fuel cell vehicles and boost use of hydrogen energy in general.

The move comes as Japan's ruling Liberal Democratic Party considers supporting the technology through subsidies and tax breaks, so that by 2025 fuel cell vehicles can sell for around $20,000 or a little more, the same price as popular gas-electric hybrids.

A fuel cell vehicle, which runs on electricity generated from cells that combine hydrogen with oxygen, emits only water vapor and heat. The vehicles can run five times longer than battery-operated electric cars, and their hydrogen tanks can be filled in just a few minutes.

But they are expensive, and the lack of fuelling infrastructure could get in the way of a successful commercialization. In Japan, just a handful of hydrogen fuelling stations have been built due to strict safety regulations, high costs and the unclear outlook for demand.

The government aims to cut the price for building a hydrogen fuel station by half to around 200 million to 250 million yen ($2 million-$2.45 million) by 2020, the draft showed.

Japan also aims to have around 100 hydrogen stations in operation by end-March 2016, up from 17 now, the draft said.

The timeline, which will be finalised in about a week, does not include fuel cell vehicle sales targets or details on how much in incentives will be offered to car buyers.

Separately, the ruling party, which is also compiling policy recommendations to boost hydrogen energy use, is considering annual sales targets of 40,000 fuel cell cars by 2020 and 400,000 by 2030, a draft showed.

Toyota, which plans to start selling its new fuel cell car next year in Japan, the United States and Europe, aims to popularize the technology as it did the Prius, which it launched in 1997 to become the world's top-selling hybrid vehicle.

The company, which is set to brief reporters on June 25 about its fuel cell vehicle development, has said the car could be priced as low as around $50,000 excluding subsidies. The Prius hybrid starts from around $21,600 in Japan before tax breaks.

(editing by Jane Baird)

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