The government will significantly increase the hydrogen bus fuel subsidy from the current 3,600 won per kilogram to 5,000 won starting March 1 to reduce the burden on bus operators running hydrogen buses. This measure is part of the government’s policy support plan to expand eco-friendly transportation options and achieve greenhouse gas reduction goals.
The Ministry of Land, Infrastructure and Transport stated on the 23rd, “We decided to increase the subsidy to alleviate the burden of hydrogen bus fuel costs and promote distribution.” This measure follows the ‘Eco-friendly Vehicle Secondary Battery Competitiveness Enhancement Plan’ announced at the policy ministers’ meeting on January 15 and is one of the government’s active support measures to expand hydrogen bus distribution.
The government has set a goal to reduce national greenhouse gas emissions by 40% compared to 2018 levels by 2030, and plans to distribute 20,000 hydrogen buses by the same year. Since September 2021, hydrogen bus fuel subsidies have been provided. Considering that the nationwide average hydrogen sales price is about 10,000 won/kg, adjusting the subsidy upward was unavoidable.
However, the industry has pointed out that the introduction of hydrogen buses has been slow due to higher fuel costs compared to electric buses and a lack of charging and maintenance infrastructure. Currently, there are only about 54 large-capacity hydrogen refueling stations nationwide, while electric bus charging stations are available at each bus depot, showing a significant difference in accessibility.
As a result, the Ministry of Land, Infrastructure and Transport, after gathering feedback from the Ministry of Trade, Industry and Energy, the Ministry of Environment, local governments, and related industries, decided to increase the fuel subsidy to 5,000 won per kilogram. With this measure, the actual fuel cost burden for operators of hydrogen buses is expected to decrease by approximately 22%, from 6,400 won to 5,000 won per kilogram. Calculated for an annual driving distance of 90,000 km, the annual fuel cost is expected to decrease from about 34 million won to 26.5 million won, reaching a similar level to that of electric buses.
The Land Ministry also plans to open the ‘Fuel Subsidy Management System (https://www.uga.go.kr)’ to the public from March 4 to enhance the transparency of subsidy payments. This will allow anyone to check the status and payment details of the fuel subsidy system and report any fraudulent claims.
Um Jeong-hee, Director-General for Transportation Logistics at the Ministry of Land, Infrastructure and Transport, said, “It is important to secure competitiveness in the purchase, operation, and maintenance stages to promote the distribution of hydrogen buses,” adding, “We plan to continuously cooperate with relevant ministries and industries to develop long-distance operation models, alleviate hydrogen fuel cost burdens, expand nationwide charging and maintenance infrastructure, and reduce hydrogen production costs.”
The government also plans to accelerate the expansion of hydrogen refueling stations along with the distribution of hydrogen buses. Currently, there are a total of 54 large-capacity hydrogen refueling stations in operation nationwide, including those in Seoul (1 station), Gyeonggi (6 stations), Incheon (3 stations), Gangwon (2 stations), Chungbuk (5 stations), Chungnam (3 stations), Gyeongbuk (3 stations), Gyeongnam (8 stations), Busan (6 stations), and Ulsan (2 stations). The government plans to improve the operating environment for hydrogen buses and establish an eco-friendly public transportation system through infrastructure expansion in the future.
Attention is focused on whether this subsidy increase will become a turning point for the expansion of hydrogen bus distribution and whether it will lead to a substantial reduction in the industry’s burden.