Project Beaver, Hydrogen Trucks, and The Ever-Elusive Chase for Investment

Noah Note

Another day, another sorta-kinda addition to the CPSP economic conversation. Everytime I try to write about this, I find myself having to go back as new announcements are made. This isn't exactly that, we knew Hydrogen developments was Hyundai Motors toss into the competition, but Judy Trinh and the CTV were given the exclusive rundown on what exactly this looks like.

To quote the article on Project Beaver:

“According to the outline seen by CTV News, phase one is set for a 2030 start and would involve the construction of a hydrogen liquefaction plant in British Columbia, which would turn the gas into liquid. Thirty-two charging stations would be built in B.C. and Alberta, while a hydrogen transport vehicle manufacturing plant would likely be constructed in Ontario.

After 2035, 160 more charging stations would be added. There is also the possibility that Canada could help South Korea manufacture its hydrogen trains, currently in testing, for future export.”

A token contribution from Hyundai Motors, for a niche, non-existent demand. I apologize if I sound mean or harsh. Truthfully, I am not a Hydrogen Head. I have a weird relationship with hydrogen. To me, and all I know, it remains merely another side project in the energy space. Less efficient than battery or ICE vehicles, with limited public infrastructure available, and almost zero demand.

I know it's different for the trucking industry. I was actually debating this topic with someone else in the industry who would love a Class 8 hydrogen over a heavy battery system. I am still unconvinced it will be a growing trend, though. I am happy to be proven wrong. The prohibitive upfront cost, the efficiency loss compared to battery systems; I just ain't convinced.

Don't get me started on hydrogen trains, either. I love trains. I want all the trains. Hydrogen trains, to me, are the cheap, ruinous alternative to people not confident enough for battery systems, or better yet, putting up the bloody wires and saving everyone the time and trouble of an overtly complex line.

I don't mean to hate on hydrogen. I think hydrogen is great, easily a top 5 element. I can't shake the concept, though, that hydrogen only exists in many conversations to either avoid other renewable sources or as a fancy workaround with grey and brown hydrogen to try and greenify oil and gas developments. None of which are either efficient, effective, or competitive with the alternatives.

This very much is another case of such a phenomenon. Hyundai Motors did not want to participate here. We all know that. They were hesitant in the existing market to invest billions in Canada under the guise of supporting CPSP, both with ongoing tariffs and, as mentioned, the opening of Canada’s EV market to Chinese competitors, another development poised to taint a lot of potential investments if they even had a chance.

Hyundai, in turn, does care for hydrogen developments. They are one of the leading manufacturers trying to make the concept work. The 2026 NEXO, to its credit, is a really cool vehicle and I hope to see it succeed. Although the primary focus, even if not named, seems to be bringing the XCIENT Fuel Cell to Canada.

That apparently does include a Canadian production chain for the platform in Ontario, with a focus on building out a hydrogen ecosystem in the Prairies, likely tied to further energy developments by both Hyundai and Hanwha on carbon capture and utilization.

Hanwha Power has recently signed an MOU with Pembina Pipeline, the University of Alberta, and Hanwha with the Government of Alberta itself to explore potential cooperation in low-carbon energy solutions. While not mentioned directly, I wouldn't be shocked to see blue hydrogen get the nod here as well as part of a broader South Korean effort.

We also know that Hyundai is exploring the possibility of a Canadian facility similar, though smaller, to their recent $6 billion USD investment in a new innovation hub in Gunsan City. While I have zero details, and its omission here leaves me curious, I am told such a facility is still in the plans, though again not quite to this scale.

It doesn't really change the facts, though. Hyundai is doing this not fully out of personal desire, but after significant pressure from the Korean government to participate in the CPSP bidding process, more specifically to try and get something, anything related to automotive investments on the cards.

If there was a token choice of token choices, this would be it. It is not born out of Canadian demand, nor Hyundai's desires to expand into Canada. It is something they pulled that was viable that could be thrown into the books, after months of intense back and forth with their own government pressuring them to show up.

Automotive is important to many in the federal government. Not only is it a major employer and economic driver, it is also an industry seen as critical to national defence. It is an industry that, once capacity is lost, it is extremely difficult, if not impossible, to regain.

Look to Australia here. The loss of automotive, while survivable, led to a large gap to be filled in several key areas including advanced manufacturing, R&D, and skills development. While workers transitioned, many would end up in lower-skilled or unrelated jobs to manufacturing.

Tier-II and Tier-III suppliers dried up, which from a national security standpoint is a devastating development that fundamentally meant starting from a weak point on future developments like Redback and K9. That also includes the loss of experienced, senior talent whom by the time Hanwha came around were either moved on or gone from thr labour pool entirely.

That isn't just skills losed on the manufacturing side, that's senior talent one needs as a backbone for supporting and training the next generation. The loss of such talent, while we can't directly confirm, is likely part of the reason Hanwha in Australia has had some intial workforce struggles.

That is why we are so overtly concerned with maintaining the automotive sector, and why when both potential partners are automotive giants, we put some pressure to see some love.

Yet it raises another, glaring issue with CPSP. What exactly is it that we hope to achieve from the economic side? What investments are seen as more important than others? Is this seen as a win? Or is it recognized as a consolation prize? Does anyone in the federal government really care so long as money flows in and development happens?

As of now, the answer is whatever the feds feel like. They, at the end of the day, decide what is valuable here. Yet from the outside perspective, one has to ask at what point do these sort of investments stop making a difference? And at what point do obviously forced-in promises actually become damaging to the conversation?

Because truly, I do think that is possible, where an investment can carry a negative connotation. That raises the question of whether it would be better to just do nothing in certain areas at all, lest you risk coming off as pedantic and trying to force favour. There is also the debate if efforts to complete an imaginary, personal checklist set out by a few ministers is worth it over building a more comprehensive, tight-knit package with actual backing and purpose.

I think back to German efforts in Churchill, which were immediately countered by the Koreans rushing to NeeStaNan to have a tit-for-tat counter with Port Nelson. That's surprisingly common. Each side has gotten to a weird stage of trying to counter each other, chasing the personal desires of a few in government, and you gotta wonder if it really means anything.

I imagine there's at least one person looking at some of these and rolling their eyes. I know there is. To that, one has to remember that CPSP is a politics game. There is a bit of showmanship and courting that both sides are expected to do to win over key individuals on the file.

So perhaps it is me who is wrong, and many are willing to sit and clap at everything thrown. I am not, and I know a few who aren't. Eventually, it becomes a bit much, a bit of a sigh, and a questioning of what the purpose is. Is it sustainable? Economically viable? Are some promises even realistic?

Both sides are guilty of it. I am not trying to put blame on Hyundai. However, overloading a package with song-and-dance promises that clearly aren't based off your own desire, but out of pressure for investment in key industries, and a promise that likely isn't gonna get more than a raspberry out of many on top of that, feels like chasing a brass ring while ignoring the finish line.

Again, I can't say what federal officials are thinking. I don't know. I am not important enough to hear the thoughts of ministers. I do, however, have my own thoughts, and enough of the people under to start to question what the flashpoint is, where the line gets crossed to the point of indifference and then negativity.

Something to think about, at least, when you look at every promise, every given number, and plan over the final few weeks.