Van fleets hold the key to successful development of fuel cell technology, according to PSA Peugeot Citroen. The manufacturer has singled out light commercial vehicle fleets to help bring fuel cell technology a step closer.

Jean-Martin Folz, chairman of PSA Peugeot Citroen, said: "In the future there is a legitimate place for electric vehicles on delivery fleets and the growth of e-commerce will see an increase in deliveries."

Addressing delegates at PSA's Alternative Energy conference in Paris, Mr Folz said: "We believe in the progressive development of fuel cell technology for cars. In the short term it will be used for fleet vehicles in urban areas. In the mid to long term fuel cell technology can be used for cars, but this rests on the possibility of it being financially viable."

Between 1997 and 2000, PSA Peugeot Citroen invested over FF4 billion (£400 million) in renewing its range of gasoline and diesel engines to reduce fuel consumption. The group's alternative fuel strategy will lead it to develop three alternative energy technologies including LPG, biofuels, and electric vehicles such as battery powered, hybrid and fuel cell.

Pascal Henault, vice-president, automotive, research and innovation with PSA Peugeot Citroen, said electric technology had a key part to play in optimising the performance of the combustion engine. He added that between 2005 and 2010, the first application of the technology would be in electric powered commercial vehicles equipped with small onboard hydrogen fuel cells used to back up the battery driver powertrain.