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October 31, 2002-15
Copyright © 2002 Earth Policy Institute
FUEL CELL-POWERED CARS HITTING THE ROAD AHEAD OF SCHEDULE
Bernie
Fischlowitz-Roberts
On April 2, 2001, Ballard Power Systems, the world leader in fuel
cell production, announced a sale of $16 million of fuel cell modules
and support services to the Honda Motor Company. In September and
December, 2001, Ballard concluded two agreements with Ford Motor
Company to provide $66 million of the same fuel cells and services.
The fuel cell economy is developing much
faster than expected, as the competition among companies intensifies.
This momentum in developing clean sources of electricity for vehicles,
as well as homes and businesses, holds the promise of a cleaner
energy future, bringing us one step closer to an eco-economy.
Fuel cells use hydrogen to produce electricity
and emit only water and heat. If used to power a vehicle, the fuel
cells generate electricity to run the motor. Buildings powered by
fuel cells use both the electricity and the heat they generate,
increasing the fuel cells' efficiency. If the hydrogen fuel is derived
from the electrolysis of water, using electricity obtained from
wind turbines, solar cells, hydropower turbines, or geothermal generators,
it is completely emission-free. Some fuel cells rely on hydrogen
extracted from natural gas or gasoline; while not emission-free,
this is still much cleaner than fossil fuel combustion. Fuel cell
vehicles that derive hydrogen from fossil fuels are typically twice
as fuel-efficient as vehicles with internal combustion engines.
Major automakers are on the verge of introducing
fuel cell vehicles (FCVs)-in some cases much sooner than anyone
anticipated. DaimlerChrysler announced that early next year, 60
Mercedes-Benz A-Class FCVs will be unveiled as part of limited customer
fleets in Japan, Singapore, the United States, and Europe. Honda
will sell the first of its FCX model to the city of Los Angeles
by the end of 2002, and they plan to distribute 30 cars in California
and Japan over the next two to three years. The Honda seats four
and has a range of 220 miles (354 kilometers). Toyota also plans
to introduce 20 fuel cell hybrid SUVs by the end of the year, which
will be offered to customers with access to hydrogen-supply infrastructure
and after-sales service. Ford is sending five Focus FCVs to California
for evaluation this year, and plans a small number of fleet vehicles
in 2004. Even though it may take a decade for widespread commercialization
of FCVs, the availability of small fleets of these vehicles ahead
of schedule is a promising development.
Fuel cell-powered buses will soon be used
in a number of cities. Since buses are often refueled at a central
location, just like other fleet vehicles, they can be introduced
before hydrogen stations become widely available. Following successful
fuel cell bus trials in Chicago and Vancouver during 1999-2001,
DaimlerChrysler has been working with Ballard Power Systems, a leading
fuel cell producer, to provide 10 European cities with 30 fuel cell
buses in the next few years. This European Fuel Cell Bus Project
represents the next step in the transition away from internal combustion-powered
transportation.
Hydrogen stations are opening to serve the
needs of hydrogen vehicles, primarily at research facilities. Honda
opened a hydrogen station in Torrance, California, that produces
hydrogen using solar-powered water electrolysis. SunLine Transit
operates a station in Thousand Palms, California, that offers hydrogen
along with numerous other fuels. Munich has a hydrogen station on
the grounds of its airport that is used to fuel a fleet of 15 BMW
sedans with internal combustion engines that run on hydrogen. Tokyo
has three hydrogen stations built with government funding, and a
natural gas company in Japan is currently building a fourth.
Iceland plans to be the first hydrogen-powered
economy. Next year, DaimlerChrysler will begin to convert Reykjavik's
80 buses to fuel cell engines. Shell is constructing a hydrogen
station that uses inexpensive hydropower to electrolyze water to
supply the buses. After the buses are converted, Iceland's passenger
cars will be next, and then the nation's fishing fleet.
One obstacle to commercialization of fuel
cell vehicles is the lack of a fueling infrastructure. In a classic
chicken-and-egg situation, car companies are wary of producing too
many fuel cell vehicles without a network of hydrogen stations,
while companies involved in hydrogen fuel are wary of building the
requisite infrastructure in the absence of a sizable fuel cell vehicle
market. Some automakers estimate that 30 percent of filling stations
in the United States would need to offer hydrogen fuel in order
for a viable hydrogen-based transport sector to emerge.
To overcome high costs, which is a second
obstacle to mass production and commercialization of FCVs, the stationary
fuel cell market may play a key role. Experts at the Rocky Mountain
Institute suggest that buildings may be the initial market to increase
fuel cell production and cut costs, eventually making fuel cells
cost-competitive for vehicles. They make clear, however, that buildings
and vehicles are both such large markets that when fuel cell production
in either sector starts to take off, the other will follow. Once
buildings get much of their power from fuel cells, spare off-peak
hydrogen can be used to run vehicles; this eliminates the need for
a fully developed network of hydrogen stations to precede FCV commercialization.
Businesses that need a reliable electricity
supply are turning to fuel cells to power their buildings. Verizon
announced in April 2002 that it would use fuel cells to provide
electrical power at a telephone call routing center on Long Island,
New York. The U.S. Postal Service's mail processing center in Anchorage,
Alaska, also uses fuel cells to get power unaffected by outages
on the grid. The First National Bank of Omaha, a credit card processing
company, turned to fuel cells to provide the consistent power supply
it requires. It then uses the heat from the fuel cells for space
heating.
To encourage private investment in building
a hydrogen infrastructure conducive to FCVs, tax credits for hydrogen
production and fuel cell production-modeled after the wind production
tax credit in the United States-could play a constructive role.
Tax credits for fuel cell production could stimulate economies of
scale to drive down costs. Additional incentives for so-called early
adopters could motivate further investment, as could government
purchases of FCV fleets. As the single largest user of energy in
the world, the U.S. government can play a significant role in stimulating
market demand for fuel cells.
The movement to bring hydrogen fuel cells
to the forefront of the global energy market will require collaboration
across industries. One example of such an effort is the California
Fuel Cell Partnership. Formed in 1999, this consists of auto manufacturers,
energy providers, fuel cell companies, hydrogen suppliers, developers
of hydrogen fueling stations, transit companies, government agencies,
and the environmental community. Its goal is to increase public
awareness of fuel cells and prepare the market for commercialization
of FCV technology.
The European Commission recently launched
a high-level group of car and energy companies to ensure that European
companies with interests in hydrogen and fuel cell development do
not fall behind their Japanese and U.S. counterparts. The group,
which includes Royal Dutch/Shell, DaimlerChrysler, and Renault along
with 15 other companies, clearly recognizes the competitive advantage
of early entrance into the fast-emerging hydrogen economy.
Copyright
© 2002 Earth Policy Institute
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FOR ADDITIONAL INFORMATION
From Earth Policy Institute
Lester R. Brown, Eco-Economy:
Building an Economy for the Earth (New York: W.W. Norton
& Company, 2001).
Lester R. Brown, Janet Larsen, and Bernie Fischlowitz-Roberts,
The
Earth Policy Reader (New York: W.W. Norton & Company, 2002).
From Other Sources
U.S. Department of Energy, A National Vision
of America's Transition to a Hydrogen Economy-to 2030 and Beyond
(Washington, DC: February 2002).
Robert Rose, Fuel
Cells and Hydrogen: The Path Forward, (Washington, DC: September
2002).
Amory B. Lovins and Brett D. Williams, A Strategy
for the Hydrogen Transition, paper presented to National Hydrogen
Association, 10th Annual U.S. Hydrogen Meeting, (Vienna, VA: April
1999).
Lawrence D. Burns, J. Byron McCormick, & Christopher
E. Borroni-Bird, "Vehicle of Change," Scientific American,
October 2002, pp. 64-73.
LINKS
Hydrogen and Fuel Cell Letter http:/www.hfcletter.com
California Fuel Cell Partnership http:/www.fuelcellpartnership.org
US Fuel Cell Council
http:/www.usfcc.com
Fuel Cells 2000: Online Fuel Cell Information Center
http:/www.fuelcells.org
National Hydrogen Association http:/www.hydrogenus.org
Ballard Power Systems
http:/www.ballard.com
Stuart Energy
http:/www.stuartenergy.com
Japan for Sustainability
http:/www.japanfs.org (search
for "fuel cell" for related articles)
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