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Assessing GM’s Fuel Cell Strategy

The automaker plans to begin rolling out a test fleet of fuel-cell cars, but some experts say it’s a mistake.
October 6, 2006

Last month, GM announced plans to distribute 100 fuel-cell-powered vehicles to customers next fall, along with plans to develop home-based hydrogen refueling stations. It’s the automaker’s latest move in its stated goal to build the world’s largest fuel-cell vehicle fleet. The first 100 vehicles will be available for evaluation in California, New York, and Washington, DC.

But, from an environmental and technical standpoint, does it make sense?

Fuel-cell vehicles, which are being developed by other automakers as well, are powered by electricity generated from hydrogen. They emit only water vapor from their tailpipes, and the fuel cells are significantly more efficient than an internal-combustion engine in extracting energy from the fuel.

But GM’s focus on creating a fleet of hydrogen fuel-cell vehicles could be a costly mistake as a strategy for combating global climate change and for decreasing U.S. dependence on oil, many energy experts say. The problem, these critics argue, is that powering electric vehicles with hydrogen fuel cells is both inefficient and expensive.

Hydrogen fuel must be extracted from fossil fuels or water–both energy-consuming processes. Once produced, the gas must be compressed or liquefied for distribution, and this process and the distribution itself take yet more energy. By the time the hydrogen has been delivered to the fuel cell for conversion to electricity, then, a significant amount of energy has been lost to these processes.

“Along the way, you’ve thrown away nearly three-quarters of the electricity. No one in their right mind would do that–if your alternative is to just string a power line from zero-carbon electricity and charge a battery onboard a car,” says Joseph Romm, executive director of the Center for Energy and Climate Solutions, and formerly in charge of energy efficiency and renewable energy at the U.S. Department of Energy.

Romm says a more promising alternative to internal-combustion engines are plug-in hybrids, which combine an electric motor powered by batteries with a conventional gasoline- or diesel-powered engine, but rely on the electric motor far more than today’s hybrids. Plug-in hybrids, which are being developed by Toyota, with conversion kits for ordinary hybrids already available through several companies, would not eliminate the use of gas, but they would cut down on it significantly. In one type of plug-in hybrid, electricity from the grid can provide enough power for an average commute, at a fraction of the cost of gasoline.

Charging a battery in a plug-in hybrid would be around three to four times more energy efficient than going through the intermediate steps required to make hydrogen fuel from water, using a process called electrolysis, according to Ulf Bossel, organizer of the European Fuel Cell Forum.

But GM argues that such hybrid cars are only an interim solution, not a long-term alternative to the internal-combustion engine. To replace the internal-combustion engine, says Jon Bereisa, director of GM’s fuel-cell program, automakers will need to produce all-electric vehicles that feature “no compromises” with gasoline-powered vehicles, if enough people are going to buy them to make a difference. He says that battery packs for delivering the driving range people expect will be too big, complicated, and, most importantly, take too long to recharge to make them appealing. Fuel-cell vehicles, he says, “might not be the most efficient,” but they can be refilled in a matter of minutes, and consumers won’t have to give up cargo space.

Still, even advocates of fuel cells admit that the technology cannot yet compete with alternatives such as hybrids. “With hybrids, we can go on a smooth technology development path. We’ve already got hybrids that are in place,” says James Sweeney, professor of management science and engineering at Stanford. “We can now move to plug-in hybrids. They’re more costly right now, but you add maybe $5,000 to $10,000. You’re not adding more than $100,000 to it,” as would likely be the case with a fuel-cell vehicle, he says. “The bottom-line economics right now are so much more attractive than the hydrogen economics.”

Sweeney thinks that if GM starts ramping up from its initial 100 fuel-cell-vehicle fleet, it will be a “terrible strategy,” at least until fuel cells don’t depend heavily on expensive precious metals such as platinum as catalysts, as they do now, and better ways of storing hydrogen fuel onboard are found. “If you only have 100 of them, and they’re uneconomical, you can subsidize it. If you have a million of them, who’s going to subsidize it?” he asks.

Sweeney notes that, in any case, it’s likely that neither fuel-cell cars nor plug-in hybrids will mean a clean break from fossil fuels, since the cheapest hydrogen will come from reforming fossil fuels, and the electricity for increasing numbers of plug-in hybrids will likely be provided by cheap coal plants.

Others, such as former DOE official Romm, are even more critical of the fuel-cell option. He says money for research and development of fuel-cell vehicles and their related infrastructure is going to waste and the GM approach is “insane.” He adds: “Hydrogen is the last thing you would do, only if everything else has failed.”

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