Fuel cells are poised for their first commercial home installations. By early next year, Tokyo Gas will install the technology outside 50 Japanese homes, with plans to install 900 more units by 2007. The units will extract hydrogen from natural gas and use it to create supplemental electricity for the homes. Waste heat from the fuel cells-rather than electricity-will heat water for household use. All told, using fuel cells to reduce the homes’ reliance on electricity from gas-fired power plants should cut their fossil fuel consumption by about one-quarter.

The households will be able to replace their hot-water heaters with the new fuel cell system “and also get one kilowatt of electricity for free”-enough to satisfy all the home’s electricity needs during the periods of lowest demand, says Dennis Campbell, president and CEO of Ballard Power Systems in Vancouver, British Columbia, whose fuel cells are part of the Tokyo Gas system. The program will be followed by early 2006 by a similar effort from another Japanese utility, Osaka Gas.

The fuel cells are a particularly attractive option in Japan, where electricity prices are nearly double those in the United States. The fuel cell units will be pricey, though, costing consumers $3,000 to $5,000 apiece. And that’s half the true cost; the Japanese government is paying the rest as part of an effort to reduce fuel consumption and carbon dioxide emissions. But because buying natural gas for the fuel cells is far cheaper than purchasing electricity, the fuel cells will pay for themselves within five to seven years, according to Campbell.

It will still be several years before fuel cell generators come down in price and achieve the reliability expected of home appliances, says Jon Slowe, research manager with Boulder, CO-based Platts Research and Consulting. Still, taking the first step of getting fuel cells into some homes “will make it easier for fuel cell technology to move forward,” says Atakan Ozbek, director of energy research with ABI Research in Oyster Bay, NY. Ozbek predicts domestic fuel cells will take hold in Europe, and then the United States, within three to four years.

A Home for Fuel Cells Company Technology/Status Ballard Power Systems (Vancouver, British Columbia),
Tokyo Gas (Tokyo, Japan),
Osaka Gas (Osaka, Japan) Fuel cells that generate electricity and heat for houses will be sold to gas customers in Tokyo and Osaka, Japan, starting in early 2005 Plug Power (Latham, NY),
Honda R&D (Wako, Japan) Prototype of home fuel cell unit that also generates hydrogen for fuel cell cars completed this year Sulzer Hexis (Winterthur, Switzerland) One hundred home fuel cells being tested in Germany, Austria, and Switzerland; commercial release planned for late 2005