For various reasons, the establishment of a viable hydrogen systems analysis program will not be an easy task. For one thing, the DOE has had relatively little experience with effective systems analysis in the past. Additionally, such analysis programs are expensive. Also, the results of sound systems analysis can upset vested interests.

Finding 9-1. The pathway to achieving a hydrogen economy will be neither simple nor straightforward. Indeed, significant risks lie between the present vision for a hydrogen economy and the actual achievement of that vision. The chief technical challenges include these: safe, durable, and economic hydrogen storage; cost-effective, durable fuel cell technology; economic and publicly acceptable carbon capture and sequestration; breakthroughs in hydrogen distribution systems; and cost-effective, energy-efficient renewable and distributed hydrogen generation systems. These challenges can only be addressed by research and development, and there is no guarantee that such efforts will be successful. However, even more-challenging issues will arise from a larger set of economic and social concerns, especially those of enabling investment in hydrogen distribution and logistic systems and of public acceptance, which will likely be heavily influenced by hydrogen safety concerns. Thus, it is appropriate for the Department of Energy to advance hydrogen and fuel cell options at this time. In addition, given the important role of other, nonhydrogen energy technologies and strategies, including conservation, during the coming decades and given the possibility that some, such as battery storage, might more rapidly advance many of the goals set out for the hydrogen economy, the DOE’s hydrogen research programs must be measured and managed against progress in these nonhydrogen fields so that an appropriate balancing of overall energy policy can be achieved.

Recommendation 9-1. The Department of Energy should continue to develop its hydrogen initiative as a potential long-term contributor to improving U.S. energy security and environmental protection. The program plan should be reviewed and updated regularly to reflect progress, potential synergisms within the program, and interactions with other energy programs and partnerships (e.g., the California Fuel Cell Partnership). In order to achieve this objective, the committee recommends that the DOE develop and employ a systems analysis approach to understanding full costs, defining options, evaluating research results, and helping balance its hydrogen program for the short, medium, and long term. Such an approach should be implemented for all U.S. energy options, not only for hydrogen.

As part of its systems analysis, the DOE should map out and evaluate a transition plan consistent with developing the infrastructure and hydrogen resources necessary to support the committee’s hydrogen vehicle penetration scenario or another similar demand scenario. The DOE should estimate what levels of investment over time are required—and in which program and project areas—in order to achieve a significant reduction in carbon dioxide emissions from passenger vehicles by midcentury.

Finding 9-2. The effective management of the Department of Energy hydrogen program will be far more challenging than any activity previously undertaken on the civilian energy side of the DOE. That being the case, the use of management tools employed elsewhere in the government has the potential for a very high payoff in terms of the effective use of taxpayer funds and the development of the most efficient pathways to hydrogen systems success. In that regard, the adoption of systems integration techniques used elsewhere in the government has the potential for significant value. However, the DOE’s hydrogen exploratory research program must be managed in a very different manner—independent of the projects covered by systems integration management.

Recommendation 9-2. The Department of Energy should identify potentially useful management tools and capabilities developed elsewhere in the government for managing complex programs and should evaluate their potential for use in the hydrogen program. While such techniques are known to exist, it may well be that they will need to be modified to account for the overriding importance of economics in energy system development.

Finding 9-3. An independent, well-funded, professionally staffed and managed systems analysis function, separated by a “firewall” from technology development functions, is essential to the success of the Department of Energy’s hydrogen program.

Recommendation 9-3. An independent systems analysis group should be established by the Department of Energy to identify the impacts of various hydrogen technology pathways, to assess associated cost elements and drivers, to identify key cost and technological gaps, to evaluate the significance of actual research results, and to assist in the prioritization of research and development directions.


Safety-Related Issues

High market penetration of devices that use hydrogen to deliver energy services can expose the general public to unaccustomed hazards. These hazards pose three challenges that will become manifest from the earliest days of any transition to a hydrogen economy:

  1. The requirement to protect human life and property;

  2. The need to develop codes and standards for hydrogen devices, production technologies, and logistic systems that

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