durability: development goals are for 40,000 to 50,000 hours between major overhauls for stationary systems and 4,000 to 5,000 hours for automotive systems; the development of efficient and low-cost fuel reformers (see Chapter 8); and the development of vehicular hydrogen storage systems that are inexpensive, lightweight, compact, safe, and quick to refuel (see Chapter 4).


Finding 3-1. The federal government has been active in fuel cell research for roughly 40 years. Proton exchange membrane fuel cells (PEMFCs) applied to hydrogen vehicle systems are a relatively recent development (as of the late 1980s). The Department of Energy has spent more than $1.2 billion since 1978, and there has been considerable private sector investment for all fuel cell types. The DOE has spent $334 million since the 1980s on PEMFCs for transportation applications, most of it at national laboratories. Automakers and suppliers greatly expanded their PEMFC development efforts beginning in the later 1990s. In spite of the large federal and private sector investment, fuel cell prototype costs for light-duty vehicles are still a factor of 10 to 20 times too expensive and these fuel cells are short of required durability. Accordingly, the challenges of developing PEMFCs for automotive applications are large. Furthermore, the DOE’s near-term milestones for fuel cell vehicles appear unrealistically aggressive on the basis of the current state of knowledge with respect to fuel cell durability, storage systems, and overall costs. The choice of unrealistic targets can lead to programs that emphasize spending on extensions and expensive demonstrations of current technologies in lieu of breakthroughs that will probably be required if a fuel-cell-based hydrogen economy is to be realized. Industry is expanding its development; thus, the DOE should focus on fundamental research.

Recommendation 3-1a. Given that large improvements are still needed in fuel cell technology and given that industry is investing considerable funding in technology development, increased government funding on research and development should be dedicated to the research on breakthroughs in on-board storage systems, in fuel cell costs, and in materials for durability in order to attack known inhibitors to the high-volume production of fuel cell vehicles.

Recommendation 3-1b. Since a hydrogen transportation economy will probably not emerge without the development of reasonably priced, energy-efficient fuel cells, the transportation portion of the Department of Energy’s research, development, and demonstration program should emphasize fuel cells and their associated storage systems at the expense of “transition technologies” such as on-board reformers and hydrogen internal combustion engines. Since transition technologies mainly involve “development,” funding for these programs should be provided by industry. Of course, some component breakthrough technologies for reformation might be justified in supply-side programs, and the results might be applicable to on-board reformation.

Finding 3-2. Various fuel cell technologies are attractive for stationary applications. In fact, the major stationary fuel cell research, development, and demonstration programs—in particular, the solid oxide fuel cell and the molten carbonate fuel cell (neither of which requires hydrogen fuel)—are not part of the Department of Energy’s integrated direct-hydrogen program. Some private companies have committed to introducing proton exchange membrane stationary fuel cells without DOE funds, and these fuel cells appear to have applicability in a number of niche markets.

Recommendation 3-2. The Department of Energy should discontinue the proton exchange membrane (PEM) applied research and development program for stationary systems. The $7.5 million annual budget (FY 2003 and FY 2004 request) for that program could be applied to PEM fundamental and basic issues (exploratory research) for all applications.

Finding 3-3. During the past 20 years, a number of approaches have been used to encourage the application of alternative fuels and technologies in transportation and stationary systems. Most of these have failed because of the lack of real marketplace pull, shifts in government policies, and the relative disinterest of industry. The role of marketplace pull is especially important, as has been exhibited by the progress in batteries over the past decade to satisfy high-volume consumer electronics demand—for example, the rapid transition from nickel cadmium through nickel metal hydride to today’s lithium-ion battery packs.

Recommendation 3-3. As the Department of Energy develops its strategy for the hydrogen economy with respect to the role of public research, development, and demonstration policies, it should sponsor an independent study of lessons learned with respect to the lack of success and widespread market acceptance of previous alternative fuel technologies, as well as other technologies developed for transportation and stationary power systems. The purposes of this study would be as follows: (1) to assess the role of government policy and its stability as it affects industry and consumer behavior, (2) to affect strategies related to the introduction of hydrogen in the end-use sectors, and (3) to avoid repeating the mistakes of prior-technology-introduction programs, such as those for electric and natural gas vehicles and for phosphoric acid fuel cells for distributed generation. In addition, strengths and weaknesses of the Partnership for a New Generation of Vehicles Program and hybrid electric vehicle development should be analyzed, as the FreedomCar Program is structured for the development of fuel cell vehicles.

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