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Summary background and scope of study for actions to reduce U.S. oil imports and CO2 emissions. But on the basis of recent studies, including the NRCâs 2004 In 2005, drawn by the potential for hydrogen-fueled report The Hydrogen Economy (NRC, 2004), the commit- vehicles to achieve large reductions in U.S. oil imports and tee concluded that it would not be feasible to have enough emissions of carbon dioxide (CO2)âthe main greenhouse hydrogen vehicles on the road by 2020 to significantly affect gas linked to global climate changeâCongress requested CO2 emissions and oil use, although hydrogen could have that the National Research Council (NRC) assess what a substantial impact in the longer run. Thus, the committee resources would be required for a transition in the U.S. light- extended the time period of its study to 2050 and estimated duty vehicle fleet to hydrogen fuel cell vehicles (HFCVs) the technical readiness and potential impacts of HFCVs at by 2020. Specifically, Section 1825 of the Energy Policy 2020, 2035, and 2050. Act of 2005 stated: âThe National Academy of Sciencesâ The emphasis throughout the study, as set forth in the National Research Council will appoint a committee to carry statement of task, is on the maximum practicable number of out a study of fuel cell technologies that provides a budget HFCVs, or, as used in this study, the maximum practicable roadmap (e.g., what investments in R&D, demonstrations, penetration rate (MPR) of HFCVs achievable in the 2008 to skilled people, [and] infrastructure will be required) for 2050 time frame. Rather than a prediction of the future, the the development of fuel cell technologies and the transition committee developed a scenario based on its estimate of the from petroleum to hydrogen in a significant percentage of maximum practicable penetration rate, assuming that techni- the vehicles sold by 2020.â cal goals are met, that consumers readily accept HFCVs, and In 2007, the NRC formed the Committee on Assessment that policy instruments are in place to drive the introduction of Resource Needs for Fuel Cell and Hydrogen Technolo- of hydrogen fuel and fuel cell vehicles through the market gies. The statement of task for this study requested that the transition period. committee: In keeping with its statement of task, the committee also considered whether other technologies might achieve signifi- â¢ Establish as a goal the maximum practicable number cantly greater reductions in oil imports and CO2 emissions of vehicles that can be fueled by hydrogen by 2020; than HFCVs over the next several decades. After considering â¢ Determine the funding, public and private, to reach that a range of alternative technologies and the budget constraints goal; of the study, the committee chose to quantitatively evalu- â¢ Determine the government actions required to achieve ate, using the MPR approach, one alternative fuel and one the goal; alternative vehicle option, namely, (1) fuels derived from â¢ Consider the role that hydrogenâs use in stationary biomass (in light of the increased emphasis on this option electric power applications will play in stimulating the tran- in the United States) and (2) evolutionary improvements sition to hydrogen-fueled hybrid electric vehicles; in internal combustion engines (ICEs) and hybrid electric â¢ Consider whether other technologies could achieve vehicles (HEVs) (in light of the potential of these technolo- significant CO2 and oil reductions by 2020; and gies to increase vehicle efficiency in the short term). These â¢ Establish a budget roadmap to achieve the goal. alternative fuel and vehicle technologies also will be needed through 2020 to meet the significantly higher fuel economy Early in its deliberations, the committee noted that the standards required by the Energy Independence and Security congressional focus on impact by 2020 implied an urgency Act (EISA) of 2007.
TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIESâA focus on hydrogen Two other alternative technologies that are likely to con- The committeeâs analysis indicated that over the next tribute to improved U.S. fuel economy are electric vehicles, two decades, a combination of improved conventional and including plug-in hybrid electric vehicles (PHEVs), and hybrid vehicle fuel economy, together with increased use of diesel engines in light-duty vehicles. However, these options biomass-derived fuels (known generically as biofuels)âand were not explicitly evaluated by the committee, both because with sufficient market conditions and policies in placeâ of resource limitations and because uncertainties in the future could deliver substantial reductions in U.S. oil use and CO2 costs and consumer acceptance of these technologies were emissions. While HFCVs are unlikely to deliver significant judged to be too great for the committee to have confidence benefits in this period, eventually they can do much better. in any assumed penetration rates. For all technologies, the Thus HFCVs are not direct competitors with other options study was restricted to light-duty vehicles (automobiles and that are able to deliver more immediate environmental and light trucks), which represent the bulk of the U.S. vehicle fuel use benefits. Instead, if employed with these options, market. collectively they can achieve dramatic, long-term reductions As a benchmark for evaluating the ability of HFCVs in oil use and CO2 emissionsâbenefits that could continue and other technologies to reduce oil imports and CO2 emis- to grow beyond the 2030-2050 time frame. Achieving sig- sions, the committee developed a reference case scenario nificant benefits of this kind, however, will require additional based on the high-price case of the Energy Information policy measures to promote the early introduction of fuel cell Administrationâs (EIAâs) Annual Energy Outlook 2008 (EIA, vehicles and to ensure that hydrogen is produced in ways that 2008). This scenario included a significant increase in fuel do not add to the CO2 burden. economy standards as required by the Energy Independence and Security Act of 2007. The committee used the EIA report CONCLUSION 1: A portfolio of technologies includ- to estimate factors such as the future number of vehicles of ing hydrogen fuel cell vehicles, improved efficiency of different types on the road, as well as reference case fuel conventional vehicles, hybrids, and use of biofuelsâin economies and gasoline prices. The committee recognizes, conjunction with required new policy driversâhas the of course, that the projections presented in this studyâlike potential to nearly eliminate gasoline use in light-duty any otherâcontain significant uncertainties and unknowns vehicles by the middle of this century, while reducing because of changes that are likely to occur over the next fleet greenhouse gas emissions to less than 20 percent of several decades. current levels. This portfolio approach provides a hedge against potential shortfalls in any one technological approach and improves the probability that the United SYNOPSIS OF STUDY RESULTS States can meet its energy and environmental goals. The substantial financial commitments and technical Other technologies also may hold promise as part of a progress made by the automotive industry, private entre- portfolio, but further study is required to assess their preneurs, and the U.S. Department of Energy (DOE) in potential impacts. See Chapter 9. hydrogen fuel cell and hydrogen production technologies suggest the potential for progress to the point that com- CONCLUSION 2: Sustained, substantial, and aggres- mercial HFCVs could be introduced in the United States sive energy security and environmental policy interven- in 2015-2020. However, these vehicles are unlikely to be tions will be needed to ensure marketplace success for cost-competitive until several years after 2020 even if the oil-saving and greenhouse-gas-reducing technologies, maximum practicable number is reached. It will thus require including hydrogen fuel cell vehicles. See Chapter 8. substantial government action (e.g., subsidies and enact- ment of regulations), plus continued support for research, Technology assessment development, and demonstration (RD&D), to move HFCVs into the market in sufficient numbers to reduce costs and To develop the maximum practicable number scenario make the technology self-supporting in the marketplace. and associated budget roadmap, the committee assessed the Nevertheless, the committeeâs analysis also showed that the technical progress and future challenges for (1)Â hydrogen long-term promise of HFCVs in reducing oil consumption fuel cell vehicles and (2)Â hydrogen production and delivery and CO2 emissions is significant, and potentially greater than systems. that of other nearer-term alternatives. Although it was not asked to make a formal analysis of the value of policies to Hydrogen Fuel Cell Vehicles support hydrogen, the committee believes that, in view of the potential risks posed by oil supply disruptions and increasing Concentrated efforts by private companies, together CO2 emissions from oil use, the magnitude of the potential with the U.S. FreedomCAR Fuel Partnership (FCFP) and benefits justifies sustained government support of hydrogen other government-supported programs around the world, vehicle development as part of a portfolio of options to have resulted in significant progress toward a commercially address these serious national problems. viable hydrogen fuel cell vehicle since the publication in
SUMMARY 2004 of The Hydrogen Economy (NRC, 2004). Fuel cell DOE targets for HFCVs may not be fully realized. See costs have been reduced significantly over the past 4-5 Chapter 3. years. Costs projected for high-volume (500,000 units per year) automotive fuel cell production are approximately Hydrogen Production Systems $100/kW for relatively proven technologies and $67/kW for newer laboratory-based technologies, compared to the To develop a budget roadmap for the maximum practi- DOE-FCFP commercialization goal for 2015 of $30/kW. cable number scenario, the committee also evaluated the sta- The cost of platinum is approximately 57Â percent of the tus of hydrogen production technologies. In the committeeâs fuel cell stack costs and represents the greatest challenge judgment, the three hydrogen production technologies that to further cost reductions. Fuel cell stack life has increased have the highest likelihood of commercial viability in the to approximately 2,000 hours compared to the DOE-FCFP 2015-2035 time frame are (1) distributed steam methane ref- 2015 goal of 5,000 hours. Recently, new failure modes have ormation (DSMR) using natural gas as a feedstock for on-site been identified, particularly platinum dissolution into the production at a refueling station; (2) centralized hydrogen carbon electrodes. However, focused research to amelio- production from coal gasification with carbon capture and rate these failure modes, together with recent advances in sequestration (CCS); and (3) centralized production from electrode and membrane technology, should further reduce biomass gasification. Carbon-free hydrogen produced using costs and increase stack life. Onboard hydrogen storage to advanced high-temperature nuclear reactors for electrolysis achieve a 300-mile driving range has been the most difficult or thermochemical splitting of water might also be possible technical challenge. Identification of solid storage materials in this time frame, but the timetable and costs for develop- to achieve the DOE-FCFP 2015 goals, including the cost ment and commercialization of advanced (Generation IV) goal of $2/kWh, is in the research stage. It is not clear at nuclear technology are difficult to estimate. Electrolysis this time whether a suitable material will be identified that using electricity from the grid may be useful in certain cir- can meet these goals and timing targets. However, in order cumstances but is likely to be more expensive than DSMR to achieve the desired driving range between refueling stops, in most cases. Hydrogen produced from renewable energy the industry is prepared to use more expensive high-pressure sources, such as electricity generated by solar and wind hydrogen storage tanks that consume more space and add energy, could be viable if these technologies become more to vehicle weight while research progresses toward a more extensively deployed and their costs decline significantly commercially viable hydrogen storage material. HFCV fuel (especially solar energy systems). Direct energy conversion economy is currently about 50-55 miles per gallon of gaso- systems using photoelectrochemical or photobiological line equivalent (mpgge) for a midsize vehicle with an 80 kW technologies also can be significant long-term contributors fuel cell. The DOE target of 60 percent efficiency for 2015 to a hydrogen economy if associated technical hurdles can corresponds to 80 mpgge for the typical vehicle considered be overcome. in this report. Based on its assessment of hydrogen supply options, In summary, paths forward have been identified for further the committee concluded that in a maximum practicable reducing hydrogen fuel cell costs while increasing durability scenario: and fuel economy. Based on its technical assessment, the committee concluded that under the maximum practicable â¢ DSMR technology can be commercially available in number of vehicles scenario, a significant market transition sufficient quantities to fuel HFCVs at the DOE-FCFP cost to HFCVs could start around 2015 if supported by strong goal of $3.00/kg hydrogen in 2015, when a transition to fuel government policies to drive early growth, even if DOE cell vehicles might begin. Because a kilogram of hydrogen technology targets are not fully realized. The analysis of has about the same energy as a gallon of gasoline but is used potential reductions in oil use and CO2 emissions, discussed twice as efficiently in a fuel cell, $3.00/kg is equivalent to below, is based on the committeeâs understanding of the cur- $1.50/gallon. DSMR is likely to be more economical than rent technical status of fuel cell vehicles and the potential for alternative on-site technologies (such as electrolysis) and improvements over the next several decades. will be sufficient to fuel HFCVs through about 2025. Even though DSMR generates CO2 that is not captured, the report CONCLUSION 3: Lower-cost, durable fuel cell systems The Hydrogen Economy (NRC, 2004) showed that well-to- for light-duty vehicles are likely to be increasingly avail- wheels CO2 from DSMR-HFCV could be less than half that able over the next 5-10 years, and, if supported by strong from conventional gasoline-powered vehicles. The quantity government policies, commercialization and growth of of natural gas used through 2025 (approximately a 2 percent HFCVs could get underway by 2015, even though all increase in projected demand, based on EIA data) should not be large enough to dramatically affect natural gas prices. Delivered hydrogen costs at the outset of the transition will One be high because of the underutilization of production equip- kilowatt (kW) is equal to 1.34 horsepower. A kilowatt-hour (kWh) is the work done by 1Â kW operating for an hour. ment with a small number of HFCVs on the road. However,
TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIESâA focus on hydrogen by 2016 the cost of hydrogen is projected to equal that of CONCLUSION 4: If appropriate policies are adopted gasoline on a dollars-per-mile-of-travel basis. The future to accelerate the introduction of hydrogen and HFCVs, price of natural gas is the largest determinant of the viability hydrogen from distributed technologies can be provided of this option. at reasonable cost to initiate the maximum practicable â¢ Hydrogen production via coal gasification plus car- case. If technical targets for central production tech- bon capture and storage (CCS), with pipeline delivery of nologies are met, lower-cost hydrogen should be avail- hydrogen to refueling stations, could be commercially viable able to fuel HFCVs in the latter part of the time frame and available by 2025. If coal is used, CCS is necessary to considered in this study. Additional policy measures are achieve low-carbon hydrogen production. Coal gasification required to achieve low-carbon hydrogen production in and associated carbon capture technologies are already order to significantly reduce CO2 emissions from central used commercially to produce hydrogen (albeit on a much coal-based plants. See Chapter 3. smaller scale than natural gas reforming), but they have not yet been integrated with carbon sequestration. Nor has deep maximum practicable deployment of fuel geological sequestration of CO2 yet been demonstrated in cell vehicles the United States at the scale envisioned for a commercial hydrogen plant. Thus, the greatest challenge to coal-based A key task of this study was to âestablish . . . the maxi- hydrogen production is demonstrating the capacity and long- mum practicable number of vehicles that can be fueled by term storage capabilities for geological sequestration of CO2 hydrogen by 2020.â Based on that number of vehicles, the in deep saline aquifers. However, as part of the DOE Carbon committee was then to assess the impact on oil use and Sequestration Program, there are several industrial-scale, reduction of CO2 emissions; determine the costs and budgets well-monitored demonstration projects currently planned to needed to implement a program of this magnitude; and out- address issues of commercial viability over the next several line government actions that might be necessary to achieve years, and three large-scale geological sequestration projects it. The committee concluded that a goal for the maximum (1Â million tons of CO2 per year each) have been operating practicable number of vehicles would depend strongly on a successfully in other parts of the world for the past 4-12 host of factors related to future rates of technical progress in years. both fuel cell vehicles and hydrogen production, as well as â¢ Hydrogen from biomass gasification technology also future policy actions and consumer preferences. Given the is advancing and could be competitive by the mid to late many uncertainties, the committee developed three scenarios 2020s for centralized production with potentially low car- to reflect a range of possible HFCV penetration rates, to help bon impacts. Several scale-up projects are now under way. guide its judgment in this task: Carbon dioxide from biomass gasification also potentially can be captured and stored to yield ânegative emissionsâ of 1. Hydrogen Success (Case 1). This scenario assumes that CO2. While this hydrogen technology currently is not as well hydrogen and fuel cell developments meet slightly reduced developed as the two outlined above, the committee included performance and cost goals compared with those established it as a renewable hydrogen source. Recent advances indicate by DOE and the FreedomCar Fuel Partnership Program (as that the cost could approach $3.00/kg hydrogen with contin- explained in Chapter 3). This rapid-growth case corresponds ued technology progress. to a scenario recently developed by DOE to 2025 (Gronich, 2007), and extended by the committee to 2050. By 2050, 80 The main challenges to deploying these technologies are percent of new vehicles sold are assumed to be HFCVs (see (1) developing the technical capacity and regulatory frame- Figure 6.2 in Chapter 6). This is consistent with other recent work to permit and safely sequester CO2; (2) developing the modeling studies (Greene et al., 2007). technical, economic, and environmental knowledge needed 2. Accelerated Success (Case 1a). This variant assumes to support large-volume biomass production and transporta- a far more aggressive program that doubles the rate of intro- tion to central gasification facilities; and (3) establishing duction of HFCVs compared with Case 1, while meeting the public confidence in procedures for efficient permitting same performance and cost goals. Very aggressive national and installation of hydrogen production, distribution, and policy measures would be needed to drive this accelerated refueling systems. Safety issues, both real and perceived, caseâfor example, much more stringent CAFE standards in along with the creation of appropriate codes and standards, response to severe curtailments in oil supplies, or stringent are significant barriers to the introduction of HFCVs and limits on CO2 emissions in response to major new concerns the development of a hydrogen refueling infrastructure and about climate change. pose a significant risk to achieving the maximum practicable 3. Partial Success (Case 1b). The third case assumes penetration rate for hydrogen vehicles. Under the maximum shortfalls and delays in reaching the performance and cost percentage practicable scenario, the committee assumes that goals of Case 1, with penetration rates remaining at historical these hurdles will be overcome. rates for hybrids, supported by government subsidies.
SUMMARY Details of all scenario assumptions are elaborated in Chap- and 60 percent HCFVs in the U.S. fleet in these 3Â years. The ter 6 of this report. The committee used these scenarios to number of HFCVs grows rapidly after the market transition establish its estimate of the maximum practicable number of period, during which HFCVs are assumed to be supported vehicles. Analyses were conducted using a model developed by government subsidies and growing consumer acceptance. by committee members and based on other recent modeling In the Hydrogen Success scenario, HFCVs compete only studies and analyses (Chapter 6 provides all details). Results with improving conventional gasoline-powered vehicles of the analysis include the timing and magnitude of costs for and become cost-competitive by 2023, as discussed below HFCVs and associated infrastructure deployment, as well as in this summary. the resulting impacts on oil use and CO2 emissions relative to a base case scenario also defined by the committee. CONCLUSION 5: In the judgment of the committee, the In the committeeâs view, the Hydrogen Success case maximum practicable number of HFCVs that could be on (Case 1) best represents the maximum practicable number the road by 2020 is around 2 million. Subsequently, this of vehicles that could be fueled by hydrogen by 2020. The number could grow rapidly to as many as 60 million by Accelerated Success case (Case 1a), while achieving greater 2035 and more than 200 million by midcentury, but such reductions in oil consumption and CO2 emissions, had sub- rapid and widespread deployment will require continued stantially higher costs and greater technical risks. The Partial technical success, cost reductions from volume produc- Success case (Case 1b), which was more pessimistic about tion, and government policies to sustain the introduction achievable rates of technical progress, was higher in total of HFCVs into the market during the transition period cost than Case 1 because it took longer to achieve significant needed for technical progress. See Chapter 6. HFCV penetration and commercial viability, and Case 1b did not have a significant impact on oil and CO2 reductions over Impact of Fuel Cell Vehicle Deployment on Reductions in the next few decades. Oil Use and CO2 Emissions Achieving the Hydrogen Success case, however, would be challengingârequiring significant continued technical Another objective of this study was to assess the potential progress, consumer acceptance, and policies to achieve mar- of HFCVs to achieve significant reductions in oil imports ket penetration of HFCVs during the early transition period. and CO2 emissions. Estimating such impacts is difficult Thus, it is by no means a âsure thing.â because of the complexities and unknowns inherent in any For these reasons, it should be understood throughout this analysis of future transportation systems and fuel options. report that the maximum practicable number of vehicles esti- For example, in recent years, energy prices and equipment mated by the committee in response to the statement of task costs have escalated dramatically; how these will vary in does not represent the committeeâs view of the âprobableâ the future is unknown. The committee used its scenarios or âmost likelyâ number of HFCVs on the road by 2020 and to inform its judgments about the potential magnitude and beyond. Rather, the estimate of maximum practicable num- timing of reduced oil use and CO2 emissions associated with ber reflects a judgment about the ability to achieve the perfor- adoption of HFCVs. mance and cost goals required for market competitiveness, Figure S.2 shows results for the Hydrogen Success case grounded in historically observed rates of market penetration relative to the reference case without fuel cell vehicles. As for other new vehicle concepts and technologies, which have noted before, the reference case is based on an 2008 EIA not faced the difficulties associated with establishing a major high-oil-price scenario extended to 2050 by the committee. new fuel infrastructure. Although more aggressive scenarios Gasoline useâtaken as a measure of oil consumption and can be envisioned under certain circumstances, in general, importsâis reduced by only about 1Â percent by 2020; how- the Hydrogen Success case should be viewed as an optimistic ever, by 2035 the reduction in gasoline use grows to about estimate of what might be possibleânot a forecast of what 24 percent and by 2050 to nearly 70 percent. Similar trends is likely or probable. are shown in Figure S.2 for potential reductions in well-to- Figure S.1 shows the number of hydrogen fuel cell vehi- wheels CO2-equivalent emissions that account for all green- cles in the U.S. fleet and the percentage of new vehicles sold house gas emissions in the fuel supply chain (see Chapter over time for the Hydrogen Success case. Trends for HFCVs 6). In the Hydrogen Success case, net annual greenhouse gas are compared with those for conventional gasoline-powered emissions are reduced by less than 1Â percent in 2020, but vehicles based on a high-oil-price reference case scenario subsequent reductions are much greater (i.e., a 20 percent developed by the EIA and extended to 2050 by the commit- reduction in 2035 and a reduction of more than 60 percent tee. After starting at a few thousand HFCVs per year in 2012, in 2050 compared to the reference case). These numerical the maximum practicable number of HFCVs on the road estimates, especially for the longer term, are highly uncer- increases to almost 2 million in 2020, 60 million in 2035, tain and sensitive to assumptions about the reference case as and more than 200 million in 2050 for the Hydrogen Success well as the Hydrogen Success scenario. Unlike savings in oil case. As a percentage of all light-duty vehicles in service, use, however, net reductions in CO2 emissions do not auto- this corresponds to approximately 0.7 percent, 18 percent, matically accrue from the use of hydrogen-fueled vehicles.
TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIESâA focus on hydrogen 400 1.00 0.90 350 Case 1 (H 2 Success): gasoline 0.80 300 0.70 Vehicles (millions) Case 1 (H 2 250 Success): HFCV 0.60 Million gallons per year Fraction TOTAL Case 1 (H 2 Success): 200 0.50 gasoline 150 0.40 Case 1 (H 2 Success): 200,000 HFCV 0.30 100 0.20 150,000 50 0.10 Case 1 (H2 Success) 0 100,000 0 Reference 2000 2010 2020 2030 2040 2050 05 30 45 35 40 50 20 25 10 15 20 20 20 20 20 20 20 20 20 20 50,000 Year Year 0 FIGURE S.1â (Left) Hydrogen fuel cell vehicles in the U.S. light-duty fleet and (right) fraction of newFigureSum-1b.eps sold each year for FigureSum-1a.eps hydrogen vehicles 2000 2010 2020 2030 2040 2050 the Hydrogen Success case. This case assumes HFCVs compete only with gradually improving conventional gasoline-powered vehicles, and represents the committeeâs best estimate of the maximum practicable number of HFCVs deployableYear by 2020. 200,000 1800 Million gallons per year Million tonnes CO2 eq/yr 1600 150,000 1400 Case 1 (H2 Success) 1200 Case 1 (H2 100,000 Reference 1000 Success) 50,000 800 Reference 600 0 400 2000 2010 2020 2030 2040 2050 200 Year 0 2000 2010 2020 2030 2040 2050 Year FIGURE S.2â (Left) Annual gasoline consumption and (right) annual well-to-wheels greenhouse gas emissions for the Hydrogen Success 1800 case relative to a reference case with no hydrogen vehicles. Case 1 assumes that HFCVs compete only with gradually improving conventional FigureSum-2.eps Million tonnes CO2 eq/yr 1600 gasoline-powered vehicles. 1400 1200 Case 1 (H2 1000 Success) 800 Reference Rather, the Hydrogen Success scenario assumes that policy Timetable for Market Transition 600 measures are enacted prior to 2020 to incentivize or require 400 The potential benefits of reduced oil consumption and CO2 the control of CO2 emissions from the central stations used 200 emissions described above assume that HFCVs are deployed to produce hydrogen and that production from such plants 0 in increasing numbers according to the committeeâs Hydro- begins around 2025, with hydrogen delivered by pipeline 2000 2010 2020 2030 2040 2050 gen Success scenario. Since HFCVs initially are far more to refueling stations. Prior to that time, the production of Year expensive than conventional vehicles, the financial subsidy hydrogen from distributed natural gas reformers results in required to deploy them (and thus achieve future benefits) CO2 emissions, although at half the level of todayâs gasoline depends strongly on how long it takes HFCVs to compete vehicles on a well-to-wheels basis. FigureSum-2.eps economically in the marketplace with conventional gasoline vehicles. To estimate that transition period, the committee CONCLUSION 6: While it will take several decades for first estimated the total annual expenditures needed to pur- HFCVs to have major impact, under the maximum prac- chase and operate increasing numbers of HFCVs as shown ticable scenario fuel cell vehicles would lead to significant in Figure S.1. The unit cost of fuel cell vehicles was assumed reductions in oil consumption and also significant reduc- to decline along a learning curve with increasing production. tions in CO2 emissions if national policies are enacted to Hydrogen supply costs also declined with increasing produc- restrict CO2 emissions from central hydrogen production tion. These costs included the cost of energy feedstocks and plants. See Chapter 6. other operating costs, plus the capital cost of infrastructure
SUMMARY for refueling stations and hydrogen production facilities in its statement of task, the committee estimated a budget (including pipelines from central production plants in later roadmap of total annual costs to government and industry for years). Infrastructure cost estimates assumed the initial (1)Â conducting the research, development, and demonstration introduction of HFCVs in selected large cities and then in required for the transition to hydrogen and (2)Â deploying the other locations over time, according to scenarios developed maximum practicable number of fuel cell vehicles required by DOE (see Chapter 6). for the transition. The estimated costs for these activities are The committee then compared the year-by-year costs of summarized below. purchasing and fueling the number of HFCVs dictated by the Hydrogen Success scenario to the annual cost of purchasing Research, Development, and Demonstration Costs for the and fueling the same-size fleet of gasoline-powered vehicles. Transition This analysis assumed that consumers would value fuel on a cost-per-mile-traveled basis rather than cost-per-gallon- Because most future spending plans for RD&D are equivalent. When the sum of vehicle costs plus fuel costs proprietary and there is very little information on which to for the HFCVs became less than that for gasoline vehicles, base such estimates, those provided here are rough at best. the hydrogen vehicles were projected to be economically The committeeâs estimates for government spending were competitive on a life-cycle basis. That crossover was taken based on budgets for DOE, the main government agency as the end of the transition period. For the Hydrogen Success supporting RD&D on hydrogen. The DOE 2007 (budgeted) scenario, that year was 2023. By that time a total of about R&D funding and 2008 (requested) RD&D funding for the 5.5 million fuel cell vehicles are produced, according to this hydrogen program are each approximately $300 millionâa scenario. level the committee judged to be adequate. Estimates of The breakeven year for competitiveness is sensitive to future budgets assumed that funding for individual programs various assumptions, including HFCV costs and the costs was discontinued once a program was completed (such as the of hydrogen and gasoline over time. However, the results current program for distributed natural gas reforming), and described above are not significantly affected by recent that funds were added for projects that appeared appropriate changes in fuel economy standards for new vehicles. for increases (such as biomass gasification). Funding for Chapter 6 presents further details of the transition period some areas was held constant (in constant dollars) when it analysis. was judged that considerable work was still needed (such as for fuel cells). These rough estimates of annual government CONCLUSION 7: The unit costs of fuel cell vehicles and RD&D funding were projected to 2023, the breakeven year hydrogen in the Hydrogen Success scenarioâthe maxi- for HFCVs in the Hydrogen Success case (see Chapter 7). mum practicable caseâdecline rapidly with increasing The total RD&D funding requirement for 2008-2023 was vehicle production, and by 2023 the cost premium for estimated to be roughly $5 billion in constant 2005 dollars. HFCVs relative to conventional gasoline vehicles is pro- This number could be adjusted up or down, depending on jected to be fully offset by the savings in fuel cost over the the need for new programs and demonstrations. life of the vehicle relative to a reference case based on the For the U.S. private sector, a current RD&D funding EIA high-oil-price scenario. At that point, according to level of about $700 million per year was estimated based on the committeeâs analysis, HFCVs become economically a study commissioned in 2005 by a collaboration of several competitive in the marketplace. See Chapter 6. world fuel cell councils, adjusted for the United States (as discussed in Chapter 7) and supplemented by additional public information from small private U.S. companies. Much A Budget Roadmap for the Market Transition of the estimated spending needed in 2008 to 2012 would Producing and deploying the number of HFCVs shown be for demonstration vehicles prior to commercial-scale in Figure S.1 will not happen by itselfâsignificant govern- manufacturing. Subsequently, private RD&D in conjunction ment support will be needed to achieve this result. Even with government programs would likely address remain- with such support there is no guarantee that the technical ing technical issues and opportunities for improvements to and economic performance improvements assumed in the vehicle and hydrogen production technologies. Thus, total Hydrogen Success case can be achieved in the given time U.S. private spending on RD&D for the hydrogen transition frame. There are risks as well as potential rewards with these from 2008 to 2023 was estimated to continue at an average new technologies. Nonetheless, if the substantial potential of $700 million per year, totaling roughly $11 billion in benefits of hydrogen vehicles suggested in Figure S.2 are constant 2005 dollars. to be realized, substantial financial investments also will be Although no RD&D funding estimates were projected required from both industry and government. As requested beyond 2023, the committee fully anticipates the need for continued RD&D funding by both government and the pri- The vate sector in the Hydrogen Success scenario. In particular, CAFE standards enacted in December 2007 phase in a 35 mpg requirement for new cars from 2011 to 2020. increased emphasis on hydrogen production with low or
10 TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIESâA focus on hydrogen zero carbon emissionsâsuch as from renewable energy and deliver hydrogen account for approximately half of sourcesâis expected to be an area of growing importance, the annual hydrogen costs, with the remaining half being both during and after a transition to HFCVs. operating costs, mainly the cost of natural gas for hydrogen production. CONCLUSION 8: The committee estimates that total Total annual costs grow rapidly as increasing numbers government-industry spending on RD&D needed to of vehicles are deployed. The cumulative cost of fuel cell facilitate the transition to HFCVs is roughly $16 billion vehicles purchased during the transition period 2012-2023 over the 16-year period from 2008 through 2023, of which is about $170 billion, or an average of $30,000 per vehicle about 30 percent (roughly $5 billion) would come from (see Table S.1). Of this, $40 billion (an average of $7,000 per U.S. government sources. Government and private spend- vehicle) represents the additional investment for HFCVs over ing beyond 2023 also will likely be required to support the roughly $130 billion âbase vehicleâ cost of an equivalent longer-term needs, but such estimates were beyond the number of conventional vehicles. The additional cost of sup- scope of this study. See Chapter 7. plying hydrogen over this period is $16 billion. Thus, the cumulative expenditure for the transition totals $184 billion, most of which (91 percent) is for the production of vehicles, Vehicle Deployment Costs for the Transition with the remaining 9 percent for hydrogen supply (roughly The committeeâs estimate of private plus government half for infrastructure and half for operating costs). expenditures required to deploy the maximum practicable If the RD&D costs discussed above are added to the number of fuel cell vehicles by 2020 and beyond (as reflected vehicle and hydrogen production costs, the budget roadmap by the Hydrogen Success scenario) is shown in Figure S.3, shown in Figure S.3 would increase by approximately $1 bil- which indicates total annual costs for the two main compo- lion per year ($16 billion total). This would bring the cumu- nents of commercial deployment: vehicle costs and hydrogen lative total to $200 billion for the period 2008-2023. Table fuel costs. Capital investments for infrastructure to produce S.1 summarizes the cumulative costs of the budget roadmap. 45 40 35 H2 supply operating Billions $2005 per year H2 supply capital cost 30 Fuel cell vehicle cost 25 20 15 10 5 0 08 09 22 20 23 21 10 16 18 19 12 13 15 14 17 11 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 Year FIGURE S.3â Total annual expenditures for vehicles and hydrogen supply for transition to the breakeven year for the Hydrogen Success FigureSum-3.eps case, excluding RD&D costs. The cumulative cost, shared by government and industry, totals $184 billion, of which 91 percent is the cost of fuel cell vehicles and 9 percent is the cost of hydrogen supply (about half for infrastructure costs and half for additional operating costs, mainly natural gas feedstock). The additional $16 billion in private plus government RD&D costs over this period would bring the overall total to $200 billion.
SUMMARY 11 TABLE S.1â Summary of Cumulative Budget Roadmap Costs for Transition to Hydrogen Fuel Cell Vehicles (maximum practicable number of vehicles by 2020) Total Cumulative Cost, Average Cost per HFCV on Cost Elements 2008-2023 Road 2008-2023a âBase vehicleâ cost of conventional vehicles $128 billion $23,000 Average incremental fuel cell vehicle cost relative to conventional gasoline vehicles $40 billion $7,000b Total purchase cost of fuel cell vehicles $168 billion $30,000c Infrastructure capital cost for hydrogen supply $8 billion $1,500 Total operating cost for hydrogen supply $8 billion $1,500 Total cost of hydrogen supply $16 billion $3,000 Total cost for vehicles and hydrogen fuel supply $184 billion $33,000 Estimated government share of total vehicle and hydrogen fuel supply cost $50 billion $8,500 Government RD&D funding $5 billion $1,000 Private RD&D funding $11 billion $2,000 Total funding for government and private RD&D $16 billion $3,000 Total cost for vehicles, hydrogen, and all RD&D $200 billiond $36,000 Estimated government share of total cost for vehicles, hydrogen, and RD&D $55 billion $9,500 aRounded estimates based on 5.54 million HFCVs on the road in 2023. bThe final (learned-out) incremental cost per vehicle in 2023 is $3,600. cThe final (learned-out) cost per vehicle in 2023 is $27,000. dIncludes $128 billion âbase vehicleâ cost of conventional vehicles that would have been purchased instead of HFCVs. NOTE: All costs in constant 2005 U.S. dollars. Beyond 2023 the hydrogen vehicle and infrastructure system Adding government RD&D costs to the figures above pays for itself. would increase the budget roadmap by approximately $300 million per year, or a total of $5 billion. This would bring the cumulative government investment to $5 billion (an average Government Share of Transition Costs of $9,500 per vehicle) from 2008 through 2023, as summa- The question of how the vehicle production and hydrogen rized in Table S.1. This translates to an average of roughly supply costs shown in Figure S.3 should be shared between $3 billion per year over 16 years (2008-2023). To put these the federal government and private industry has no simple amounts in perspective, the U.S. government subsidy for or single answer. In the committeeâs judgment, a realistic ethanol fuel in 2006 was approximately $2.5 billion and, if estimate of the government share of total costs to facilitate extended at the current rate,Â could grow to $15 billion per the maximum practicable transition to HFCVs (based on the year in 2020Â due to the recently enacted (December 2007) Hydrogen Success scenario) would be the incremental cost of energy bill. purchasing HFCVs, plus about half the total cost of building and operating the infrastructure needed to supply hydrogen during the transition period. Those incremental costs are shown in Figure S.4. In this case, the added cost for vehicles totals $40 billion over the transition period (as noted above), The Volumetric Ethanol Excise Tax Credit (VEETC) of 51 cents per while hydrogen infrastructure costs add another $8 billion. gallon benefits all ethanol blended with gasoline, which was about 5 bil- lion gallons in 2006, according to DOE data. Although the VEETC is set to Various factors could either reduce or raise these costs to expire after 2010, Congress is debating various ways of extending it, as it some degree (see Chapter 7). The committee estimated the has since the credit was first created inÂ 1978. The Energy Independence and total government cost for this scenario to be approximately Security Act of 2007 established a renewable fuel standard that would reach $50 billion (an average of $8,500 per vehicle during the 30 billion gallons by 2020, most of which isÂ likely to be ethanol. A credit transition period). of 51 cents per gallon applied to that amount would represent a subsidy in excess of $15 billion per year.
12 TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIESâA focus on hydrogen 8 7 6 Billions $2005 per year H2 supply capital cost 5 Incremental vehicle cost 4 3 2 1 0 08 09 22 20 23 21 10 16 18 12 13 15 19 14 17 11 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 Year FIGURE S.4â Annual government expenditures through the transition to 2023. Estimated expenditures are based only on the incremental costs of fuel cell vehicles over conventional vehicles, plus the capital cost for hydrogen infrastructure, for the Hydrogen Success scenario FigureSum-4.eps (excluding RD&D costs). The cumulative cost is $48 billion, of which 83 percent is the cost of vehicles and 16 percent is the cost of hydrogen infrastructure. Government RD&D costs over this period total an additional $5 billion. Other Cost Considerations the technical and cost targets assumed in the maximum practicable analysis, the governmentâs share of costs could While the committeeâs budget roadmap considered only be reduced. Similarly, to the extent that HFCV imports from the funding required to launch the maximum practicable sce- non-U.S. automakers contribute to the hydrogen transition, nario for fuel cell vehicles, it is unlikely that federal funding the magnitude of U.S. government-supported vehicle costs would terminate after the breakeven year for transition, as also would be reduced. But progress may be slower than assumed here. Rather, continued expenditures at some level assumed here, and pushing HFCVs into the market would would be expected, although the committee did not attempt then be more expensive than shown in Figure S.3. Before to estimate such requirements. companies and the government start ramping up the funding Note, too, that the budget roadmaps presented here do not for the transition in about 2015, it will be important to fully reflect the savings to consumers from reduced expenditures assess the state of the technology and expectations for the for gasoline during 2012-2023 (estimated at roughly $17 market. Insofar as progress is either faster or slower than billion) or the loss of government tax revenues from gaso- expected, it will be important to adjust policies in response, line sales displaced by hydrogen (roughly $5 billion). Also, while avoiding the perception that promotional policies are the budget estimates do not include any costs for technical not durable. educational or training programs to support the transition, Finally, the committee notes that the budget roadmaps because the committee estimated no shortage of workers developed in this study apply only to the transition period with the needed skills during this period (see Chapter 7). through 2023. However, the successful introduction of Other types of training programs (e.g., safety training) are HFCVs also would involve substantial longer-term expen- likely to be needed. dituresâprimarily by the private sectorâfor infrastructure, There is considerable uncertainty in predicting the costs energy resources, and other requirements of a full-scale of deploying HFCVs, in particular technical success, oil HFCV-based transportation system. Estimates of longer-term prices, and carbon policy. To the extent that HFCVs exceed
SUMMARY 13 capital requirements and other resource needs for the Hydro- higher than for comparable gasoline vehicles. Without large gen Success scenario can be found in Chapters 6 and 7 of this incentives, consumers also may be reluctant to switch in report, along with a discussion of issues such as long-term significant numbers to a new and unfamiliar type of vehicle labor force requirements that remain for future study. and fuel. As noted above, policy measures that significantly limit CO2 emissions also will be required to ensure that CONCLUSION 9: The estimated government cost to sup- hydrogen is produced in ways that do not add to the burden port a transition to hydrogen fuel cell vehicles is roughly of greenhouse gas emissions. $55 billion over the 16-year period from 2008 to 2023, Durable incentives, lasting 15-20 years or more, also primarily for the production of fuel cell vehicles ($40 would be critical for setting private sector expectations about billion of incremental cost) and, to a lesser extent, for the long-run payoffs to investments with high up-front costs. the initial deployment of hydrogen supply infrastructure However, subsidies should be progressively phased out over (about $10 billion) and R&D (about $5 billion). No short- time as long-term penetration targets are approached, in ages are foreseen in the critical workforce skills needed order to limit government funding requirements and encour- to accomplish the transition. However, further study is age firms to act more quickly in the earlier years of the pro- necessary to assess the longer-term costs, institutional gram. Coordination of financial incentives with the technical issues, workforce issues, and impacts of undertaking the progress of the program is therefore crucial. major hydrogen infrastructure development required to Ultimately, however, the heart of any policy actions to support widespread use of HFCVs. See ChapterÂ 7. promote substantial HFCV penetration must be the incen- tives or requirements for auto manufacturers to develop and mass-produce hydrogen vehicles consistent with the budget Actions Required by Government to Implement the roadmaps presented above and motivated by the goals of Transition national energy and environmental policies. Chapter 8 pro- Six types of actions and policies are needed to exploit the vides further discussions of policy design. potential of hydrogen to reduce oil use and CO2 emissions from the transportation sector, consistent with the Hydrogen CONCLUSION 10: Policies designed to accelerate the Success case described in this report: penetration of HFCVs into the U.S. vehicle market will be required to exploit the long-term potential of HFCVs. 1. Actions to ensure continued development of HFCVs The committee concluded that these policies must be technologies, durable over the transition time frame but should be 2. Actions to deal with the high initial cost of HFCVs, structured so that they are tied to technology and market 3. Actions to develop the initial infrastructure needed to progress, with any subsidies phased out over time. Such support HFCVs, policies are likely to deliver significant long-term reduc- 4. Actions to reduce the cost of the initial distributed tions in U.S. oil demand, but additional policies limiting infrastructure for hydrogen, greenhouse gas emissions will be required in order to also 5. Policies that promote energy security by improving the reduce CO2 emissions significantly. See Chapter 8. end use efficiency of transportation fuels, and 6. Policies that limit greenhouse gas emissions to ensure Synergies with the Electric Power Sector that hydrogen produced using domestic energy resources results in little or no emission of CO2 to the atmosphere. The committee also was asked to consider the role that hydrogen in stationary electric power might play in stimu- More specifically, to stimulate RD&D to overcome lating a transition to hydrogen-fueled vehicles. There are remaining technical hurdles and encourage long-run pen- potential synergies between the transportation and electric etration of hydrogen vehicles, a technology-push approach power sectors that could benefit both sectors in the near term (i.e., not relying simply on market forces) is required. Such and longer term. an approach would have to employ policies and incentives In the near term, the electric power sector has the potential that are carefully targeted, substantial, durable, and gradually to accelerate the volume of hydrogen available for fuel cell phased out over time with continued technology progress. vehicles during the transition period by producing electric- However, the design and the choice of such policies are ity targeted for electrolysis of water to generate hydrogen neither simple nor straightforward. for transportation. While large central electrolyzers appear Targeted policies to kick-start a market for hydrogen not to be competitive with other central plant technologies, vehicles could include such measures as federal tax credits, the use of small-scale electrolyzers at a refueling site could subsidies for hydrogen vehicle purchases, or minimum sales play an important role during the start-up phase (from about share quotas imposed on vehicle manufacturers. If financial 2012 to 2025), when the cost burden of larger-scale natural incentives are used, they would have to be substantial, given gas reforming plants is a potential barrier to hydrogen supply. that life-cycle costs for hydrogen vehicles are currently much The committeeâs analysis indicated that small-scale elec-
14 TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIESâA focus on hydrogen trolysis, although in general more expensive than hydrogen transportation sector and the electric power sector could from distributed natural gas reforming, might nonetheless accelerate the potential for reduced oil use and decreased supply hydrogen to areas with limited access to natural gas CO2 emissions as benefits from the use of hydrogen in or to other locations in particular situations. Electric utili- both sectors. In the near term, electrolysis of water at ties, working with state utility commissions, could provide refueling sites using off-peak power, and in the longer economic incentives to reduce the cost burden of the elec- term (after 2025), cogeneration of low-carbon hydrogen trolysis process. The impact of electricity cost on hydrogen and electricity in gasification-based energy plants, are production cost is discussed in Chapter 3. In addition, DOE potential options that offer additional synergies. See and several companies have R&D programs to reduce the Chapter 5. cost of electrolysis. In the longer term (e.g., 2025 through 2050), there is a potential of Alternative technologies potential for synergy in the use of hydrogen for stationary power generation and for transportation. The key enabling The committee also was asked to consider whether technologies envisioned as sources of hydrogen in the com- other technologies would be less expensive or could be mitteeâs scenarios are gasification plants fed either by bio- implemented more quickly than HFCVs to achieve sig- mass or by coal with CCS. Coal-based hydrogen at the scale nificant reductions in CO2 emissions and oil imports. The envisioned is anticipated to use the same type of equipment committee concluded that a rigorous assessment of the used in integrated gasification combined cycle (IGCC) power costs and impacts of all technologies that compete with plants projected to be built in the future. Thus, hydrogen HFCVs would require a level of effort beyond the scope produced from gasification can be used as a fuel either for and resources of the current study. Thus, the committee stationary power generation or for export to the transporta- approached this task as one intended to provide context for tion market. For coal-based hydrogen production, CCS will the development of HFCVsânot one intended to identify be required to avoid significant CO2 emissions. Biomass gas- specific âtechnology winnersâ that might be preferable to ification, however, is a potentially carbon-neutral source of HFCVs. For purposes of analysis, the committee therefore hydrogen. Although other power plant technologies, such as chose to focus on the impacts, but not the costs, of one nuclear and renewable energy systems, also could be used to vehicle alternative and one fuel alternative for reducing oil generate carbon-free hydrogen (mainly via electrolysis), gas- use and CO2 emissions: (1) evolutionary internal combus- ification-based systems are the most economical approach in tion engine vehicles (ICEVs), including gasoline-hybrid the committeeâs assessment. electric vehicles, and (2) the use of biofuelsâspecifically A potential synergy not explicitly modeled in the com- ethanol and biodieselâto replace petroleum-based fuels. mitteeâs analysis is that IGCC plants with CCS also offer The committee did not evaluate the impact of other vehicle a potential remedy to the âchicken-and-eggâ problem of or fuel technologies as explained above, but it recognizes the providing incentives for initial investments in large-scale potential of advanced technologies such as PHEVs to achieve hydrogen production facilities needed to reduce future significant reductions in oil use and CO2 emissions if they hydrogen costs during and after the transition period. The are successfully deployed. Such technologies are discussed flexibility of gasification systems to provide electric power as further in Chapters 4-6. well as hydrogen can significantly reduce the financial risks The following sections briefly summarize the committeeâs associated with large-scale hydrogen production during the assumptions regarding potential developments in advanced scale-up phase of HFCV commercialization. conventional vehicles and biofuels. To assess the potential As noted above in the discussion of technical readiness, impacts of such developments on reducing oil use and CO2 several key issues still must be resolved to achieve the poten- emissions, the committee analyzed these assumptions using tial synergies described. Foremost is the need to demonstrate the same analytical model it employed to assess potential the production of coal-based hydrogen or electricity with impacts of HFCVs. In addition, the committee attempted CCS at a commercial scale (e.g., an electrical equivalent to match the degree of technological optimism and aggres- of several hundred megawatts) within the next decade. In sive implementation of the Hydrogen Success case for both the committeeâs view, such demonstrations are required to alternative cases. Results of those analyses also are sum- enable decisions about the applicability and deployment marized below. of central hydrogen production with CCS in the 2025 time frame, as assumed in the Hydrogen Success scenario. Again, Advanced Conventional Vehicles utilities and other companies, working with their regulatory commissions, could be given incentives to pursue the large- Conventional power trains and vehicles have continued scale demonstration of these technologies more rapidly. to improve since the invention of the automobile more than 100 years ago. The committee found significant potential to CONCLUSION 11: With appropriate policies or mar- continue this evolution through improvements in engine and ket conditions in place, potential synergies between the transmission efficiency, aerodynamic design, and reductions
SUMMARY 15 in rolling resistance, weight, and accessory loads. Much Such assessments are by no means straightforward of the recent progress in these areas has been directed to because of the complexities and uncertainties in accounting enhancing vehicle performance and size rather than reduc- for oil use and greenhouse gas emissions across the chain ing fuel consumption. However, if future improvements to of processes involved in biofuel production (see Chapter gasoline-powered vehicles were used exclusively for fuel 4). Recent papers in the literature addressing the potential economy gains, this study estimates that oil consumption and for soil root carbon CO2 release from land use changes greenhouse gas emissions per mile of travel for new vehicles indicate the difficulty of these complexities. The most com- could be reduced by almost 30 percent in 2020, more than 40 mon biofuel produced in the United States is ethanol made percent by 2035, and about 50 percent by 2050 compared to from fermenting corn kernels. Because the energy content average vehicles in 2006. In all cases, however, policy mea- of ethanol is less than that of gasoline, roughly 30 percent sures (such as the 2007 CAFE standards) and/or significant more ethanol by volume is needed to replace each gallon of long-term increases in fuel costs probably will be required gasoline. Furthermore, because petroleum-based fuels are to realize these potential fuel economy gains in a significant used in growing and producing corn ethanol, net reductions number of on-road vehicles. Absent such policies or large in both oil use and greenhouse gas emissions are greatly fuel cost increases, the committee expects that much of the diminished relative to the impacts of equivalent energy from conventional technology potential will either remain unused gasoline. Although some agricultural and ethanol production or be directed to attributes other than fuel economy. practices could yield greater reductions (such as ethanol The committee further estimated that evolutionary produced from sugar cane), othersâsuch as processes using improvements in current gasoline-electric hybrid vehiclesâa coal-based energy or the clearing of existing forest to plant more revolutionary and more recent approach to power train cornâcould increase greenhouse gas emissions compared designâcould reduce fuel consumption and greenhouse gas to gasoline. The committee also found that the potential to emissions per mile for new vehicles by about 50 percent in drive up food prices made it unlikely that more than about 2020, more than 60 percent by 2035, and nearly 70 percent 25 percent of U.S. corn crops would be devoted to ethanol, by 2050 compared to todayâs conventional gasoline vehicles. which would limit corn-based ethanol to about 12 billion gal- Reaching this full potential will likely require adoption of lons after 2015 (the energy equivalent of less than 6 percent many of the evolutionary vehicle and power train improve- of the reference case gasoline demand for light-duty vehicles ments for conventional vehicles, as well as further progress in that year and a still smaller percentage in later years). on battery technology. Chapter 4 elaborates on the technical The technology to produce cellulosic ethanolâethanol basis for the efficiency improvements outlined above. These from woody biomass, grasses, or crop residuesâis not yet technologies will increase the initial costs of vehicles, but demonstrated for commercial production but is actively savings in fuel cost will accrue over the life of the vehicle being developed. The committee found that if successful, it and thus could offset costs to the consumer on a life-cycle could reduce oil use by more than 90 percent and greenhouse basis. gas emissions by roughly 85 percent compared to equivalent gasoline use in light-duty vehicles. The committee estimated CONCLUSION 12: Continued advancements in conven- that domestic resources for cellulosic biomass would allow tional vehicles offer significant potential to reduce oil use production of about 45 billion to 60 billion gallons of cellu- and CO2 emissions through improved fuel economy, but losic ethanol by 2050, potentially displacing about 20 percent policy measures and/or significant long-term increases of the baseline gasoline demand estimate for that year. in fuel cost probably will be required to realize these Biodiesel, a fuel produced from animal or plant oils such potential fuel economy gains in a significant number of as soy, would reduce oil use and greenhouse gas emissions on-road vehicles. See Chapter 4. similarly to cellulosic ethanol. Producing biodiesel is a sim- pler process that is already commercial. If biodiesel were produced from current sources (e.g., soybeans), the potential Biofuels impact on commodity prices would limit its potential to Automotive fuels produced from crops or other forms roughly 30 percent of the soy crop, which would provide of biomass have the potential to further reduce oil imports slightly more than 1Â billion gallons of biodiesel by 2020. and CO2 emissions. As in the case of vehicle technologies, This would displace a very small fraction of diesel demand biomass feedstocks and conversion technologies span a in that year, based on committee estimates. The potential range of levels of development and maturity. There is also for biodiesel fuels was thus judged to be small unless break- a corresponding lack of information about when processes throughs are achieved in areas such as oil production from in the early stages of development might become commer- algae. cial. Therefore, this study used options for which more data were available to assess the potential of biofuels to offer CONCLUSION 13: Although use of corn- and oil-based earlier reductions in oil use and CO2 emissions compared biofuels can provide some benefits in reducing U.S. oil use to HFCVs. and CO2 emissions, cellulosic biofuels will be required
16 TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIESâA focus on hydrogen for such benefits to be significant. Lower-cost biofuel and about 60 mpg by 2050. In Case 2, the growing penetra- production methods and conversion processes will have tion of hybrids gained them an 80 percent share of the total to be developed for large-scale commercialization, but vehicle market by 2050 (see Chapter 6). These estimates the initial high costs of biofuels, together with other assume that the evolutionary technologies result in efficiency barriers, may limit their market potential, absent policy improvements and that consumers buy them. interventions or significant oil price increases or supply Case 3 (Biofuels) assumed aggressive development and disruptions. See Chapter 4. use of biofuels to power the conventional vehicles of the baseline scenario. Most of this biofuel was in the form of cellulosic ethanol, which was to reach commercialization Impacts of Alternative Technologies on Oil Use and CO2 by 2010 (based on DOEâs biofuels roadmap), followed by Emissions rapid expansion to 16 billion gallons per year in 2020, 32 To evaluate whether alternative technologies might be billion gallons per year in 2035, and 63 billion gallons per implemented more quickly than HFCVs to achieve signifi- year in 2050. Grain-based ethanol production was assumed cant reductions in oil use and CO2 emissions, the committee to reach a maximum of 12 billion gallons per year by 2015 extended the modeling framework described above for HFCVs and to remain at that level through 2050. to include two alternativesâevolutionary vehicles and biofuel Full details of the assumptions used to analyze alterna- technologies. As with hydrogen, such modeling estimates are tive vehicles and biofuels appear in Chapters 4 and 6 of uncertain because of the complexities and unknowns inher- this report. Here, the major results and implications of that ent in any analysis of future transportation systems and fuel analysis are highlighted. options. Insights from modeling were nonetheless of signifi- The results from Case 2 (ICEV Efficiency) (Figure S.5) cant value in informing the committeeâs judgment about the indicate that aggressive fuel economy improvements in potential impacts of alternatives to hydrogen. conventional light-duty and hybrid vehicles follow the refer- Toward this end, the committee developed and analyzed ence case, which includes the 2007 CAFE standards through additional scenarios for the two selected alternative tech- 2020, but then could potentially deliver greater reductions in nologies with technological optimism and aggressive imple- U.S. oil demand and CO2 emissions compared to the Hydro- mentation similar to those for the Hydrogen Success case gen Success scenario, through about 2040. Subsequently, (the maximum practicable case). Case 2 (ICEV Efficiency) under the assumptions of this scenario, the rates of growth focused on improvements to conventional vehicles. This case in the benefits of potential efficiency improvements begin shows (based on the analysis in Chapter 4) that aggressive to slow at a time when benefits from the Hydrogen Success implementation of evolutionary technology improvements case are still increasing. Breakthroughs and rapid market for gasoline vehicles raised the average on-road fuel economy penetration in other developing vehicle technologies, such as (which is typically 20 percent lower than the Environmental plug-in hybrids and diesel hybrids, potentially could increase Protection Agencyâs âstickerâ miles per gallon [mpg]) of the the benefits of reduced oil consumption and CO2 emissions light-duty fleet to about 30 mpg by 2020 and to nearly 40 above those shown in Case 2 (ICEV Efficiency), particularly mpg by 2035, with a small additional improvement by 2050. in the 2030-2050 time frame. Conventional hybrid vehicles were estimated to improve to The results of Case 3 (Biofuels) (also shown in Figure S.5) about 45 mpg by 2020, and then to about 55 mpg by 2035 suggest that biofuels alone also could potentially reduce oil 180,000 Million tonnes CO2 eq/yr 2000 Million gallons per year 160,000 Case 1 (H2 140,000 Success) 1500 Case 1 (H2 Success) 120,000 Case 2 (ICEV Eff) Case 2 (ICEV Eff) 100,000 1000 80,000 Case 3 (Biofuels) Case 3 (Biofuels) 60,000 Reference 500 40,000 Reference 20,000 0 0 2000 2010 2020 2030 2040 2050 2000 2010 2020 2030 2040 2050 Year Year FIGURE S.5â Comparison of (left) annual gasoline use and (right) annual greenhouse gas emissions (as equivalent CO 2) for Cases 1-3 FigureSum-5b.eps compared with the reference case. color FigureSum-5a.eps
SUMMARY 17 demand and greenhouse gas emissions (measured as equiva- and HFCVs should be considered not as competitors over lent CO2 of all greenhouse gas emissions over the fuel cycle) the next few decades, but as part of a portfolio of options sooner than the Hydrogen Success case, if cellulosic ethanol with a potential to deliver significant energy security and comes online by 2010 and grows aggressively thereafter. environmental benefits across a variety of time horizons. As with Case 2 (ICEV) efficiency improvements, however, Other technologies not analyzed in this study, such as plug-in the rate of growth in benefits from biofuels implementation hybrids, battery electric vehicles, and other types of internal begins to slow toward the end of the analysis period. In 2030- combustion engines, also should be examined as potential 2040, the Hydrogen Success case has the potential to provide candidates for this portfolio. As in other domains, a portfolio greater reductions and, by 2040, delivers two to three times of technology options is most likely to improve the chances the reductions in oil use and CO2 emissions as the aggressive of success while reducing the risks in the event that any one biofuels scenario. option fails to deliver on its promise. Chapter 6 also presents the results of several additional Because advanced conventional vehicles, hybrid vehicles, cases involving combinations of alternative technologies. and biofuels can deliver benefits in a shorter time frame, they Although these scenarios give quantitative results different may be able to more quickly reduce the potential impacts from those shown here, the qualitative conclusion is simi- of climate change and reliance on oil imports, while also larâthat is, alternative technologies can deliver significant providing the time needed to further develop and commer- oil use and CO2 emission reduction benefits earlier than cialize hydrogen-based fuel cell technologies. Also, should HFCVs, but the largest sustained longer-term benefits are the impacts of climate change or oil shocks mobilize an achieved using hydrogen fuel cell vehicles. aggressive policy response, acceleration of HFCVs into the market could provide a path toward a zero-petroleum and CONCLUSION 14: The committeeâs analysis indicates potentially low-carbon option that can persist beyond the that at least two alternatives to HFCVsâadvanced con- large, but eventually limited, potential of vehicle efficiency ventional vehicles and biofuelsâhave the potential to and biofuels alone. provide significant reductions in projected oil imports To explore the value of a portfolio approach, the com- and CO2 emissions. However, the rate of growth of ben- mittee constructed Case 4 (Portfolio), which combines all efits from each of these two measures slows after two or three options of vehicle efficiency, biofuels, and HFCVs (see three decades, while the growth rate of projected benefits Chapter 6). Compared to the reference baseline scenario, the from fuel cell vehicles is still increasing. The deepest cuts results showed that this portfolio of options has the potential 180,000 in oil use and CO2 emissions after about 2040 would come to nearly eliminate oil demand from light-duty vehicles by 160,000 Million gallons per year from hydrogen. See Chapter 6. the140,000 of the century, while reducing greenhouse gas middle emissions by almost a factor of 10 relative to the assumed 120,000 baseline case (Figure S.6). Achieving this potential (Portfolio) 100,000 Case 4 is likely Benefits of a Portfolio Approach to require a portfolio approach that takes advantage of the 80,000 Reference Based on a comparison of the three scenarios in Figure 60,000 synergies among these technologies. For example, many of S.5, the committee concluded that no single approach is the 40,000 technologies needed to improve the fuel economy of 20,000 likely to deliver both significant midterm and long-term conventional vehicles, including weight reduction, improved 0 reductions in oil demand and greenhouse gas emissions. aerodynamics,2010 2020 2030 resistance, and low accessories 2000 lower rolling 2040 2050 Thus, conventional and hybrid vehicle technology, biofuels, loads, also will be essential for fuel cell vehicles to reach the Year 180,000 1800 160,000 Million gallons per year 1600 Million tonnes CO2 eq/yr 140,000 1400 120,000 1200 100,000 Case 4 (Portfolio) 1000 Case 4 (Portfolio) 80,000 Reference 800 Reference 60,000 40,000 600 20,000 400 0 200 2000 2010 2020 2030 2040 2050 0 Year 2000 2010 2020 2030 2040 2050 Year FIGURE S.6â Impact of combining the potential of HFCVs with advanced conventional vehicles, hybrid vehicles, and biofuels in a portfolio color FigureSum-6.eps approachâCase 4: (Left) annual gasoline use and (right) annual greenhouse gas emissions. 1800 1600 s CO2 eq/yr 1400 1200 1000 Case 4 (Portfolio)
18 TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIESâA focus on hydrogen efficiency levels assumed in this study. Similarly, advance- technological approach and improves the probability that ments in battery and electronics technology for hybrids will the United States can meet its energy and environmental likely find direct application in fuel cell vehicles, while some goals. Other technologies also may hold promise as part technologies used to produce biofuels also could be adopted of a portfolio, but further study is required to assess their for hydrogen production (such as gasification of biomass or potential impacts. See Chapter 9. on-site reformers using biomass). REFERENCES CONCLUSION 15 (same as Conclusion 1): A portfolio of technologies including hydrogen fuel cell vehicles, EIA (Energy Information Administration). 2008. Annual Energy Outlook 2008: With Projections to 2030. Report DOE/EIA-0383. Washington, D.C. improved efficiency of conventional vehicles, hybrids, and Greene, D., P. Leiby, and D. Bowman. 2007. Integrated Analysis of Market use of biofuelsâin conjunction with required new policy Transformation Scenarios with HyTrans. Oak Ridge National Labora- driversâhas the potential to nearly eliminate gasoline tory, Oak Ridge, Tenn. use in light-duty vehicles by the middle of this century, Gronich, S. 2007. 2010-2025 Hydrogen Scenario Analysis. Presentation to while reducing fleet greenhouse gas emissions to less the committee, February 20. NRC (National Research Council). 2004. The Hydrogen Economy: Op- than 20 percent of current levels. This portfolio approach portunities, Costs, Barriers, and R&D Needs. Washington, D.C.: The provides a hedge against potential shortfalls in any one National Academies Press.