Can Hydrogen Cars Reduce America’s Oil Dependence?
By Daveed Gartenstein-Ross
FDD Policy Briefing
July 8, 2008
In early June, Honda introduced its latest hydrogen-powered fuel cell vehicle, the FCX Clarity, to great fanfare. The Clarity’s predecessor was the FCX, which became the first U.S. government-approved fuel cell vehicle in 2002. The Clarity offers a number of advances over the FCX, including a 30% increase in range. The vehicle’s reception is reflected in such publications as Consumer Affairs, which noted that the car seems attractive at a time of high oil prices and ecological awareness: “Here is a vehicle that doesn’t require oil to operate. While it doesn’t run on water, its hydrogen fuel is made from water. There are no carbon emissions, only water vapor.” And the New York Times claimed that fuel cells have an ecological advantage over electric cars because electricity “is often produced by coal-burning power plants.”
Yet despite the positive press attention that the Clarity has received, the high cost of hydrogen cars and the hydrogen fueling infrastructure mean that this technology is unlikely to reduce our oil dependence anytime soon. Moreover, hydrogen’s advocates have overstated the environmental benefits of these cars.
The High Cost of Hydrogen Cars
The Clarity is marketed to a narrow segment of the population. According to Honda’s web site, the company will only deliver 150 Clarity vehicles “in the first three years of its fuel cell lease program.” Rather than selling the car outright, Honda will enter into three-year leases with consumers for $600 a month. The geographic areas where these leases will occur are limited because there are few markets with hydrogen fueling stations: in the U.S., the Clarity will only be available to Californians who reside in Torrance, Santa Monica, or Irvine.
If and when the Clarity becomes available for purchase, it will likewise be marketed selectively. Honda president Takeo Fukui told the New York Times that each unit of the Clarity costs several hundred thousand dollars to produce, but “said that should drop below $100,000 in less than a decade as production volumes increase.” Toyota has made a similar promise, vowing to reduce the price tag for a fuel cell car from $1 million today (a price that is largely theoretical) to $50,000 by 2015. Even at these steeply reduced prices, fuel cell cars would be quite expensive. As an analytic report commissioned by the Department of Energy concluded in 2002, even under optimistic assumptions about technological development, “factory costs of future FCVs [fuel cell vehicles] would likely be 40-60% higher than conventional vehicles.”
Two further costs magnify the expenses associated with fuel-cell vehicles. One is the cost of producing hydrogen for fuel, which is not cheap. If hydrogen were produced from renewable sources—as many of its advocates suggest—production costs would likely be between $10 to $20 per gallon of gasoline equivalent. A second cost is the lifetime of fuel-cell vehicles. F. David Doty, the president of Doty Scientific, writes that “[w]e’re still waiting to see a fuel-cell vehicle driven from Miami to Maine via the Smoky Mountains in the winter. Then, we need to see one hold up to a 40-minute daily commute for more than two years with minimal maintenance, and come through a highway accident with less than $200K in damages.” Since the Clarity will only be driven in the balmy confines of Southern California, it will be unable to alleviate concerns about the vehicles’ susceptibility to harsh climate conditions.
Fuel Infrastructure Costs
In addition to the cost of the car, one must consider the cost of the fueling infrastructure needed to make hydrogen vehicles a viable replacement. British Petroleum’s chief scientist noted in 2003 that for hydrogen to succeed as a transportation fuel “it has to be available in 30 to 50% of the retail network from the day the first mass manufactured cars hit the showrooms.” Joseph J. Romm, who served in a number of high-level positions in the Clinton administration’s Department of Energy, writes in his definitive 2005 book The Hype About Hydrogen that “a hydrogen fueling infrastructure alone based on current commercial or near-commercial technology could cost more than a half trillion dollars.”
A fueling infrastructure would cost more for hydrogen than for other alternatives to petroleum, such as biofuels. Standard liquid fuel tanks are insufficient for hydrogen distribution since hydrogen can only be converted to liquid form at -423 degrees Fahrenheit (36 degrees from absolute zero). Thus, Brookings Institution energy and environment scholar David Sandalow notes in his 2008 book Freedom from Oil that in order to carry hydrogen, fuel service stations would require new varieties of tanks “capable of handling pressurized gaseous material or supercooled liquid.” The cost to these stations would be high.
Indeed, the cost of getting hydrogen to the fueling stations in the first place would be considerable. Hydrogen pipelines are likely the least expensive long-term method for large-scale hydrogen delivery. Yet Romm writes about this distribution method:
Hydrogen pipelines are very expensive, in part because they are carrying a fuel that is very diffuse and prone to leaks. Hydrogen is also highly reactive. It can cause many metals, including steel, to become brittle over time. Large-scale interstate hydrogen pipelines (nine to fourteen inches in diameter) have a capital cost of $1 million per mile or more, whereas smaller pipelines for local distribution might cost half of that.
Other methods of distributing hydrogen fuel, such as tanker trucks and trailers carrying compressed hydrogen canisters, similarly pose problems. Sandalow notes, for example, that “[t]o transport the same amount of energy as contained in one gasoline tanker, 10 trucks of compressed hydrogen would be needed.”
Thus, when I interviewed Romm after the Clarity’s release, he told me that hydrogen vehicles face “two chicken-and-egg problems.” One classic chicken-and-egg problem involves fueling stations: the stations won’t stock hydrogen fuel until a large number of people drive hydrogen vehicles, yet few consumers will buy these cars before stations carry fuel for them. The second chicken-and-egg problem involves economies of scale. Car companies can only bring down fuel cell vehicle costs through economies of scale after a sufficient number of people buy them, yet few consumers will purchase them before companies bring down the costs. To Romm, fuel cell vehicles face one chicken-and-egg problem too many.
Since less than 7% of the vehicle fleet is replaced every year, hydrogen cars are unlikely to make a big market dent: given their high sticker price and lack of fueling infrastructure, hydrogen cars will at best be a small fraction of the annual fleet turnover. Moreover, the demographic that can afford hydrogen vehicles is also the demographic that can best absorb high gas prices.
Environmental Benefits Overstated
I quoted the New York Times’ claim above that fuel cell vehicles have an advantage over electric cars because electricity “is often produced by coal-burning power plants.” Coal plants do indeed comprise about half of the U.S.’s energy generation—and coal energy emits a great deal of carbon dioxide, which is a potent greenhouse gas. However, hydrogen is a carrier of energy in hydrogen cars rather than an independent source of energy. As FDD senior fellow Robert Zubrin has written:
Hydrogen is only a source of energy if it can be taken in its pure form and reacted with another chemical, such as oxygen. But all the hydrogen on Earth, except that in hydrocarbons, has already been oxidized, so none of it is available as fuel. If you want to get plentiful unbound hydrogen, the closest place it can be found is on the surface of the Sun; mining this hydrogen supply would be quite a trick. After the Sun, the next closest source of free hydrogen would be the atmosphere of Jupiter. Jupiter is surrounded by radiation belts so intense that they are deadly to humans and electronics…. So if we put aside the spectacularly improbable prospect of fueling our planet with extraterrestrial hydrogen imports, the only way to get free hydrogen on Earth is to make it. The trouble is that making hydrogen requires more energy than the hydrogen so produced can provide. Hydrogen, therefore, is not a source of energy. It simply is a carrier of energy.
Thus, the energy still has to come from somewhere. To that extent, in a blog entry Romm wrote for the Massachusetts Institute of Technology’s Technology Review, he deflates the Times’ logic that hydrogen cars are superior to electric vehicles from an environmental perspective. Since 95% of hydrogen in the U.S. is made from natural gas, he reasons that “running a car on hydrogen doesn’t reduce net carbon dioxide emissions compared with a hybrid like the Prius running on gasoline.”
A second problem from an environmental perspective is that hydrogen is an inefficient carrier of energy. Romm concludes that electric cars and plug-in hybrids actually “have an enormous advantage over hydrogen fuel-cell vehicles … because of the inherent inefficiency of the entire hydrogen fueling process, from generating the hydrogen with that electricity to transporting this diffuse gas long distances, getting the hydrogen in the car, and then running it through a fuel cell.” Due to the greater efficiency of electric motors, plug-in hybrid vehicles would still emit less carbon dioxide than gasoline engines even if all their energy came from coal plants (which is, of course, an unrealistically pessimistic assumption).
Hydrogen’s advocates argue that one major benefit of fuel cell cars is that the energy to power them can be derived from renewable sources, such as solar or wind power. In addition to the high cost of producing hydrogen from renewable sources (mentioned above), this argument overlooks the fact that electric cars can also be powered by renewable sources. Moreover, renewable energy could be fed directly into the power grid rather than hydrogen vehicles—thus reducing the percentage of the power grid that relies on coal generation. Given the greater efficiencies of electric cars and plug-in hybrids, this seems a better alternative.
The Clarity faces a number of disadvantages, including immense costs, possible durability problems, and lack of hydrogen fueling stations. Though the car averages 72 miles per kilogram of hydrogen (77 city and 67 highway), the lack of fueling stations makes its 280-mile range a concern. While these problems may be lessened as fuel-cell vehicles become more widely available, the fact remains that even under the most wildly optimistic scenarios hydrogen will not be a viable transportation alternative for 85-90% of our population for decades. Even the cost projections offered by Honda and Toyota may be overly optimistic. It would not be the first time an automaker had overestimated its ability to make hydrogen commercially available: in 1997, Daimler-Benz promised that it would sell at least 100,000 hydrogen fuel-cell vehicles by 2005.
Biofuels, plug-in hybrids, and electric cars are more realistic alternatives than hydrogen vehicles. It is important that our resources be devoted to alternatives to oil that can make a difference now—as opposed to pinning our hopes on technological advances that are unlikely to have a cognizable impact for at least three decades, if ever.
See the original article here.