[House Hearing, 108 Congress]
[From the U.S. Government Publishing Office]
REVIEWING THE HYDROGEN FUEL
AND FREEDOMCAR INITIATIVES
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON SCIENCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED EIGHTH CONGRESS
SECOND SESSION
__________
MARCH 3, 2004
__________
Serial No. 108-44
__________
Printed for the use of the Committee on Science
Available via the World Wide Web: http://www.house.gov/science
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______
COMMITTEE ON SCIENCE
HON. SHERWOOD L. BOEHLERT, New York, Chairman
RALPH M. HALL, Texas BART GORDON, Tennessee
LAMAR S. SMITH, Texas JERRY F. COSTELLO, Illinois
CURT WELDON, Pennsylvania EDDIE BERNICE JOHNSON, Texas
DANA ROHRABACHER, California LYNN C. WOOLSEY, California
KEN CALVERT, California NICK LAMPSON, Texas
NICK SMITH, Michigan JOHN B. LARSON, Connecticut
ROSCOE G. BARTLETT, Maryland MARK UDALL, Colorado
VERNON J. EHLERS, Michigan DAVID WU, Oregon
GIL GUTKNECHT, Minnesota MICHAEL M. HONDA, California
GEORGE R. NETHERCUTT, JR., BRAD MILLER, North Carolina
Washington LINCOLN DAVIS, Tennessee
FRANK D. LUCAS, Oklahoma SHEILA JACKSON LEE, Texas
JUDY BIGGERT, Illinois ZOE LOFGREN, California
WAYNE T. GILCHREST, Maryland BRAD SHERMAN, California
W. TODD AKIN, Missouri BRIAN BAIRD, Washington
TIMOTHY V. JOHNSON, Illinois DENNIS MOORE, Kansas
MELISSA A. HART, Pennsylvania ANTHONY D. WEINER, New York
J. RANDY FORBES, Virginia JIM MATHESON, Utah
PHIL GINGREY, Georgia DENNIS A. CARDOZA, California
ROB BISHOP, Utah VACANCY
MICHAEL C. BURGESS, Texas VACANCY
JO BONNER, Alabama VACANCY
TOM FEENEY, Florida
RANDY NEUGEBAUER, Texas
VACANCY
C O N T E N T S
March 3, 2004
Page
Witness List..................................................... 2
Hearing Charter.................................................. 3
Opening Statements
Statement by Representative Sherwood L. Boehlert, Chairman,
Committee on Science, U.S. House of Representatives............ 11
Written Statement............................................ 12
Statement by Representative Bart Gordon, Ranking Minority Member,
Committee on Science, U.S. House of Representatives............ 13
Statement by Representative Judy Biggert, Chairman, Subcommittee
on Energy, Committee on Science, U.S. House of Representatives. 14
Written Statement............................................ 15
Prepared Statement by Representative Michael C. Burgess, Member,
Committee on Science, U.S. House of Representatives............ 16
Prepared Statement by Representative Jerry F. Costello, Member,
Committee on Science, U.S. House of Representatives............ 16
Prepared Statement by Representative Eddie Bernice Johnson,
Member, Committee on Science, U.S. House of Representatives.... 17
Prepared Statement by Representative John B. Larson, Member,
Committee on Science, U.S. House of Representatives............ 17
Prepared Statement by Representative Michael M. Honda, Member,
Committee on Science, U.S. House of Representatives............ 18
Witnesses:
Mr. David Garman, Assistant Secretary, Energy Efficiency and
Renewable Energy, Department of Energy
Oral Statement............................................... 19
Written Statement............................................ 20
Biography.................................................... 26
Dr. Michael P. Ramage, Chair, National Academy of Sciences
Committee on Alternatives and Strategies for Future Hydrogen
Production and Use
Oral Statement............................................... 27
Written Statement............................................ 28
Biography.................................................... 37
Dr. Peter Eisenberger, Chair, American Physical Society, Panel on
Public Affairs, Energy Subcommittee
Oral Statement............................................... 39
Written Statement............................................ 41
Biography.................................................... 42
Discussion....................................................... 43
Appendix 1: Answers to Post-Hearing Questions
Mr. David Garman, Assistant Secretary, Energy Efficiency and
Renewable Energy, Department of Energy......................... 64
Appendix 2: Additional Material for the Record
Hydrogen Posture Plan, An Integrated Research, Development, and
Demonstration Plan, U.S. Department of Energy, February 2004... 90
The Hydrogen Initiative, American Physical Society, Panel on
Public Affairs, March 23004.................................... 143
Statement by Dr. Joseph Romm, Former Acting Assistant Secretary
of Energy...................................................... 160
REVIEWING THE HYDROGEN FUEL AND FREEDOMCAR INITIATIVES
----------
WEDNESDAY, MARCH 3, 2004
House of Representatives,
Committee on Science,
Washington, DC.
The Committee met, pursuant to call, at 2:28 p.m., in Room
2318 of the Rayburn House Office Building, Hon. Sherwood L.
Boehlert (Chairman of the Committee) presiding.
hearing charter
COMMITTEE ON SCIENCE
U.S. HOUSE OF REPRESENTATIVES
Reviewing the Hydrogen Fuel
and FreedomCAR Initiatives
wednesday, march 3, 2004
2:00 p.m.-4:00 p.m.
2318 rayburn house office building
1. Purpose
On Wednesday, March 3, 2004, the U.S. House of Representatives'
Committee on Science will hold a hearing to examine the Department of
Energy's (DOE) Hydrogen Fuel and FreedomCAR initiatives. Specifically,
the hearing will focus on two recent reports from the National Academy
of Sciences (NAS) and the American Physical Society (APS) on DOE's
hydrogen initiatives, and the Administration's response to the
recommendations from the reports. The hydrogen program is one of the
President's primary energy initiatives, and the two reports recommend
changes to the program.
2. Witnesses
Mr. David Garman is the Assistant Secretary of Energy Efficiency and
Renewable Energy at the Department of Energy. Prior to joining the
Department, Mr. Garman served as Chief of Staff to Alaska Senator Frank
Murkowski and has served on the professional staff of the Senate Energy
and Natural Resources Committee and the Senate Select Committee on
Intelligence.
Dr. Michael Ramage is the Chair of the National Academy of Sciences'
(NAS), Committee on Alternatives and Strategies for Future Hydrogen
Production and Use. Dr. Ramage is a retired executive vice president at
ExxonMobil Research and Engineering Company.
Dr. Peter Eisenberger is the Chair of the American Physical Society's
(APS) Panel on Public Affairs Energy Subcommittee. Dr. Eisenberger is
currently a Professor of Earth and Environmental Sciences at Columbia
University, and has extensive academic and corporate research
experience at Harvard, Stanford, Princeton, Exxon, and Bell
Laboratories.
3. Overarching Questions
The hearing will address the following overarching questions:
Are the Hydrogen Fuel and FreedomCAR initiatives on
track to provide a viable alternative to petroleum as a
transportation fuel?
Are the goals of the Hydrogen Fuel and FreedomCAR
initiatives appropriate and realistic? Are the initiatives
designed to meet their goals?
What are the most important recommendations from the
NAS and APS reports? How is the Department responding to the
recommendations?
Will technology research alone lead to a transition
to hydrogen, or will it be necessary to apply policy tools? How
should a research and development effort take these policy
choices into account?
4. Overview
In his 2003 State of the Union speech, President Bush
announced the creation of a new Hydrogen Fuel Initiative, which
built on the FreedomCAR initiative announced in 2002. Together,
the initiatives aim to provide the technology for a hydrogen-
based transportation economy, including production of hydrogen,
transportation and distribution of hydrogen, and the vehicles
that will use the hydrogen. Fuel cell cars running on hydrogen
would emit only water vapor and, if domestic energy sources
were used, would not be dependent on foreign fuels.
The recent reports from the American Physical Society
(APS) and the National Academy of Sciences (NAS) both recommend
changes to the hydrogen initiatives, particularly arguing for a
greater emphasis on basic, exploratory research because of the
significant, perhaps insurmountable, technical barriers that
must be overcome. The APS report strongly cautions DOE against
premature demonstration projects, saying such projects could
repeat the government's unhappy experience with the synthetic
fuels programs of the 1970s.
The NAS study describes DOE's near-term milestones
for fuel cell vehicles as ``unrealistically aggressive.'' Both
reports note that it will require technical breakthroughs--not
just incremental improvements--to meet the goals of the overall
hydrogen initiative. For example, the APS study states, ``No
material exists today that can be used to construct a hydrogen
fuel tank that can meet the consumer benchmarks.''
The NAS study finds that in the DOE hydrogen program
plan, the ``priorities are unclear.'' The NAS study calls for
``increased emphasis'' on fuel cell vehicle development,
distributed hydrogen generation, infrastructure analysis,
carbon sequestration and carbon dioxide-free energy
technologies.
The NAS report notes that DOE needs to think about
policy questions as it develops its research and development
(R&D) agenda: ``Significant industry investments in advance of
market forces will not be made unless government creates a
business environment that reflects societal priorities with
respect to greenhouse gas emissions and oil imports.. . .The
DOE should estimate what levels of investment over time are
required--and in which program and project areas--in order to
achieve a significant reduction in carbon dioxide emissions
from passenger vehicles by mid-century.''
While the President's fiscal year 2005 (FY05) budget
request includes additional funding for hydrogen R&D, it
provides the money for hydrogen research by making cuts in
other energy efficiency and renewable energy R&D programs. The
APS report specifically argues against such an approach, and
the NAS report notes that research on other aspects of
renewable energy may be necessary for a successful transition
to a hydrogen economy.
The APS report recommends that DOE continue research
into bridge technologies--such as gasoline or diesel hybrids
and hydrogen-fueled internal combustion engines--that could
provide benefits if the commercialization of fuel cell vehicles
is delayed.
5. Background
Report Recommendations
NAS report recommendations summary
The NAS report raises ``four pivotal questions'' about the
transition to a hydrogen economy:
When will vehicular fuel cells achieve the
durability, efficiency, cost, and performance needed to gain a
meaningful share of the automotive market? The future demand
for hydrogen depends on the answer.
Can carbon be captured and sequestered in a manner
that provides adequate environmental protection but allows
hydrogen to remain cost-competitive? The entire future of
carbonaceous fuels in a hydrogen economy may depend on the
answer.
Can vehicular hydrogen storage systems be developed
that offer cost and safety equivalent to that of fuels in use
today? The future of transportation use depends on the answer.
Can an economic transition to an entirely new energy
infrastructure, both the supply and the demand side, be
achieved in the face of competition from the accustomed
benefits of the current infrastructure? The future of the
hydrogen economy depends on the answer.\1\
---------------------------------------------------------------------------
\1\ The Hydrogen Economy: Opportunities, Costs, Barriers, and R&D
Needs. NAS pre-publication copy, pp. 2-13.
The report examines possible answers to the questions and
recommends changes to the DOE hydrogen R&D program. The study concludes
that, even under the most optimistic scenario, ``[T]he impacts on oil
imports and CO2 emissions are likely to be minor during the
next 25 years.'' The report goes on to add, ``[T]hereafter, if R&D is
successful and large investments are made in hydrogen and fuel cells,
the impact on the U.S. energy system could be great.''
The report's recommendations are summarized below.
Major NAS Recommendations:
Systems Analysis--DOE should undertake more systems analysis
to better understand the challenges, progress, and potential benefits
of making the transition to a hydrogen economy.
Fuel Cell Vehicle Technology--DOE should increase funding for
fundamental research and development of fuel cells focusing on on-board
storage systems, fuel cell costs, and durability.
Infrastructure--DOE should provide ``greater emphasis and
support'' to research, especially exploratory research, related to the
creation of a hydrogen infrastructure. DOE should ``create better
linkages between its seemingly disconnected programs in large-scale and
small-scale hydrogen production.''
Infrastructure--DOE should accelerate work on codes and
standards, particularly addressing overlapping regulation at the
municipal, State, and federal levels.
Transition--DOE should strengthen its policy analysis to
better understand what government actions will be needed to bring about
a hydrogen economy.
Transition--DOE should increase investments in research and
development related to distributed hydrogen production.
Safety--DOE should make changes to hydrogen safety programs,
including developing safety policy goals with stakeholders.
Carbon Dioxide-Free Hydrogen--DOE should increase emphasis on
electrolyzer development with a target of $125 per kilowatt with 70
percent efficiency. In parallel, DOE should set more aggressive
electricity cost targets for unsubsidized nuclear and renewable energy
that might be used to produce hydrogen.
Carbon Capture and Storage--DOE should link its hydrogen
programs more closely with its programs on carbon sequestration (which
are managed by Fossil Energy).
RDD Plan--DOE should set clearer priorities for hydrogen R&D
and better integrate related programs spread among several DOE offices.
Congress should stop earmarking funds for hydrogen R&D.
RDD Plan--DOE should shift work away from development and
toward exploratory work and should establish interdisciplinary energy
research centers at universities.
Framework--DOE should give greater emphasis to fuel cell
vehicle development, distributed hydrogen generation, infrastructure
analysis, carbon sequestration and FutureGen, and carbon dioxide-free
energy technologies.
APS report recommendations summary
The APS recommendations are generally consistent with those of NAS.
The primary recommendation of the APS report is that DOE should
significantly increase the funding for basic research in the hydrogen
initiative, while reducing the funding for demonstrations. The report
outlines the various technical barriers facing each stage of hydrogen
usage, and the fundamental research breakthroughs that are needed to
make the initiative a success. APS concludes that large-scale
demonstrations are generally premature because so many technological
hurdles still must be cleared.
The APS report also recommends that the Administration increase
funding for ``bridge'' technologies--such as hydrogen internal
combustion engines and gasoline and diesel hybrid vehicles--that would
provide benefits sooner than hydrogen fuel cell vehicles, particularly
if technical barriers slow the market penetration of the fuel cell
vehicles. The APS report also argues that the hydrogen initiatives
should not displace other efficiency and renewable energy research if
the goals of the initiative are to be met. Renewable energy generation,
APS argues, is crucial to supplying clean, domestic energy for hydrogen
production.
Challenges
What are the technical challenges?
Major advances are needed across a wide range of technologies if
hydrogen is to be affordable, safe, cleanly produced, and readily
distributed. The production, storage and use of hydrogen all present
significant challenges.
Hydrogen can be produced from a variety of sources, including coal
and natural gas. But one goal of using hydrogen is to reduce emissions
of carbon dioxide. If hydrogen is to be produced without emissions of
carbon dioxide, then the technology to capture and store carbon dioxide
(known as carbon sequestration) must improve significantly. The other
main goal of using hydrogen is to reduce the use of imported energy.
Today most hydrogen is produced from natural gas, but in order to
supply the entire transportation sector significant imports of natural
gas would be required. Other possible means of producing hydrogen are
inherently cleaner than coal, but are far from affordable with existing
technology. For example, the APS estimates that hydrogen produced
through electrolysis is currently four to ten times more expensive than
gasoline.
Another major hurdle is finding ways to store hydrogen,
particularly on board a vehicle. APS believes ``a new material must be
discovered'' to develop an affordable hydrogen fuel tank.
The NAS estimates that fuel cells themselves will need a ten- to
twenty-fold improvement before fuel cell vehicles become competitive
with conventional technology. Today's fuel cells also wear out quickly,
and are therefore far short of the durability that would be required to
compete with a gasoline engine. Finally, if hydrogen is going to be
produced on a large-scale, dramatic improvements in pipeline and tanker
technology are required to permit the efficient and safe transportation
and distribution of hydrogen. Small-scale distributed production also
needs improvement, and the NAS report recommends increased focus in
that area because it may be the first to develop.
What are the non-technical challenges? (policy, regulatory, inertia,
public awareness)
Even if the technology advances to a point at which it is
competitive, the transition to a hydrogen economy will require an
enormous investment to create a new infrastructure. Changes in
regulation, training and public habits and attitudes will also be
necessary. Estimates of the cost of creating a fueling infrastructure
(replacing or altering gas stations) alone are in the hundreds of
billions of dollars.
The transition also won't happen quickly. According to the NAS
study, significant sales of hydrogen vehicles are unlikely before 2025
even under the most optimistic technology assumptions.
Technology
What is a Fuel Cell?
Central to the operation of the hydrogen-based economy is a device
known as a fuel cell that would convert hydrogen fuels to electricity.
In cars, these devices would be connected to electric motors that would
provide the power now supplied by gasoline engines. A fuel cell
produces electricity by means of an electrochemical reaction much like
a battery. However, there is an important difference. Rather than using
up the chemicals inside the cells, a fuel cell uses hydrogen fuel, and
oxygen extracted from the air, to produce electricity. As long as
hydrogen fuel and oxygen are fed into the fuel cell, it will continue
to generate electric power.
Different types of fuel cells work with different electrochemical
reactions. Currently most automakers are considering Proton Exchange
Membrane (PEM) fuel cells for their vehicles.
Benefits of a Hydrogen-based Economy
A hydrogen-based economy could have two important benefits. First,
hydrogen can be manufactured from a variety of sources, including
natural gas, biofuels, petroleum, coal, and even by passing electricity
through water (electrolysis). Depending on the choice of source,
hydrogen could substantially reduce our dependence on foreign oil and
natural gas.
Second, the consumption of hydrogen through fuel cells yields water
as its only emission. Other considerations, such as the by-products of
the hydrogen production process, will also be important in choosing the
source of the hydrogen. For example, natural gas is the current
feedstock for industrial hydrogen, but its production releases carbon
dioxide; production from coal releases more carbon dioxide and other
emissions; and production from water means that pollution may be
created by the generation of electricity used in electrolysis.
Production from solar electricity would mean no pollution in the
generation process or in consumption, but is currently more expensive
and less efficient than other methods.
Industry participation
Although exact numbers on industry involvement are proprietary, the
major automobile companies have invested billions of dollars in R&D and
demonstrations of fuel cell vehicles. General Motors alone had spent $1
billion as of June 2003, and estimated that its total investment by
2010 could triple.
Legislation
Language in the portion of the comprehensive Energy Bill (H.R. 6)
produced by the Science Committee would authorize and guide the
hydrogen initiative. The conference report on H.R. 6 is still pending
in the Senate.
6. Questions to the Witnesses
The witnesses have been asked to address the National Academy of
Sciences' (NAS) and American Physical Society's (APS) recent reports
and recommendations on the hydrogen initiatives in their testimony, and
in addition the following specific questions.
Mr. David Garman:
1. The NAS report describes the goals of the initiatives as
``unrealistically aggressive'' while the APS report highlights
the significant ``performance gaps'' between current technology
and the initiative milestones. Does the Department of Energy
(DOE) plan to adjust the goals based on the comments of these
reports? If not, how does DOE plan to respond?
2. Because of the significant technical challenges, both
reports criticized the current mix of funding for hydrogen
research, arguing that more emphasis should be placed on
fundamental research as opposed to demonstrations. Please
describe the hydrogen program's current demonstration and
deployment efforts, and how each technology element's current
costs and performance measure against the program goals. Does
DOE plan to adjust the balance of funding to match the
recommendations? If not, why?
3. The NAS report suggests that the research agenda should be
developed with future policy decisions in mind. How did the
Administration consider the impact of future policy decisions
in the development of the research agenda for the hydrogen
initiatives? Does DOE plan on increasing its policy analysis
capabilities as recommended by the NAS?
4. What are the key criteria for deciding that a technology is
ready for demonstration? Are there guidelines or rules of
thumb, such as 120 percent of cost goals, or 85 percent of
performance goals that indicate that a technology is ready for
demonstration-scale activities?
5. Using the definitions in OMB Circular A-11, what is the
proposed mix of funding in the FY05 budget request between
basic research, applied research, development, demonstration,
and deployment activities within the Hydrogen Fuel Initiative?
Dr. Michael Ramage:
1. Given the current state of hydrogen technology, what do you
feel the federal funding balance should be between
demonstration and research?
2. One of the recommendations included in the NAS report calls
for an expanded policy analysis program at the Department of
Energy. Please describe why the committee felt this was
important, and give more detail as to what such a program might
encompass.
3. In the penetration models included in the NAS study, the
committee assumes that the technical goals will be met, even
though they are deemed overly optimistic. What would be more
realistic goals? How would that affect the penetration models?
What would that imply for the delivery of public benefits such
as environmental improvements and reduced oil dependence?
4. What are the key criteria for deciding that a technology is
ready for demonstration? Are there guidelines or rules of
thumb, such as reaching 120 percent of cost goals, or 85
percent of performance goals, that indicate that a technology
is ready for demonstration-scale activities?
5. While the NAS report recommends shifting funding away from
``bridge'' technologies such as gasoline and diesel hybrids and
hydrogen internal combustion engines, another recently released
report from the American Physical Society (APS) encourages DOE
to increase funding in these areas in light of their near-term
benefits. How would you respond to the APS recommendation? What
do you feel is the reason for the different opinions about
federal investment in bridge technologies?
Dr. Peter Eisenberger:
1. One of the major themes of the APS report is the lack of
funding for basic research. The report notes that the
Department's request of $29 million in the Office of Science
for fiscal year 2005 was a dramatic improvement, but says that
the amount of basic research is still inadequate at 13 percent
of the overall hydrogen funding. What do you feel the balance
should be? How should it change over time?
2. What are the key criteria for deciding that a technology is
ready for demonstration? Are there guidelines or rules of
thumb, such as reaching 120 percent of cost goals, or 85
percent of performance goals, that indicate that a technology
is ready for demonstration-scale activities?
3. While the APS report encourages DOE to increase funding to
``bridge'' technologies such as gasoline and diesel hybrids and
hydrogen internal combustion engines, another recently released
report from the National Academy of Sciences (NAS) recommends
shifting funds away from bridge technologies. How would you
respond to the NAS recommendation? What do you feel is the
reason for the different opinions about federal investment in
bridge technologies?
Chairman Boehlert. The Committee will be in order. Now
prior to our hearing, I must ask your patience while I complete
one brief administrative matter. Specifically, I would like to
ask the Committee for unanimous consent to discharge House
Joint Resolution 57, expressing the sense of Congress that the
Congress recognize the contributions of the seven Columbia
astronauts by supporting the establishment of a Columbia
Memorial Science Learning Center in Downey, California. I know
that there is strong bipartisan support for this resolution,
and I understand the support of the entire California
delegation. Therefore, without objection, so ordered.
I want to welcome everyone here for this important hearing
on one of the President's key initiatives. This hearing is
important because what is at stake over the long-term is the
security of our nation, the availability of resources for
economic growth here and around the world, and the health of
the environment, nationally and globally, not exactly minor
issues. The President is to be congratulated for his foresight
in proposing the Hydrogen Initiative. It will take at least a
decade of focused effort to lay the foundation for a hydrogen
economy.
The question before us today is not whether to have a
hydrogen initiative, but how to make sure we get the most out
of what we are spending on this program. If we think of the
Hydrogen Initiative as a car, which I think is an appropriate
analogy, then I would say that the President has bought us the
car and the Secretary of Energy has turned the ignition key,
but everyone is still learning how to drive and no one has
mapped out a clear travel plan yet.
So we are at a critical juncture in the development of this
initiative, and I am pleased that we will be able to get
guidance today from two prestigious organizations: the National
Academy of Sciences (NAS), and the American Physical Society
(APS), represented here by two distinguished researchers. I
found the recommendations in their two reports to be
compelling, and I hope we will be able to hear some specifics
today about exactly how the Department of Energy (DOE) is going
to implement them. Clearly, this is a valuable program that
could be better focused with greater emphasis on solving
fundamental questions.
I am pleased that we have Secretary Garman back with us
today, a good friend, one who has appeared here many, many
times, to tell us how DOE intends to proceed. He is a leading
light in the Department and a true believer in these
technologies. And he has his work cut out for him with this
initiative. I also want to thank Secretary Garman for appearing
before us during a week in which he has already made a number
of congressional appearances, but I am sure that as a former
Senate staffer he feels he just can't spend too much time up
here.
Before we hear from our witnesses, I want to highlight two
points made in the reports I referred to earlier that go beyond
the technical recommendations, points I have made in previous
hearings on this subject. First, most reports acknowledge that
there is no way to discuss the transition to a hydrogen economy
or the research to get us there without dealing forthrightly
with policy questions. No mysterious market force alone is
going to produce a hydrogen economy. I would urge DOE again to
make that acknowledgment itself and to plan accordingly. We
can't, for example, have a sensible hydrogen R&D agenda without
making some decisions about essential carbon sequestration, how
that is going to be in a hydrogen economy. Personally, I think
it has to be essential, but we need a decision by DOE. Second,
both reports note that other work on energy efficiency and
renewable energy is necessary for a hydrogen economy to be
clean and affordable, and both reports are right.
So I think it is unfortunate that the Administration
proposes to pay for hydrogen research by cutting the rest of
Secretary Garman's programs. We have been told in the past that
such triage would not occur, and it shouldn't.
Finally, let me say that I also agree with these reports
when they point out that hydrogen is no panacea, especially in
the short-term. Work on hydrogen should be not used an excuse--
as an excuse to avoid steps we need to take now, steps like
stricter CAFE standards, like promoting hybrid vehicles, like
conducting R&D on interim solutions to our energy dependence
and pollution problems.
Our focus at this hearing is on the Hydrogen Initiative
itself. I hope we can reach some consensus today on how the
research agenda can be reshaped to increase the likelihood that
hydrogen can someday become the answer to our energy and
environmental needs.
Mr. Gordon.
[The prepared statement of Chairman Boehlert follows:]
Prepared Statement of Chairman Sherwood Boehlert
I want to welcome everyone here for this important hearing on one
of the President's key initiatives. This hearing is important because
what's at stake, over the long term, is the security of our nation, the
availability of resources for economic growth here and around the
world, and the health of the environment, nationally and globally. Not
exactly minor issues.
The President is to be congratulated for his foresight in proposing
the hydrogen initiative. It will take at least a decade of focused
effort to lay the foundations for a hydrogen economy.
The question before us today is not whether to have a hydrogen
initiative, but how to make sure we get the most out of what we're
spending on this program. If we think of the hydrogen initiative as a
car--an appropriate analogy--then I would say that the President has
bought us the car and the Secretary of Energy has turned the ignition
key, but everyone is still learning how to drive, and no one has mapped
out a clear travel plan yet.
So, we're at a critical juncture in the development of this
initiative. And I'm pleased that we'll be able to get guidance today
from two prestigious organizations, the National Academy of Sciences
and the American Physical Society, represented here by two
distinguished researchers.
I found the recommendations in their two reports to be compelling.
And I hope we'll be able to hear some specifics today about exactly how
the Department of Energy (DOE) is going to implement them. Clearly this
is a valuable program that could be better focused, with greater
emphasis on solving fundamental questions.
I'm pleased that we have Secretary Garman back with us today to
tell us how DOE intends to proceed. He is a leading light in the
Department and a true believer in these technologies, and he has his
work cut out for him with this initiative. I also want to thank
Secretary Garman for appearing before us during a week in which he
already has many Congressional appearances. But I'm sure that as a
former Senate staffer he feels he just can't spend too much time up
here.
Before we hear from our witnesses, I want to highlight two points
made in these reports that go beyond the technical recommendations--
points I've made in previous hearings on this subject.
First, both reports acknowledge that there is no way to discuss the
transition to a hydrogen economy--or the research to get us there--
without dealing forthrightly with policy questions. No mysterious
market force alone is going to produce a hydrogen economy. I would urge
DOE again to make that acknowledgement itself and to plan accordingly.
We can't, for example, have a sensible hydrogen R&D agenda without
making some decisions about how essential carbon sequestration is going
to be in a hydrogen economy. Personally, I think it has to be
essential, but we need a decision by DOE.
Second, both reports note that other work on energy efficiency and
renewable energy is necessary for a hydrogen economy to be clean and
affordable--and both reports are right. So I think it's unfortunate
that the Administration proposes to pay for hydrogen research by
cutting the rest of Secretary Garman's programs. We've been told in the
past that such triage would not occur. It shouldn't.
Finally, let me say that I also agree with these reports when they
point out that hydrogen is no panacea, especially in the short-term.
Work on hydrogen should not be used as an excuse to avoid steps we need
to take now--steps like stricter CAFE standards, like promoting hybrid
vehicles, like conducting R&D on interim solutions to our energy
dependence and pollution problems.
But our focus at this hearing is on the hydrogen initiative itself.
I hope we can reach some consensus today on how the research agenda can
be reshaped to increase the likelihood that hydrogen can some day
become the answer to our energy and environmental needs.
Mr. Gordon.
Mr. Gordon. Thank you, Mr. Chairman. I always enjoy
listening to you, because I just agree with you so much on what
you say. It is such a nice thing to have a sensible chairman.
Thank you for giving me my opportunity also.
In my part of Tennessee, we have a special interest in
hydrogen fuel vehicles in the form of Dr. Cliff Rickets at
Middle Tennessee State University. For many years, Dr. Rickets
has been working with alternative fuels and has built cars that
run on everything from corn to cow manure. Since the late
'80's, he has been working with hydrogen fuel engines. In fact,
in 1991, he built a car that set the world land speed record
for hydrogen at the Bonneville speed trials at the Great Salt
Flats in Utah. The next year, his team went back and broke his
own record, a record that has now stood for more than 10 years.
And in Tennessee, we come about our interests in hydrogen
honestly and believe that in addition to going fast, we can
also transition to a fuel that can be cleaner and reduce our
need for imported oil. But we have to be sensible and smart
about how we go about it, and that is the subject of this
hearing. The importance of energy to society can not be
overstated. Since prehistoric--or prehistory, the survival and
the advancement of civilization has depended on the ability to
secure energy resources. From the gathering of wood to the
burning of fossil fuels to the fission of nuclear materials,
our quest for energy has shaped the world, as we know it. The
agricultural and industrial revolutions of the last two
centuries would not have been possible had it not been for
coal, oil, and natural gas.
However, finding alternatives to fossil fuels is
imperative. We have known this for a generation yet no viable,
cost-efficient alternative has emerged. Hydrogen has developed
as a potential solution to our energy puzzle, but will it work?
And furthermore, will it work within the timeline and technical
goals laid out by the Administration's Hydrogen Initiative.
With over two billion internal combustion engines in the world,
a switch to a hydrogen-based economy is no easy task, and that
is why I am pleased that we have these very informed officials
with us today. And I look forward to hearing from you and
taking us further down this path.
Thank you, Mr. Chairman.
Chairman Boehlert. Thank you very much, Mr. Gordon.
The Chair recognizes the distinguished Chair of the
Subcommittee on Energy, Ms. Biggert.
Ms. Biggert. Thank you very much, Mr. Chairman. And thank
you for calling this hearing and giving this committee another
opportunity to get an update on the work underway at the
Department of Energy as part of the President's Hydrogen Fuel
and FreedomCAR Initiatives. I also want to thank the witnesses
for being so generous with their time and for agreeing to share
with us their insight and expertise on the topic of fuel cells
and hydrogen.
I have a keen interest in both the fuel cell and Hydrogen
Initiatives that President Bush announced in 2002 and 2003
respectively. As a matter of fact, in June of 2002, I chaired a
field hearing in Naperville, Illinois to examine the potential
of hydrogen fuel cell technology. My District is, of course,
home to Argonne National Laboratory, which has a strong fuel
cell R&D program. My District is also home to small businesses
like H2Fuels and various auto parts suppliers, corporations
like BP, and research organizations like the Gas Technology
Institute. In short, I have the privilege to represent a region
that has much to contribute to the continuing development of
fuel cells and the hydrogen needed to fuel them.
As I have said many times before, I do not believe that
affordable energy and a clean and safe environment are mutually
exclusive. America has the ingenuity and the expertise to meet
our nation's future energy demands and promote energy
conservation. And we can do so in environmentally responsible
ways that set a standard for the world. Most importantly,
America now has the motivation, perhaps like no other time
since the oil crisis of the '70's, to find newer and better
ways to meet our energy needs.
Let us look at the facts. Our dependence on foreign oil
sources is up almost--to almost 60 percent. Violence in the
Middle East and the War Against Terrorism will continue to
cause more volatility in gasoline prices that any of us will
find acceptable. The bottom line is that the United States is
home to only two percent of the world's supply of oil. It
doesn't take a chemical engineer or a foreign policy expert to
understand what that equals: continued dependency on
increasingly uncertain sources.
There clearly are some compelling reasons to work toward
our shared vision of a hydrogen economy. Today we will hear
testimony about two recent reports, one prepared by the
National Academy of Sciences, the other one by the American
Physical Science Society, that raises questions about our
progress in making that vision a reality.
We are talking about a tremendously challenging endeavor.
It will take us many years to reach our goal. It only makes
sense that we will need to make a few mid-course corrections
along the way, that is why we should be asking are the goals we
initially set still the right goals. If so, we must next ask
are we working to meet our goals in the best way that we can.
For instance, many fundamental technical obstacles remain in
hydrogen production, transport, and storage, not to mention the
technical challenges that we must address before fuel cell
vehicles become a common future of American life.
To overcome these obstacles, the Federal Government must
maintain a strong commitment to basic research. If the road we
are on turns out to be a dead end, we should have an
alternative route already mapped out. That is the reason a
diverse portfolio of basic research is so important to long-
term technology initiatives like the ones we are discussing
today. Our job at this hearing is to look at what we have
learned in the first year or two of our efforts and to gain
insight from NAS and APS reports. Both recommend greater
emphasis on basic research, which I think is the right course
of action, and both point out that a great deal of work lies
ahead.
I am confident that DOE is up to the task, and with the
constructive input of groups like NAS and APS, we will move the
Nation ever closer to realizing the promise and potential of
fuel cells and hydrogen.
Thank you very much, Mr. Chairman, and I yield back.
[The prepared statement of Mrs. Biggert follows:]
Prepared Statement of Representative Judy Biggert
Thank you, Chairman Boehlert, for calling this hearing and giving
this committee another opportunity to get an update on the work
underway at the Department of Energy as part of the President's
Hydrogen Fuel and FreedomCAR initiatives. I also want to thank the
witnesses for being so generous with their time, and for agreeing to
share with us their insight and expertise on the topics of fuel cells
and hydrogen.
I have a keen interest in both the fuel cell and hydrogen
initiatives that the President announced in 2002 and 2003 respectively.
As a matter of fact, in June 2002, I chaired a field hearing in
Naperville, Illinois to examine the potential of hydrogen fuel cell
technology. My district is, of course, home to Argonne National
Laboratory, which has a strong fuel cell R&D program. My district also
is home to small businesses like H2Fuels and various auto parts
suppliers, corporations like BP, and research organizations like the
Gas Technology Institute. In short, I have the privilege to represent a
region that has much to contribute to the continued development of fuel
cells and the hydrogen needed to fuel them.
As I've said many times before, I do not believe that affordable
energy and a clean and safe environment are mutually exclusive. America
has the ingenuity and the expertise to meet our future energy demands
and promote energy conservation, and we can do so in environmentally
responsible ways that set a standard for the world. Most importantly,
America now has the motivation--perhaps like no other time since the
oil crisis of the 70's--to find newer and better ways to meet our
energy needs.
Let's look at the facts. Our dependence on foreign oil sources is
up to almost 60 percent. Violence in the Middle East and the war
against terrorism will continue to cause more volatility in gasoline
prices than any of us will find acceptable. The bottom line is that the
United States is home to only two percent of the world's supply of oil.
It doesn't take a chemical engineer or a foreign policy expert to
understand what that equals--continued dependence on increasingly
uncertain sources.
There clearly are many compelling reasons to work towards our
shared vision of a hydrogen economy. Today, we will hear testimony
about two recent reports--one prepared by the National Academy of
Sciences, the other by the American Physical Society--that raise
questions about our progress in making that vision a reality.
We are talking about a tremendously challenging endeavor. It will
take us many years to reach our goal. It only makes sense that we might
need to make a few mid-course corrections along the way. That's why we
need to be asking, ``Are the goals we set initially still the right
goals?'' If so, we need to next ask, ``Are we working to meet our goals
in the best way that we can?''
For instance, many fundamental technical obstacles remain in
hydrogen production, transport, and storage--not to mention the
technical challenges that we must address before fuel cell vehicles
become a common feature of American life. To overcome these obstacles,
the Federal Government must maintain a strong commitment to basic
research. If the road we're on turns out to be a dead-end, we should
have an alternate route already mapped out. That's the reason a diverse
portfolio of basic research is so important to long-term technology
initiatives, like the ones we are discussing today.
Our job at this hearing is to look at what we've learned in the
first year or two of our efforts, and to gain insight from the NAS and
APS reports. Both recommend greater emphasis on basic research, which I
think is the right course of action, and both point out that a great
deal of work lies ahead. I am confident that the DOE is up to the task
and, with the constructive input of groups like the NAS and APS, will
move the Nation ever-closer to realizing the promise and potential of
fuel cells and hydrogen.
Thank you.
Chairman Boehlert. Thank you very much, Ms. Biggert.
[The prepared statement by Mr. Burgess follows:]
Prepared Statement of Representative Michael C. Burgess
Thank you Mr. Chairman, and thank you for having this hearing.
I believe that energy independence is a matter of national
security. The United States is especially vulnerable to international
price fluctuations since we import nearly 60 percent of the oil we
consume daily from foreign sources, and this number is expected to
increase to 75 percent by 2010. Most of this oil comes from the Middle
East and politically unstable nations such as Algeria, Nigeria and
Venezuela. When we met one year ago, to discuss this very issue, gas
prices were soaring as a result of a two-month strike in Venezuela.
This is merely one example of how international situations can affect
the United States.
Our economy depends on access to steady, affordable and reliable
domestic energy supply; it is a matter of national security to have the
United States be self-sufficient when it comes to our energy needs. To
ensure America's energy independence, I believe that we need to
implement a long-term, comprehensive energy policy. Furthermore, one
component of this national energy policy must be alternative energy
research and development.
President Bush, during his 2001 State-of-the-Union Address,
proposed a bold FreedomCAR and Hydrogen Fuel Initiative. The goal of
this new FreedomCAR program is to make hydrogen fuel cell technology a
viable, affordable and convenient technology that we can use to power
our automobiles. There are many benefits, including a cleaner
environment, greater energy independence, and the possibility that
research can spur further technological innovation.
As a member of both the Science and Transportation and
Infrastructure Committees, I recognize the unique challenges that we
face as we discuss the possibility of converting into a hydrogen-fueled
economy. We must discuss the appropriate role for the Federal
Government in this process and examine our focus on FreedomCAR and
hydrogen-based infrastructure, but we must do so within the context of
a comprehensive energy policy. A comprehensive energy policy will help
ensure that the United States can achieve energy independence. In
addition, we must also take seriously our responsibility to ensure that
taxpayer dollars are spent wisely and must keep this in mind as we
discuss the President's Hydrogen Initiative.
So, again, Mr. Chairman, I thank you for this hearing in which we
can address some our concerns.
[The prepared statement by Mr. Costello follows:]
Prepared Statement of Representative Jerry F. Costello
Good afternoon. I want to thank the witnesses for appearing before
our committee to discuss the President's Hydrogen Initiative and two
recently released reports from the National Academy of Sciences (NAS)
and the American Physical Society (APS) on DOE's Hydrogen Initiative.
The hydrogen program is one of the President's primary energy
initiatives, and the two reports recommend changes to the program.
On February 27, 2003, the President announced the FutureGen
project. This project is a $1 billion government/industry partnership
to design, build, and operate a nearly emission-free, coal-fired
electric and hydrogen production plant. The prototype plant will serve
as a large-scale engineering laboratory for testing and will expand the
options for producing hydrogen from coal and capturing CO2.
I have led the effort to locate FutureGen in Illinois, including
leading a bipartisan effort in the House to secure funding for the
project. Further, last July, I hosted a roundtable discussion regarding
FutureGen and what it means for Illinois with Governor Blagojevich,
U.S. Senators Durbin and Fitzgerald, and U.S. Congressman John Shimkus.
Dr. C. Lowell Miller, Director of the Office of Coal Fuels and
Industrial Systems at the Department of Energy, made a presentation on
the specifics of the project.
I believe that Southern Illinois is the perfect place to locate the
new plant. The region is rich in high-sulfur coal reserves and the Coal
Center at Southern Illinois University Carbondale is located there. In
addition, the geology of the region is well suited to the carbon-
trapping technology to be developed. Illinois is home to oil and gas
reserves and deep saline aquifers that can permanently sequester carbon
dioxide.
I have been tracking this issue closely since its inception and I
am anxious to see the Department's program plan. This Administration
has touted FutureGen as one of the most important climate change
technologies at our disposal and heightened its international
visibility to extraordinary levels. If it is as important as the
Administration has said, and I believe it is, I hope that the
Administration will take a hard look at the program plan, your posture
toward industry, and seek to move on a path forward that is
technically, financially, and politically viable. We all want to make
this work, but the program will go nowhere without a sound program plan
upon which everyone agrees.
Finally, I was pleased to see the NAS and the APS both placed the
FutureGen project as a high priority task for advancing development of
hydrogen from coal.
I again thank the witnesses for being with us today and providing
testimony to our committee.
[The prepared statement by Ms. Johnson follows:]
Prepared Statement of Representative Eddie Bernice Johnson
Mr. Chair, I thank you for calling this very important hearing. Our
honored witnesses, I thank you for appearing here today to discuss such
a vital issue to our environment and our economy.
I am pleased to speak today about the promising technology that
could help protect our environment and safeguard our national security.
During his State of the Union Address a year ago, President Bush's
spelled out his plans for efficient cars running on clean, hydrogen
fuel cells. In fact, the Energy Department included $318 million for
both fuel cells and hydrogen production in its 2005 budget last month.
However, according to a report by the National Academy of Sciences,
this plan is decades away from commercial reality. While the Bush
administration anticipates mass production of hydrogen cars by 2020,
the academy calls the Energy Department's goals ``unrealistically
aggressive.''
If we don't concentrate on viable alternatives to now, the United
States is expected to import 68 percent of the oil it consumes by 2025.
Should hydrogen-powered fuel cells fulfill their promise, we could
drastically reduce that figure and ensure our independence in a way
that keeps our environment protected.
Despite the great potential of this technology, there are
significant obstacles to overcome. Usable hydrogen remains expensive to
produce and difficult to store effectively. At present fuel cells can
cost up to ten times more than conventional engines. There is important
work to do in this field, and I am proud to say that there are over a
dozen organizations in my home state of Texas hard at work on
solutions. Often Texas is thought of as oil country, but our state has
the opportunity to play a vital role in the development of viable
alternatives.
As a Ranking Member of the Research Subcommittee, I am very
interested in any technology that could help keep our environment
cleaner and our people more secure. I appreciate the opportunity to
participate and look forward to ongoing involvement in this promising
avenue of research.
[The prepared statement by Mr. Larson follows:]
Prepared Statement of Representative John B. Larson
I wanted to thank you all for testifying before the Committee
today, and I just would like to take a few moments to offer this
opening statement.
I've looked through the recent reports from the American Physical
Society (APS) and the National Academy of Sciences (NAS), and both
recommend changes to the hydrogen initiatives that argue for a greater
emphasis on basic, exploratory research because of the technical
barriers that must still be overcome, including cautions to DOE against
premature demonstration projects.
As the Ranking Member of the Energy Subcommittee, this is an issue
that I have looked closely at over the years. During debate on the
Energy bill last year, I specifically worked to support a balance
between the need for basic R&D with demonstration programs that would
put a limited number of vehicles from different sources with different
technologies in real world operating conditions.
While you are correct in identifying some of the technical hurdles
that still face extensive real world deployment of fuel cell
technology, especially in such areas as hydrogen storage and fuel cell
freeze/cold start capability, these types of demonstrations will
provide valuable benchmarking information and allow us to improve the
performance of the power plants and their integration with the vehicle
while longer-term efforts on hydrogen infrastructure are being pursued
simultaneously.
While in general I agree that deploying large numbers of vehicles,
especially using the same technological approach, is inappropriate at
this time, I do support demonstration programs using limited numbers of
light and heavy-duty vehicles to benchmark the actual performance of
these vehicles and address system integration issues. I also believe
hydrogen fuel cell buses can represent a bridging strategy that can
help us explore the use of this technology while more wide spread
infrastructure are explored.
For example, DOE's ``Controlled Hydrogen Fleet and Infrastructure
Demonstration and Validation Project'' would do exactly that: put a
limited number of light duty vehicles from different sources on the
road to demonstrate their capabilities. In addition, I believe that the
establishment of some form of a national fuel cell bus demonstration
program would be equally important, since the hydrogen infrastructure
requirements are minimal and the vehicles can perform useful work as
part of the demonstration effort while providing valuable real world
experience in technology development. While the National Academy
suggests that DOE should give greater emphasis to fuel cell vehicle
development, I would respectfully suggest that should also include the
development of heavy-duty vehicles such as transit buses in cooperation
with DOT and DOD.
Finally, I would like to point out that while the reports we are
discussing today look at current federal hydrogen initiatives in the
Department of Energy and Department of Transportation, there are
additional hydrogen and fuel cell research and development initiatives
being conducted within the Department of Defense that amounted to
roughly $50 million in FY04 alone, and to my knowledge those research
and development activities have not been directly considered in the
development of this study.
I look forward to hearing your testimony, and to the opportunity
for us to discuss these issues.
[The prepared statement by Mr. Honda follows:]
Prepared Statement of Representative Michael M. Honda
I thank Chairman Boehlert and Ranking Member Gordon for holding
this important hearing today to consider the findings of the National
Academy of Sciences and American Physical Society reports on the
hydrogen initiatives and the Administration's response to the reports.
Both reports recommend that the Department of Energy shift the
focus of work in the hydrogen program away from demonstration and
towards more basic R&D because there are significant technical barriers
to overcome. This raises several of questions that I hope this hearing
will address.
Prior demonstration programs have helped to identify some of the
very technical barriers this increased emphasis on research would aim
to overcome. I fear that we might miss more obstacles until after we
have made significant investments of time and resources if we stop
working on demonstration projects.
I also wonder what role investments made in demonstration projects
by other agencies can play. While not specifically directed at the
light duty vehicles these reports address, I know that the Santa Clara
Valley Transportation Authority's Zero Emission Bus program is funded
by a transit sales tax, the Federal Transit Administration (FTA), the
California Energy Commission (CEC), and the Bay Area Air Quality
Management District. It will be useful to know whether DOE can work
with programs like this to gain knowledge about infrastructure needs
and identify potential technical obstacles that we will need to
overcome.
The recommendations in these reports do not address what will
happen to those demonstration programs already underway. Will a
priority shift leave communities that have begun these implementation
plans out in the cold? Many of these communities undertook
demonstration programs to conform to environmental regulations, which
seems to tie in naturally with the recommendation in the NAS report
that DOE think about national policy questions that will help bring
hydrogen technologies along. I worry that by giving up on early
demonstration projects, we will actually stifle opportunities to
develop the necessary policies and shoot ourselves in the foot.
I look forward to this hearing, and hope the witnesses can address
some of these concerns.
Chairman Boehlert. Our panel today, our sole panel, as is
tradition of this committee, is composed of three very
distinguished witnesses, all of whom serve as valuable
resources for this committee. We are here to learn, but we are
also here to probe and question. Our panel consists of: David
Garman, Assistant Secretary, Energy Efficiency and Renewable
Energy at the Department of Energy; Dr. Michael Ramage, Chair,
National Academy of Science Committee on Alternatives and
Strategies for Future Hydrogen Production and Use; and Dr.
Peter Eisenberger, Chair, American Physical Society, Panel on
Public Affairs, Energy Subcommittee.
With that, I would ask all of you to try to summarize your
opening statement. The Chair will not be arbitrary. And don't
get nervous if you see that red light go on. That just
indicates that you have exceeded five minutes, but if you want
to complete a thought, or as former Secretary Richardson used
to say, a paragraph, you can do so. But we are not going to be
arbitrary, because what you have to say we need to hear.
Mr. Garman.
STATEMENT OF MR. DAVID GARMAN, ASSISTANT SECRETARY, ENERGY
EFFICIENCY AND RENEWABLE ENERGY, DEPARTMENT OF ENERGY
Mr. Garman. Thank you, Mr. Chairman and Members of the
Committee.
President Bush announced his Hydrogen Fuel Initiative a
little more than a year ago, and the President challenged us to
transform the Nation's energy future from one dependent on
foreign petroleum to one that utilizes hydrogen, a fuel that
can be produced from a variety of abundant domestic resources.
We asked the National Academy of Sciences to evaluate our plans
to transform the President's vision into reality. They did an
excellent job, and we are most grateful for their work. Their
report validates the President's vision with its major
conclusion found on page ES-2, and I quote: ``A transition to
hydrogen as a major fuel in the next 50 years could
fundamentally transform the U.S. energy system, creating
opportunities to increase energy security through the use of a
variety of domestic energy sources for hydrogen production
while reducing environmental impacts, including atmospheric
CO2 emissions and criteria pollutants,'' and that
``there is a potential for replacing, essentially, all gasoline
with hydrogen over the next half-century using only domestic
resources and thus eliminating all CO2 and criteria
pollutants from vehicular emissions.''
Also, I was most gratified to see the Academy's recognition
of the programmatic progress that we have made. On pages ES-11
and 10-10, the report states, and I quote: ``The Committee is
impressed by how well the hydrogen program has progressed.'' In
all, the study made 43 key recommendations, and if you will
allow me to dispense with nuance, at least for the oral
statement, we fully concur with 35 of those 43 recommendations
and are carefully considering the other eight. While we may not
agree with every word of every statement and finding, the
Committee said absolutely nothing that we dismiss out of hand,
and that is truly remarkable.
The only thing that I would quarrel with had been some of
the media reports, which have portrayed the long transition
time, technical obstacles, and the sheer difficulty of this
effort as if they were some kind of surprise. This is, of
course, something we have been saying all along. In fact, the
reason this is a presidential initiative announced in the State
of the Union Address is because it is a difficult undertaking
requiring sustained effort, government leadership, and a
bipartisan commitment to get the job done. And success is, by
no means, guaranteed.
There are two other points in the report that I wish to
highlight in my oral testimony. First is the issue of funding.
Last year, Congress underfunded the President's request for
hydrogen funding in the Energy and Water Appropriations Bill by
roughly $9 million and saddled us with $39 million in earmarks.
Congress also underfunded the President's request for fuel cell
work in the Interior Appropriations Bill by $19 million. In the
Omnibus Appropriations Bill, Congress added another $5.5
million for hydrogen, all of which was earmarked. So while the
hydrogen and fuel cell programs at DOE appear well funded, we
are about $67 million short of the amount of unencumbered
funding we had hoped to receive in fiscal year 2004 that could
be focused on our program plan. As an unfortunate consequence,
we will have to delay some key work in hydrogen production,
storage, and technology validation, some of the very same work
the National Academy highlighted in its report. I think the
Academy has recognized this problem and highlighted it on page
ES-12 and elsewhere in the report.
I also want to highlight one other aspect of the report,
which has been largely ignored in the media and that is well
known to this committee. As you know, some of my friends in the
renewable energy community have criticized our hydrogen program
plans, because, in addition to advancing ways to produce
hydrogen using renewable energy, we are also exploring how to
make hydrogen using nuclear and fossil energy resources,
including coal. The Committee noted the importance of the
carbon sequestration work in this endeavor, which we think is
key. And it is noteworthy that the Committee also agreed with
the critical need to explore methods of producing hydrogen from
coal and nuclear. And this ought to put to rest, once and for
all, the notion that advancing toward the hydrogen energy
economy is only environmentally advantageous if and only if all
of the hydrogen is derived from renewable energy.
So with that, Mr. Chairman, I will stop. I look forward to
the questions and discussions that will follow. Thank you very
much.
[The prepared statement of Mr. Garman follows:]
Prepared Statement of David Garman
Mr. Chairman, Members of the Committee, I appreciate the
opportunity to testify today on the President's Hydrogen Fuel
Initiative and FreedomCAR Partnership. My testimony will focus on the
recent National Academy of Engineering and National Research Council
report: The Hydrogen Economy: Opportunities, Costs, Barriers, and R&D
Needs. I will also comment on the recent report of the American
Physical Society, The Hydrogen Initiative.
At the outset I want to express the Department's appreciation for
the valuable work performed by the National Research Council which
conducted this very comprehensive study at our request. Its carefully
considered recommendations and conclusions have already helped
strengthen and focus DOE's hydrogen program and increased the
likelihood of its success. The report will also help DOE better focus
its research, priorities and funding, given the broad slate of
potential hydrogen activities and technology directions. We are
especially pleased to see the Committee's conclusion that ``transition
to hydrogen as a major fuel in the next 50 years could fundamentally
transform the U.S. energy system, creating opportunities to increase
energy security through the use of a variety of domestic energy sources
for hydrogen production while reducing environmental impacts, including
atmospheric CO2 emissions and criteria pollutants.''
Hydrogen Fuel Initiative
Mr. Chairman, it was a little more than one year ago that the
President announced a pioneering plan to transform the Nation's energy
future from one dependent on foreign petroleum to one that utilizes the
most abundant element in the universe--hydrogen. This solution holds
the potential to provide virtually limitless clean, safe, secure,
affordable, and reliable energy from domestic resources. To achieve
this vision, the President proposed that the Federal Government
significantly increase its investment in hydrogen infrastructure
research and development (R&D), including hydrogen production, storage,
and delivery technologies, as well as fuel cells, with the goal of
enabling an industry decision by 2015 to commercialize hydrogen fuel
cell vehicles.
This vision is now shared around the world. Last fall, at the
urging of Secretary Abraham, 15 nations, including the United States
and the European Union, agreed to establish the International
Partnership for the Hydrogen Economy (IPHE). The IPHE is providing a
mechanism to efficiently organize and coordinate multinational
research, development and deployment programs that advance the
transition to a global hydrogen economy. The IPHE partners represent
more than 85 percent of the world's gross domestic product and two
thirds of the world's energy consumption and greenhouse gas emissions.
At a March 5, 2003 hearing before this committee, I described in
detail DOE's plans to help turn the concept of a hydrogen-based economy
into reality. At the time we described how we would integrate our
ongoing and future hydrogen R&D activities into a focused Hydrogen
Program, and how we would integrate technology for hydrogen production
(from fossil, nuclear, and renewable resources), infrastructure
development (including delivery and storage), fuel cells, and other
technologies. We also described how we would coordinate hydrogen
activities within DOE and among the federal agencies to achieve the
technical milestones on the road to a hydrogen economy.
We discussed the challenges to be faced and how we believed they
could be met. We said that achieving a hydrogen-based economy would
require a combination of technological breakthroughs, market
acceptance, and large investments in a national hydrogen energy
infrastructure. We knew that success would not happen overnight, or
even over years, but rather over decades. We knew it would be a long-
term process that would phase hydrogen in as the technologies and their
markets are ready, and that success would require that the technologies
to utilize hydrogen fuel and the availability of hydrogen fuel occur
simultaneously.
Also at that hearing, I presented the following timeline:
As you can see, the timeline shows that we won't realize the full
potential of a hydrogen economy for several decades. Phase I technology
development will lead to a commercialization decision by industry only
if government-sponsored and private research is successful in meeting
customer requirements and in establishing a business case that can
convince industry to invest. If industry makes a positive
commercialization decision, we will be ready to take the next steps
toward realizing the full potential of the hydrogen economy, a process
that will evolve over several decades, and may include policy options
other than research to catalyze infrastructure investment. The impact
of hydrogen fuel cell vehicles will depend on how quickly the market
introduces the new vehicles, the availability of production and
delivery infrastructure, and the time it takes for a new fleet of
hydrogen vehicles to replace the existing inventory of conventional
vehicles.
Our focus today is the research and development to overcome the
technical barriers associated with hydrogen and fuel cell
technologies--including lowering the cost of hydrogen production and
fuel cell technologies, improving hydrogen storage systems, and
developing codes and standards for hydrogen handling and use. The
Department has requested $227 million in its FY 2005 budget request to
support the Hydrogen Fuel Initiative. In addition, the Department of
Transportation requested about $1.0 million.
Over the past year our progress has increased confidence that the
2015 goal is realistic and attainable. For example:
Significant technical progress has been made in
reducing the cost of hydrogen production. We have verified the
ability to produce hydrogen from natural gas at $3.60 per
gallon of gasoline equivalent from an integrated hydrogen
refueling station that co-produces electricity from a
stationary fuel cell. This meets our 2003 interim milestone.
In the very near future, we will announce selections
from two major competitive solicitations. The first is our
hydrogen storage ``Grand Challenge.'' Novel approaches, beyond
pressurized tanks, are needed in the long term to provide the
greater than 300 mile range that consumers expect. Our new
hydrogen storage selections have established three ``Centers of
Excellence'' where each center is composed of a national lab
teamed with seven or eight universities to research novel
materials for hydrogen storage.
The second major solicitation is for our national
fuel cell vehicle and hydrogen infrastructure ``learning''
demonstration. This ``demonstration'' is an extension of our
research and will provide us the necessary data to focus our
research on the most difficult technical barriers and safety
issues, as well as help us identify vehicle-infrastructure
interface issues that need to be worked out collectively by the
government, automotive manufacturers and energy industry.
In the coming months, we will also be announcing
winners to our hydrogen production and delivery research
solicitation.
To track the progress of our research, the Department and its
industry partners jointly develop performance-based technical and cost
milestones that reflect customer requirements and the business case
needed for industry to invest. Our newly released Hydrogen Posture Plan
details the Department's overall integrated plan, identifies key
technology milestones, and includes timelines that provide clear and
quantifiable measures to track and demonstrate progress. We do not
believe that these milestones are unrealistic. They are, however,
intentionally aggressive so that we ``set the bar high'' to try to
stimulate revolutionary ideas in research. Having said that, we plan to
evaluate all of the milestones based on the National Academies' report.
Indeed, the Hydrogen Posture Plan already takes into account many of
the report's comments.
Our focus on hydrogen fuel cell vehicles does not come at the
expense of support for conservation and gasoline hybrid vehicles as
short-term strategy for reducing oil use, criteria pollutants and
greenhouse gas emissions. Under the FreedomCAR Partnership, in addition
to research on fuel cells, the Department requests $91 million to
continue research to develop advanced, affordable hybrid component
technologies. These technologies include energy storage devices, power
electronics, lightweight materials, advanced combustion engines, and
other technologies that have application for the gasoline hybrids of
today, the fuel cell vehicles of tomorrow, or in many cases, both. The
Department continues to implement robust programs in support of wind
turbines, solar photovoltaic technology, Generation IV nuclear power
systems, and solid state lighting, and many other energy technology
program areas.
However, as the National Academies' report notes, it will take a
revolutionary approach like hydrogen fuel cells to provide the
fundamental change that will allow us to be completely independent of
oil and free of carbon in the tailpipe. Incremental changes available
in the near term will not overcome the increasing demands for a limited
supply of oil.
This is demonstrated in the chart titled ``Oil Use by Light Duty
Vehicles.'' The National Academies' National Research Council report
shows a case where gasoline hybrid electric vehicles (HEV), the ``NRC
HEV Case,'' penetrate the market. As you can see, under this scenario,
petroleum use stays constant at best and we don't reduce our
vulnerabilities associated with importing foreign oil since domestic
production stays constant. When you consider the growth of petroleum
use around the world, especially in developing countries, there will be
an even greater demand for limited supplies.
Fuel cell vehicle (FCV) market penetration scenarios developed by
DOE and the National Academies' National Research Council (NRC) are
similar. As shown in the chart, the petroleum use from the ``DOE FCV''
case is very similar to the ``NRC HEV + FCV'' case. This analysis also
shows that in the long-term, increased fuel economy alone will not even
reduce the amount of oil use compared to today's level. Simply put, if
we are going to significantly reduce our dependence on foreign oil, we
need to substitute for petroleum.
Response to National Academies Report
DOE fully recognized the complexity and uncertainties involved in a
transition to a hydrogen economy, and requested the National Academies
to conduct an independent review of our hydrogen production and
infrastructure options. We requested assistance in two major areas: (1)
assessing strategies for hydrogen production from domestic resources in
near-, mid-, and long-term; and (2) reviewing the Department's current
research plans and making recommendations on research strategies.
Last April, the committee provided us with four interim
recommendations, which we acted upon immediately. They are:
1. The Department should establish an independent systems
engineering and analysis group. In response to this
recommendation we conducted a nationwide recruiting effort and
hired a lead systems integrator. The systems integrator has
been tasked to develop a model to assess the impact of various
technology pathways, identify key cost drivers and
technological gaps, and assist in prioritization of R&D
directions. A portion of the increase in the FY 2005 budget
request will be used to create this capability.
2. The Department should give exploratory and fundamental
research additional budgetary emphasis. As a result of this
recommendation, the DOE Office of Science is now directly
involved in supporting the President's Hydrogen Fuel
Initiative. Last May, the Office of Science hosted a workshop
to identify the basic research needs for a hydrogen economy.
The Office of Science created and filled a position for Senior
Advisor for Applied Energy Programs. This person has a broad
knowledge of the Science R&D programs at the National
Laboratories, and helps the applied programs in their search
for technological breakthroughs. The Department's FY 2005
budget request includes $29 million for the Office of Science
to conduct basic research in hydrogen production, storage and
use.
3. DOE should make a significant effort to address safety
issues. In response, we developed guidelines for safety plans
to be carried out on all projects and established a safety
review panel to evaluate implementation of these plans. In
addition, the Department's FY 2005 budget request includes a
three-fold increase in funding for safety-related research. We
have also worked closely with the Department of Transportation,
the National Institute of Science and Technology, and other
organizations to define roles and responsibilities for the
research and development of hydrogen codes and standards to
enable safe use of hydrogen.
4. DOE should integrate hydrogen R&D efforts across the
applied energy programs, the Office of Science, and appropriate
industry partners. The Department's Hydrogen Posture Plan
integrates the hydrogen activities supporting the President's
Hydrogen Fuel Initiative across the renewable energy, fossil
energy, science, and nuclear energy offices. This plan lays the
foundation for a coordinated response to the President's goal
for accelerated research on critical path hydrogen and fuel
cell technologies. We have also expanded our existing
FreedomCAR Partnership to include major energy companies
(ExxonMobil, ConocoPhillips, ChevronTexaco, BP and Shell) along
with all three major U.S. auto manufacturers.
The final report of the committee presented us with two main
themes:
Theme 1: There should be a shift away from some development areas
towards more exploratory work.
The Department has already begun shifting towards more exploratory
research. A good example is in the hydrogen storage area, where we are
establishing three ``Centers of Excellence'' led by national
laboratories along with multiple university and industry partners. This
could be a model for ``expert'' centers focusing on other priority
research areas such as fuel cell costs and durability, distributed
hydrogen production costs and efficiency, systems analysis for hydrogen
delivery, and renewable hydrogen production methods such as
photobiological, photo-electrochemical (direct solar conversion) and
thermochemical (splitting water with heat processes).
The Department's mix of funding according to OMB circular A-11 for
the FY 2005 budget request is as follows:
This mix reflects our shift towards more exploratory R&D in the
hydrogen storage area. We are currently evaluating our fuel cell cost
and durability research to see if more exploratory R&D is appropriate.
I want to caution everyone that ``exploratory'' R&D is not synonymous
with ``basic'' R&D. We believe the committee is recommending that we
shift away from some development work that industry is capable of
doing.
Theme 2: The hydrogen transition may best be accomplished through
distributed production at fueling sites, from natural gas reforming or
water electrolysis from wind or solar energy. The committee recommends
increased R&D investments on these distributed hydrogen technologies,
which will supply hydrogen for the early transitional period, and
suggests allowing the long-term hydrogen economy to evolve.
Based on this recommendation, the Department will increase its
focus on exploratory research to reduce costs and increase efficiency
of water electrolysis and distributed natural gas reforming. In this
recommendation, we believe the National Academies' committee is telling
us not to over manage the long term, that the longer-term hydrogen
economy should ``evolve'' through greater emphasis on breakthroughs in
technologies with longer time horizons for commercial application, such
as carbon capture and sequestration to enable coal as a long-term
resource, photoelectrochemical, photobiological, and thermochemical
methods.
In keeping with this recommendation, the Office of Science is now
established as a direct participant in the President's initiative and
we are directing our applied research into more exploratory
technologies. As mentioned earlier, our hydrogen storage ``Grand
Challenge'' will create three Centers of Excellence involving federal
laboratories, universities, and private industry. We agree with the
need to support exploratory research and will shift our program
activities to a more basic and exploratory nature, as appropriate.
Response to American Physical Society Report
The American Physical Society report on hydrogen calls for more
spending on basic research and contends that demonstrations are
premature. On the second part of this recommendation, DOE along with
its industry partners believe there is a clear need for such
``learning'' demonstrations. These demonstrations serve as extensions
of our research, and are aimed at obtaining performance and durability
data in real world environments. I want to stress that these are not
demonstrations geared toward commercialization. There is no formula
that can tell us that we have achieved a certain percentage of our
target and that it is now time to conduct a demonstration to close the
final gap. At this stage in the development, technology costs are
reduced through research breakthroughs in materials, performance, and
manufacturing technology, not ``commercial'' demonstrations.
Learning demonstrations, however, will provide improved
understanding of the impact of various climatic conditions on fuel cell
performance and durability. Such data are crucial to resolving system
barriers such as water and heat management within the fuel cell. At the
conclusion of the five-year demonstration program, the pre-established
targets of 2,000 hours durability, 250 mile range and $3.00 per gallon
gasoline equivalent are to be met by industry. This demonstration
effort will give us the statistical evidence that adequate progress is
being made to meet the 2015 criteria of 5,000 hours durability, 300
mile range and $1.50-$2.00 per gallon gasoline equivalent. These
demonstrations will provide accelerated data that we will need to
refocus our future R&D, and will provide the hard data needed to make
difficult decisions should we experience a lack of research progress.
In a hydrogen economy, we will need multiple and complex interfaces
among production, delivery, storage, conversion and end-use. Auto
manufacturers, energy companies, and component suppliers will need to
work together over the next several years to resolve such issues as the
vehicle-infrastructure refueling interfaces. If we are going to make
the huge transformation to a hydrogen energy system, it will be private
companies, not the government, to make the investment and build the
automotive manufacturing infrastructure and hydrogen production and
delivery infrastructure. This learning demonstration will reveal
potential solutions to overcoming technical and economic hurdles to
building infrastructure.
The learning demonstration will also reveal potential safety issues
and open a door to cooperation with local jurisdictions on uniform
codes and standards. In summary, we believe that limited learning
demonstrations, utilizing less than 15 percent of the overall hydrogen
program budget and with industry cost-sharing at a 1:1 ratio, will
provide us with the practical experience and critical data to ensure
that our applied and exploratory research efforts are focused on the
right problems.
Conclusion
Mr. Chairman, all the panelists here today will agree that
achieving the vision of the hydrogen energy future is a great
challenge. It will require careful planning and coordination, public
education, technology development, and substantial public and private
investments. It will require a broad political consensus and a
bipartisan approach. Most of all, it will take leadership and resolve.
By being bold and innovative, we can change the way we do business here
in America; we can change our dependence upon foreign sources of
energy; we can help with the quality of the air; and we can make a
fundamental difference for the future of our children. This committee
in particular has been instrumental in providing that kind of
leadership over the years, and we look forward to continuing this
dialogue in the months and years ahead.
We at the Department of Energy welcome the challenge and
opportunity to play a vital role in this nation's energy future and to
support our national security in such a fundamental way. This completes
my prepared statement. I would be happy to answer any questions you may
have.
Biography for David Garman
David Garman was nominated by President George W. Bush to serve as
Assistant Secretary on April 30, 2001 and was confirmed unanimously by
the United States Senate on May 25, 2001.
Assistant Secretary Garman leads the Office of Energy Efficiency
and Renewable Energy (EERE) comprised of over 500 federal employees in
Washington, DC and six regional offices, supported by thousands of
federal contractors both in and outside the National Laboratories.
EERE's $1.2 billion technology portfolio is the largest energy
research, development, demonstration and deployment portfolio at the
Department of Energy.
Assistant Secretary Garman was instrumental in the development of
the FreedomCAR cooperative automotive research partnership and the
President's Hydrogen Fuel Initiative. In recognition of his role, he
was awarded the National Hydrogen Association's 2002 Meritorious
Service Award, and the Electric Drive Vehicle Association's 2003 ``E-
Visionary'' Award. Concurrent with his duties as Assistant Secretary,
Garman also serves as Chairman of the FreedomCAR Executive Steering
Committee and as Chairman of the Steering Committee for the 15-nation
International Partnership for a Hydrogen Economy.
During his tenure at the Department, Mr. Garman has reorganized the
Office of Energy Efficiency and Renewable Energy, replacing an outdated
and fragmented organization with what is arguably the most innovative
business model ever employed in the Federal Government. The new EERE
organization is comprised of fewer management layers, is more agile,
and is focused on results rather than process. The new organization has
been recognized as a success by the White House and the National
Association of Public Administration. In fully implementing the new
business model in accordance with the President's Management Agenda,
Assistant Secretary Garman is continuing his emphasis on increasing
program manager accountability, reducing administrative overhead, and
getting more work performed with each taxpayer dollar.
Prior to joining the Department of Energy, Mr. Garman served in a
variety of positions on the staff of two U.S. Senators and two Senate
Committees during a career spanning nearly 21 years, including service
on the Professional Staff of the Senate Select Committee on
Intelligence and the Senate Committee on Energy and Natural Resources.
Immediately prior to his current position, Mr. Garman was Chief of
Staff to Frank Murkowski then Chairman of the Energy and Natural
Resources Committee, now Governor of Alaska. In addition to his normal
Senate duties, Mr. Garman represented the Senate leadership at
virtually all of the major negotiations under the United Nations
Framework Convention on Climate Change from 1995-2000.
Assistant Secretary Garman has testified before Congress as an
Administration witness on more than twenty-five occasions; and been
featured as a key Administration spokesman on future energy
technologies in print, television and radio. He holds a Bachelor of
Arts in Public Policy from Duke University, and a Master of Science in
Environmental Sciences from the Johns Hopkins University.
Chairman Boehlert. Thank you very much.
And Dr. Ramage, you are up next. And before you start, just
let me say how much we appreciate the outstanding work of the
Academy. And I can't say that often enough. I do appreciate it.
The floor is yours, sir.
Microphone, please.
STATEMENT OF DR. MICHAEL P. RAMAGE, CHAIR, NATIONAL ACADEMY OF
SCIENCES COMMITTEE ON ALTERNATIVES AND STRATEGIES FOR FUTURE
HYDROGEN PRODUCTION AND USE
Dr. Ramage. I am sorry.
Good afternoon, Mr. Chairman. I serve as Chairman of the
National Research Council Committee on Alternatives and
Strategies for Future Hydrogen Production and Use.
In the summer of 2002, the Department of Energy asked the
NRC to examine the technical and policy issues, which must be
addressed to attain the benefits of a hydrogen economy. Our
committee reviewed the current and potential states of
technologies for hydrogen production, distribution, dispensing,
storage, and end use, and then we estimated cost, carbon
dioxide emissions, and energy efficiencies based on that.
We also developed economic models of the technologies and
developed a framework of how hydrogen could transform the U.S.
energy system, and we focused on light-duty transportation. And
based on the above, we reviewed the DOE program and we made
recommendations on R&D strategies and priorities and
directions.
The Committee reached four major conclusions in our
February 2004 report. The first is that a transition to
hydrogen as a major fuel could fundamentally transform the U.S.
energy system, and hydrogen has the potential to replace
essentially all gasoline and virtually all CO2 from
vehicular emissions.
The second, the Committee's analysis shows that there are
significant hurdles on the path to a hydrogen economy. The
hydrogen system must be economic. It must be safe and
appealing, and it must offer energy security and environmental
benefits. For the transportation sector, that means that it is
essential that there is progress in fuel cell development and
also in hydrogen storage, distribution, and production systems.
And success is not certain, and success should not be assumed
to be certain in some activity like this that has such a large
benefit and also some major hurdles in front of it.
The Committee's third major conclusion addresses the
transition to a hydrogen fuel system, which will probably be
lengthy. Since it will be difficult to stimulate investment in
large, centralized hydrogen production and distribution systems
without proven demand, the Committee strongly suggests that the
transition be progressed with small, on-site hydrogen
production systems at the filling station. These distributed
production units could be natural gas reformers. They could be
water electrolyzers. And this type of transition also allows
for the development of new technologies and concepts for the
eventual widespread use of hydrogen.
The Committee's fourth major conclusion addresses how
hydrogen could transform the energy system in the long-term,
significantly reducing the energy imports and CO2.
Switching to hydrogen will require four things. First, is
that hydrogen fuel cells can penetrate the market and fully
penetrate the market, that hydrogen distribution infrastructure
can be developed. Hydrogen can be economically produced from
coal coupled with CO2 sequestration and the
CO2-free hydrogen production technologies can be
developed from renewable sources or nuclear heat.
While the impacts will probably be small for the next 25
years, successful research and development coupled with large
hydrogen and fuel cell investments will result in major impacts
in the longer-term.
And based on our analysis of the hydrogen economy and a
review of the DOE program, the Committee recommended that five
areas of the DOE program receive increased emphasis. And the
first is that breakthrough research in fuel cell vehicle
development, and I emphasize breakthrough research. This is the
DOE program we are talking about. The second is development of
a low-cost, distributed hydrogen generation system. The third
is increased effort in infrastructure analysis and research.
The fourth is an early evaluation of the viability of CO2
sequestration, particularly with its importance to coal. And
the fifth is hydrogen production directly from renewables and
nuclear without going through the step of electricity.
[The prepared statement of Dr. Ramage follows:]
Prepared Statement of Michael P. Ramage
Mr. Chairman and Members of the Committee:
My name is Michael Ramage and I served as Chairman of the National
Research Council Committee on Alternatives and Strategies for Future
Hydrogen Production and Use. The Research Council--known as the NRC--is
the operating arm of the National Academy of Sciences, National Academy
of Engineering, and the Institute of Medicine, chartered by Congress in
1863 to advise the government on matters of science and technology. The
National Research Council appointed the Committee on Alternatives and
Strategies for Future Hydrogen Production and Use in the fall of 2002
to address the complex subject of the ``hydrogen economy.'' In
particular, the committee carried out these tasks:
Assessed the current state of technology for
producing hydrogen from a variety of energy sources;
Made estimates on a consistent basis of current and
future projected costs, carbon dioxide (CO2)
emissions, and energy efficiencies for hydrogen technologies;
Considered scenarios for the potential penetration of
hydrogen into the economy and associated impacts on oil imports
and CO2 gas emissions;
Addressed the problem of how hydrogen might be
distributed, stored, and dispensed to end uses-together with
associated infrastructure issues--with particular emphasis on
light-duty vehicles in the transportation sector;
Reviewed the U.S. Department of Energy's (DOE's)
research, development, and demonstration (RD&D) plan for
hydrogen; and
Made recommendations to the DOE on RD&D, including
directions, priorities, and strategies.
The vision of the hydrogen economy is based on two expectations:
(1) that hydrogen can be produced from domestic energy sources in a
manner that is affordable and environmentally benign, and (2) that
applications using hydrogen--fuel cell vehicles, for example--can gain
market share in competition with the alternatives. To the extent that
these expectations can be met, the United States, and indeed the world,
would benefit from reduced vulnerability to energy disruptions and
improved environmental quality, especially through lower carbon
emissions. However, before this vision can become a reality, many
technical, social, and policy challenges must be overcome. This report
focuses on the steps that should be taken to move toward the hydrogen
vision and to achieve the sought-after benefits. The report focuses
exclusively on hydrogen, although it notes that alternative or
complementary strategies might also serve these same goals well.
The Executive Summary presents the basic conclusions of the
report\1\ and the major recommendations of the committee. The report's
chapters present additional findings and recommendations related to
specific technologies and issues that the committee considered.
---------------------------------------------------------------------------
\1\ The committee's final report--The Hydrogen Economy:
Opportunities, Costs, Barriers, and R&D Needs--was released in
February, 2004 and is available at www.nap.edu.
---------------------------------------------------------------------------
BASIC CONCLUSIONS
As described below, the committee's basic conclusions address four
topics: implications for national goals, priorities for research and
development (R&D), the challenge of transition, and the impacts of
hydrogen-fueled light-duty vehicles on energy security and CO2
emissions.
Implications for National Goals
A transition to hydrogen as a major fuel in the next 50 years could
fundamentally transform the U.S. energy system, creating opportunities
to increase energy security through the use of a variety of domestic
energy sources for hydrogen production while reducing environmental
impacts, including atmospheric CO2 emissions and criteria
pollutants.\2\ In his State of the Union address of January 28, 2003,
President Bush moved energy, and especially hydrogen for vehicles, to
the forefront of the U.S. political and technical debate. The President
noted: ``A simple chemical reaction between hydrogen and oxygen
generates energy, which can be used to power a car producing only
water, not exhaust fumes. With a new national commitment, our
scientists and engineers will overcome obstacles to taking these cars
from laboratory to showroom so that the first car driven by a child
born today could be powered by hydrogen, and pollution-free.'' \3\ This
committee believes that investigating and conducting RD&D activities to
determine whether a hydrogen economy might be realized are important to
the Nation. There is a potential for replacing essentially all gasoline
with hydrogen over the next half century using only domestic resources.
And there is a potential for eliminating almost all CO2 and
criteria pollutants from vehicular emissions. However, there are
currently many barriers to be overcome before that potential can be
realized.
---------------------------------------------------------------------------
\2\ Criteria pollutants are air pollutants (e.g., lead, sulfur
dioxide, and so on) emitted from numerous or diverse stationary or
mobile sources for which National Ambient Air Quality Standards have
been set to protect human health and public welfare.
\3\ Weekly Compilation of Presidential Documents. Volume 39, Number
5. p. 111. Monday, February 3, 2003. Government Printing Office:
Washington, D.C.
---------------------------------------------------------------------------
Of course there are other strategies for reducing oil imports and
CO2 emissions, and thus the DOE should keep a balanced
portfolio of R&D efforts and continue to explore supply-and-demand
alternatives that do not depend upon hydrogen. If battery technology
improved dramatically, for example, all-electric vehicles might become
the preferred alternative. Furthermore, hybrid electric vehicle
technology is commercially available today, and benefits from this
technology can therefore be realized immediately. Fossil-fuel-based or
biomass-based synthetic fuels could also be used in place of gasoline.
Research and Development Priorities
There are major hurdles on the path to achieving the vision of the
hydrogen economy; the path will not be simple or straightforward. Many
of the committee's observations generalize across the entire hydrogen
economy: the hydrogen system must be cost-competitive, it must be safe
and appealing to the consumer, and it would preferably offer advantages
from the perspectives of energy security and CO2 emissions.
Specifically for the transportation sector, dramatic progress in the
development of fuel cells, storage devices, and distribution systems is
especially critical. Widespread success is not certain.
The committee believes that for hydrogen-fueled transportation, the
four most fundamental technological and economic challenges are these:
1. To develop and introduce cost-effective, durable, safe, and
environmentally desirable fuel cell systems and hydrogen
storage systems. Current fuel cell lifetimes are much too short
and fuel cell costs are at least an order of magnitude too
high. An on-board vehicular hydrogen storage system that has an
energy density approaching that of gasoline systems has not
been developed. Thus, the resulting range of vehicles with
existing hydrogen storage systems is much too short.
2. To develop the infrastructure to provide hydrogen for the
light-duty vehicle user. Hydrogen is currently produced in
large quantities at reasonable costs for industrial purposes.
The committee's analysis indicates that at a future, mature
stage of development, hydrogen (H2) can be produced
and used in fuel cell vehicles at reasonable cost. The
challenge, with today's industrial hydrogen as well as
tomorrow's hydrogen is the high cost of distributing H2
to dispersed locations. This challenge is especially severe
during the early years of a transition, when demand is even
more dispersed. The costs of a mature hydrogen pipeline system
would be spread over many users, as the cost of the natural gas
system is today. But the transition is difficult to imagine in
detail. It requires many technological innovations related to
the development of small-scale production units. Also
nontechnical factors such as financing, siting, security,
environmental impact, and the perceived safety of hydrogen
pipelines and dispensing systems will play a significant role.
All of these hurdles must be overcome before there can be
widespread hydrogen use. An initial stage during which hydrogen
is produced at small scale near the small user seems likely. In
this case, production costs for small production units must be
sharply reduced, which may be possible with expanded research.
3. To reduce sharply the costs of hydrogen production from
renewable energy sources, over a time frame of decades.
Tremendous progress has been made in reducing the cost of
making electricity from renewable energy sources. But making
hydrogen from renewable energy through the intermediate step of
making electricity, a premium energy source, requires further
breakthroughs in order to be competitive. Basically, these
technology pathways for hydrogen production make electricity,
which is converted to hydrogen, which is later converted by a
fuel cell back to electricity. These steps add costs and energy
losses that are particularly significant when the hydrogen
competes as a commodity transportation fuel--leading the
committee to believe most current approaches--except possibly
that of wind energy--need to be redirected. The committee
believes that the required cost reductions can be achieved only
by targeted fundamental and exploratory research on hydrogen
production by photobiological, photochemical, and thin-film
solar processes.
4. To capture and store (``sequester'') the carbon dioxide
byproduct of hydrogen production from coal. Coal is a massive
domestic U.S. energy resource that has the potential for
producing cost-competitive hydrogen. However, coal processing
generates large amounts of CO2. In order to reduce
CO2 emissions from coal processing in carbon-
constrained future, massive amounts of CO2 would
have to be captured and safely and reliably sequestered for
hundreds of years. Key to the commercialization of a large-
scale, coal-based hydrogen production option (and also for
natural-gas-based options) is achieving broad public
acceptance, along with additional technical development, for
CO2 sequestration.
For a viable hydrogen transportation system to emerge, all four of
these challenges must be addressed.
The Challenge of Transition
There will likely be a lengthy transition period during which fuel
cell vehicles and hydrogen are not competitive with internal combustion
engine vehicles, including conventional gasoline and diesel fuel
vehicles, and hybrid gasoline electric vehicles. The committee believes
that the transition to a hydrogen fuel system will best be accomplished
initially through distributed production of hydrogen, because
distributed generation avoids many of the substantial infrastructure
barriers faced by centralized generation. Small hydrogen-production
units located at dispensing stations can produce hydrogen through
natural gas reforming or electrolysis. Natural gas pipelines and
electricity transmission and distribution systems already exist; for
distributed generation of hydrogen, these systems would need to be
expanded only moderately in the early years of the transition. During
this transition period, distributed renewable energy (e.g., wind or
solar energy) might provide electricity to onsite hydrogen production
systems, particularly in areas of the country where electricity costs
from wind or solar energy are particularly low. A transition
emphasizing distributed production allows time for the development of
new technologies and concepts capable of potentially overcoming the
challenges facing the widespread use of hydrogen. The distributed
transition approach allows time for the market to develop before too
much fixed investment is set in place. While this approach allows time
for the ultimate hydrogen infrastructure to emerge, the committee
believes that it cannot yet be fully identified and defined.
Impacts of Hydrogen-Fueled Light-Duty Vehicles
Several findings from the committee's analysis (see Chapter 6) show
the impact on the U.S. energy system if successful market penetration
of hydrogen fuel cell vehicles is achieved. In order to analyze these
impacts, the committee posited that fuel cell vehicle technology would
be developed successfully and that hydrogen would be available to fuel
light-duty vehicles (cars and light trucks). These findings are as
follows:
The committee's upper-bound market penetration case
for fuel cell vehicles, premised on hybrid vehicle experience,
assumes that fuel cell vehicles enter the U.S. light-duty
vehicle market in 2015 in competition with conventional and
hybrid electric vehicles, reaching 25 percent of light-duty
vehicle sales around 2027. The demand for hydrogen in about
2027 would be about equal to the current production of nine
million short tons (tons) per year, which would be only a small
fraction of the 110 million tons required for full replacement
of gasoline light-duty vehicles with hydrogen vehicles, posited
to take place in 2050.
If coal, renewable energy, or nuclear energy is used
to produce hydrogen, a transition to a light-duty fleet of
vehicles fueled entirely by hydrogen would reduce total energy
imports by the amount of oil consumption displaced. However, if
natural gas is used to produce hydrogen, and if, on the margin,
natural gas is imported, there would be little if any reduction
in total energy imports, because natural gas for hydrogen would
displace petroleum for gasoline.
CO2 emissions from vehicles can be cut
significantly if the hydrogen is produced entirely from
renewables or nuclear energy, or from fossil fuels with
sequestration of CO2. The use of a combination of
natural gas without sequestration and renewable energy can also
significantly reduce CO2 emissions. However,
emissions of CO2 associated with light-duty vehicles
contribute only a portion of projected CO2
emissions; thus, sharply reducing overall CO2
releases will require carbon reductions in other parts of the
economy, particularly in electricity production.
Overall, although a transition to hydrogen could
greatly transform the U.S. energy system in the long run, the
impacts on oil imports and CO2 emissions are likely
to be minor during the next 25 years. However, thereafter, if
R&D is successful and large investments are made in hydrogen
and fuel cells, the impact on the U.S. energy system could be
great.
MAJOR RECOMMENDATIONS
Systems Analysis of U.S. Energy Options
The U.S. energy system will change in many ways over the next 50
years. Some of the drivers for such change are already recognized,
including at present the geology and geopolitics of fossil fuels and,
perhaps eventually, the rising CO2 concentration in the
atmosphere. Other drivers will emerge from options made available by
new technologies. The U.S. energy system can be expected to continue to
have substantial diversity; one should expect the emergence of neither
a single primary energy source nor a single energy carrier. Moreover,
more-energy-efficient technologies for the household, office, factory,
and vehicle will continue to be developed and introduced into the
energy system. The role of the DOE hydrogen program\4\ in the
restructuring of the overall national energy system will evolve with
time.
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\4\ The words ``hydrogen program'' refer collectively to the
programs concerned with hydrogen production, distribution, and use
within DOE's Office of Energy Efficiency and Renewable Energy, Office
of Fossil Energy, Office of Science, and Office of Nuclear Energy,
Science and Technology. There is no single program with this title.
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To help shape the DOE hydrogen program, the committee sees a
critical role for systems analysis. Systems analysis will be needed
both to coordinate the multiple parallel efforts within the hydrogen
program and to integrate the program within a balanced, overall DOE
national energy R&D effort. Internal coordination must address the many
primary sources from which hydrogen can be produced, the various scales
of production, the options for hydrogen distribution, the crosscutting
challenges of storage and safety, and the hydrogen-using devices.
Integration within the overall DOE effort must address the place of
hydrogen relative to other secondary energy sources--helping, in
particular, to clarify the competition between electricity, liquid-
fuel-based (e.g., cellulosic ethanol), and hydrogen-based
transportation. This is particularly important as clean alternative
fuel internal combustion engines, fuel cells and batteries evolve.
Integration within the overall DOE effort must also address
interactions with end-use energy efficiency, as represented, for
example, by high-fuel-economy options such as hybrid vehicles.
Implications of safety, security, and environmental concerns will need
to be better understood. So will issues of timing and sequencing:
depending on the details of system design, a hydrogen transportation
system initially based on distributed hydrogen production, for example,
might or might not easily evolve into a centralized system as density
of use increases.
Recommendation ES-1. The Department of Energy should continue to
develop its hydrogen initiative as a potential long-term contributor to
improving U.S. energy security and environmental protection. The
program plan should be reviewed and updated regularly to reflect
progress, potential synergisms within the program, and interactions
with other energy programs and partnerships (e.g., the California Fuel
Cell Partnership). In order to achieve this objective, the committee
recommends that the DOE develop and employ a systems analysis approach
to understanding full costs, defining options, evaluating research
results, and helping balance its hydrogen program for the short,
medium, and long term. Such an approach should be implemented for all
U.S. energy options, not only for hydrogen.
As part of its systems analysis, the DOE should map out and
evaluate a transition plan consistent with developing the
infrastructure and hydrogen resources necessary to support the
committee's hydrogen vehicle penetration scenario or another similar
demand scenario. The DOE should estimate what levels of investment over
time are required--and in which program and project areas--in order to
achieve a significant reduction in carbon dioxide emissions from
passenger vehicles by mid-century.
Fuel Cell Vehicle Technology
The committee observes that the Federal Government has been active
in fuel cell research for roughly 40 years, while proton exchange
membrane (PEM) fuel cells applied to hydrogen vehicle systems are a
relatively recent development (as of the late 1980s). In spite of
substantial R&D spending by the DOE and industry, costs are still a
factor of 10 to 20 times too expensive, are short of required
durability, and energy efficiency is still too low for light-duty-
vehicle applications. Accordingly, the challenges of developing PEM
fuel cells for automotive applications are large, and the solutions to
overcoming these challenges are uncertain.
The committee estimates that the fuel cell system, including on-
board storage of hydrogen, will have to decrease in cost to less than
$100 per kilowatt (kW)\5\ before fuel cell vehicles (FCVs) become a
plausible commercial option, and it will take at least a decade for
this to happen. In particular, if the cost of the fuel cell system for
light-duty vehicles does not eventually decrease to the $50/kW range,
fuel cells will not propel the hydrogen economy without some regulatory
mandate or incentive.
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\5\ Cost includes fuel cell module, precious metals, fuel
processor, compressed hydrogen storage, balance of plant, and assembly,
labor and depreciation.
---------------------------------------------------------------------------
Automakers have demonstrated FCVs in which hydrogen is stored on
board in different ways, primarily as high-pressure compressed gas or
as a cryogenic liquid. At the current state of development, both of
these options have serious shortcomings that are likely to preclude
their long-term commercial viability. New solutions are needed in order
to lead to vehicles that have at least a 300 mile driving range; are
compact, lightweight, and inexpensive; and that meet future safety
standards.
Given the current state of knowledge with respect to fuel cell
durability, on-board storage systems, and existing component costs, the
committee believes that the near-term DOE milestones for FCVs are
unrealistically aggressive.
Recommendation ES-2. 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.
Infrastructure
A nationwide, high-quality, safe, and efficient hydrogen
infrastructure will be required in order for hydrogen to be used widely
in the consumer sector. While it will be many years before hydrogen use
is significant enough to justify an integrated national
infrastructure--as much as two decades in the scenario posited by the
committee--regional infrastructures could evolve sooner. The
relationship between hydrogen production, delivery, and dispensing is
very complex, even for regional infrastructures, as it depends on many
variables associated with logistics systems and on many public and
private entities. Codes and standards for infrastructure development
could be a significant deterrent to hydrogen advancement if not
established well ahead of the hydrogen market. Similarly, since
resilience to terrorist attack has become a major performance criterion
for any infrastructure system, the design of future hydrogen
infrastructure systems may need to consider protection against such
risks.
In the area of infrastructure and delivery there seem to be
significant opportunities for making major improvements. The DOE does
not yet have a strong program on hydrogen infrastructures. DOE
leadership is critical, because the current incentives for companies to
make early investments in hydrogen infrastructure are relatively weak.
Recommendation ES-3a. The Department of Energy program in
infrastructure requires greater emphasis and support. The Department of
Energy should strive to create better linkages between its seemingly
disconnected programs in large-scale and small-scale hydrogen
production. The hydrogen infrastructure program should address issues
such as storage requirements, hydrogen purity, pipeline materials,
compressors, leak detection, and permitting, with the objective of
clarifying the conditions under which large-scale and small-scale
hydrogen production will become competitive, complementary, or
independent. The logistics of interconnecting hydrogen production and
end use are daunting, and all current methods of hydrogen delivery have
poor energy-efficiency characteristics and difficult logistics.
Accordingly, the committee believes exploratory research focused on new
concepts for hydrogen delivery requires additional funding. The
committee recognizes that there is little understanding of future
logistics systems and new concepts for hydrogen delivery--thus making a
systems approach very important.
Recommendation ES-3b. The DOE should accelerate work on codes and
standards and on permitting, addressing head-on the difficulties of
working across existing and emerging hydrogen standards in cities,
counties, states, and the Nation.
Transition
The transition to a hydrogen economy involves challenges that
cannot be overcome by research and development and demonstrations
alone. Unresolved issues of policy development, infrastructure
development, and safety will slow the penetration of hydrogen into the
market even if the technical hurdles of production cost and energy
efficiency are overcome. Significant industry investments in advance of
market forces will not be made unless government creates a business
environment that reflects societal priorities with respect to
greenhouse gas emissions and oil imports.
Recommendation ES-4. The policy analysis capability of the Department
of Energy with respect to the hydrogen economy should be strengthened,
and the role of government in supporting and facilitating industry
investments to help bring about a transition to a hydrogen economy
needs to be better understood.
The committee believes that a hydrogen economy will not result from
a straightforward replacement of the present fossil-fuel-based economy.
There are great uncertainties surrounding a transition period, because
many innovations and technological breakthroughs will be required to
address the costs, and energy-efficiency, distribution and nontechnical
issues. The hydrogen fuel for the very early transitional period,
before distributed generation takes hold, would probably be supplied in
the form of pressurized or liquefied molecular hydrogen, trucked from
existing, centralized production facilities. But, as volume grows, such
an approach may be judged too expensive and/or too hazardous. It seems
likely that, in the next 10 to 30 years, hydrogen produced in
distributed rather than centralized facilities will dominate.
Distributed production of hydrogen seems most likely to be done with
small-scale natural gas reformers or by electrolysis of water; however,
new concepts in distributed production could be developed over this
time period.
Recommendation ES-5. Distributed hydrogen production systems deserve
increased research and development (R&D) investments by the Department
of Energy. Increased R&D efforts and accelerated program timing could
decrease the cost and increase the energy efficiency of small-scale
natural gas reformers and water electrolysis systems. In addition, a
program should be initiated to develop new concepts in distributed
hydrogen production systems that have the potential to compete--in
cost, energy efficiency, and safety--with centralized systems. As this
program develops new concepts bearing on the safety of local hydrogen
storage and delivery systems, it may be possible to apply these
concepts in large-scale hydrogen generation systems as well.
Safety
Safety will be a major issue from the standpoint of
commercialization of hydrogen-powered vehicles. Much evidence suggests
that hydrogen can be manufactured and used in professionally managed
systems with acceptable safety, but experts differ markedly in their
views of the safety of hydrogen in a consumer-centered transportation
system. A particularly salient and under-explored issue is that of
leakage in enclosed structures, such as garages in homes and commercial
establishments. Hydrogen safety, from both a technological and a
societal perspective, will be one of the major hurdles that must be
overcome in order to achieve the hydrogen economy.
Recommendation ES-6. The committee believes that the Department of
Energy program in safety is well planned and should be a priority.
However, the committee emphasizes the following:
Safety policy goals should be proposed and discussed
by Department of Energy with stakeholder groups early in the
hydrogen technology development process.
The Department of Energy should continue its work
with standards development organizations and ensure increased
emphasis on distributed production of hydrogen.
The Department of Energy systems analysis should
specifically include safety, and it should be understood to be
an overriding criterion.
The goal of the physical testing program should be to
resolve safety issues in advance of commercial use.
The Department of Energy's public education program
should continue to focus on hydrogen safety, particularly the
safe use of hydrogen in distributed production and in consumer
environments.
Carbon Dioxide-Free Hydrogen
The long timescale associated with the development of viable
hydrogen fuel cells and hydrogen storage provides a time window for a
more intensive DOE program to develop hydrogen from electrolysis,
which, if economic, has the potential to lead to major reductions in
CO2 emissions and enhanced energy security. The committee
believes that if the cost of fuel cells can be reduced to $50 per
kilowatt (kW), with focused research a corresponding dramatic drop in
the cost of electrolytic cells to electrolyze water can be expected (to
$125/kW). If such a low electrolyzer cost is achieved, the cost of
hydrogen produced by electrolysis will be dominated by the cost of the
electricity, not by the cost of the electrolyzer. Thus, in conjunction
with research to lower the cost of electrolyzers, research focused on
reducing electricity costs from renewable energy and nuclear energy has
the potential to reduce overall hydrogen production costs
substantially.
Recommendation ES-7. The Department of Energy should increase emphasis
on electrolyzer development, with a target of $125 per kilowatt and a
significant increase in efficiency toward a goal of over 70 percent
(lower heating value basis). In such a program, care must be taken to
properly account for the inherent intermittency of wind and solar
energy, which can be a major limitation to their wide-scale use. In
parallel, more aggressive electricity cost targets should be set for
unsubsidized nuclear and renewable energy that might be used directly
to generate electricity. Success in these areas would greatly increase
the potential for carbon dioxide-free hydrogen production.
Carbon Capture and Storage
The DOE's various efforts with respect to hydrogen and fuel cell
technology will benefit from close integration with carbon capture and
storage (sequestration) activities and programs in the Office of Fossil
Energy. If there is an expanded role for hydrogen produced from fossil
fuels in providing energy services, the probability of achieving
substantial reductions in net CO2 emissions through
sequestration will be greatly enhanced through close program
integration. Integration will enable the DOE to identify critical
technologies and research areas that can enable hydrogen production
from fossil fuels with CO2 capture and storage. Close
integration will promote the analysis of overlapping issues such as the
co-capture and co-storage with CO2 of pollutants such as
sulfur produced during hydrogen production.
Many early carbon capture and storage projects will not involve
hydrogen, but rather will involve the capture of the CO2
impurity in natural gas, the capture of CO2 produced at
electric plants, or the capture of CO2 at ammonia and
synfuels plants. All of these routes to capture, however, share carbon
storage as a common component, and carbon storage is the area in which
the most difficult institutional issues and the challenges related to
public acceptance arise.
Recommendation ES-8. The Department of Energy should tighten the
coupling of its efforts on hydrogen and fuel cell technology with the
DOE Office of Fossil Energy's programs on carbon capture and storage
(sequestration). Because of the hydrogen program's large stake in the
successful launching of carbon capture and storage activity, the
hydrogen program should participate in all of the early carbon capture
and storage projects, even those that do not directly involve carbon
capture during hydrogen production. These projects will address the
most difficult institutional issues and the challenges related to
issues of public acceptance, which have the potential of delaying the
introduction of hydrogen in the marketplace.
The Department of Energy's Hydrogen Research, Development and
Demonstration Plan
As part of its effort, the committee reviewed the DOE's draft
``Hydrogen, Fuel Cells & Infrastructure Technologies Program: Multi-
Year Research, Development and Demonstration Plan,'' (DOE, 2003b) dated
June 3, 2003. The committee's deliberations focused only on the
hydrogen production and demand portion of the overall DOE plan. For
example, while the committee makes recommendations on the use of
renewable energy for hydrogen production, it did not review the entire
DOE renewables program in depth. The committee is impressed by how well
the hydrogen program has progressed. From its analysis, the committee
makes two overall observations about the program:
First, the plan is focused primarily on the
activities in the Office of Hydrogen, Fuel Cells and
Infrastructure Technologies Program within the Office of Energy
Efficiency & Renewable Energy, and on some activities in the
Office of Fossil Energy. The activities related to hydrogen in
the Office of Nuclear Energy, Science and Technology, and in
the Office of Science, as well as activities related to carbon
capture and storage in the Office of Fossil Energy, are
important, but they are mentioned only casually in the plan.
The development of an overall DOE program will require better
integration across all DOE programs.
Second, the plan's priorities are unclear, as they
are lost within the myriad of activities that are proposed. A
general budget is contained in the Appendix for the plan, but
the plan provides no dollar numbers at the project level, even
for existing projects/programs. The committee found it
difficult to judge the priorities and the go/no-go decision
points for each of the R&D areas.
Recommendation ES-9. The Department of Energy should continue to
develop its hydrogen Research, Development, and Demonstration (RD&D)
Plan to improve the integration and balance of activities within the
Office of Energy Efficiency and Renewable Energy; the Office of Fossil
Energy (including programs related to carbon sequestration); the Office
of Nuclear Energy, Science, and Technology; and the Office of Science.
The committee believes that, overall, the production, distribution, and
dispensing portion of the program is probably underfunded, particularly
because a significant fraction of appropriated funds is already
earmarked. The committee understands that of the $78 million
appropriated for hydrogen technology for FY 2004 in the Energy and
Water appropriations bill (Pub. Law 108-137), $37 million is earmarked
for activities that will not particularly advance the hydrogen
initiative. The committee also believes that the hydrogen program, in
an attempt to meet the extreme challenges set by senior government and
DOE leaders, has tried to establish RD&D activities in too many areas,
creating a very diverse, somewhat unfocused program. Thus, prioritizing
the efforts both within and across program areas, establishing
milestones and go/no-go decisions, and adjusting the program on the
basis of results are all extremely important in a program with so many
challenges. This approach will also help determine when it is
appropriate to take a program to the demonstration stage. And finally,
the committee believes that the probability of success in bringing the
United States to a hydrogen economy will be greatly increased by
partnering with a broader range of academic and industrial
organizations--possibly including an international focus\6\--and by
establishing an independent program review process and board.
---------------------------------------------------------------------------
\6\ Secretary Abraham, joined by Ministers representing 14 nations
and the European Commission, signed an agreement on November 20, 2003
to formally establish the International Partnership for the Hydrogen
Economy.
Recommendation ES-10. There should be a shift in the hydrogen program
away from some development areas and toward exploratory work--as has
been done in the area of hydrogen storage. A hydrogen economy will
require a number of technological and conceptual breakthroughs. The
Department of Energy program calls for increased funding in some
important exploratory research areas such as hydrogen storage and
photoelectrochemical hydrogen production. However, the committee
believes that much more exploratory research is needed. Other areas
likely to benefit from an increased emphasis on exploratory research
include delivery systems, pipeline materials, electrolysis, and
materials science for many applications. The execution of such changes
in emphasis would be facilitated by the establishment of DOE-sponsored
academic energy research centers. These centers should focus on
interdisciplinary areas of new science and engineering--such as
materials research into nanostructures, and modeling for materials
design--in which there are opportunities for breakthrough solutions to
---------------------------------------------------------------------------
energy issues.
Recommendation ES-11. As a framework for recommending and prioritizing
the Department of Energy program, the committee considered the
following:
Technologies that could significantly impact U.S. energy
security and carbon dioxide emissions,
The timescale for the evolution of the hydrogen economy,
Technology developments needed for both the transition period
and steady state,
Externalities that would decelerate technology
implementation, and
The comparative advantage of the DOE in research and
development of technologies at the pre-competitive stage.
The committee recommends that the following areas receive increased
emphasis:
Fuel cell vehicle development. Increase research and
development (R&D) to facilitate breakthroughs in fuel cell
costs and in durability of fuel cell materials, as well as
breakthroughs in on-board hydrogen storage systems;
Distributed hydrogen generation. Increase R&D in
small-scale natural gas reforming, electrolysis, and new
concepts for distributed hydrogen production systems;
Infrastructure analysis. Accelerate and increase
efforts in systems modeling and analysis for hydrogen delivery,
with the objective of developing options and helping guide R&D
in large-scale infrastructure development;
Carbon sequestration and FutureGen. Accelerate
development and early evaluation of the viability of carbon
capture and storage (sequestration) on a large scale because of
its implications for the long-term use of coal for hydrogen
production. Continue the FutureGen Project as a high-priority
task;
Carbon dioxide free-energy technologies. Increase
emphasis on the development of wind-energy-to-hydrogen as an
important technology for the hydrogen transition period and
potentially for the longer-term. Increase exploratory and
fundamental research on hydrogen production by photobiological,
photoelectrochemical, thin-film solar, and nuclear heat
processes.
COMMITTEE ON ALTERNATIVES AND STRATEGIES FOR FUTURE HYDROGEN PRODUCTION
AND USE
MICHAEL P. RAMAGE, NAE,\7\ Chair, ExxonMobil Research and Engineering
Company (retired), Moorestown, New Jersey
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\7\ NAE = member, National Academy of Engineering.
RAKESH AGRAWAL, NAE, Air Products and Chemicals, Inc., Allentown,
---------------------------------------------------------------------------
Pennsylvania
DAVID L. BODDE, University of Missouri, Kansas City
ROBERT EPPERLY, Consultant, Mountain View, California
ANTONIA V. HERZOG, Natural Resources Defense Council, Washington, D.C.
ROBERT L. HIRSCH, Scientific Applications International Corporation,
Alexandria, Virginia
MUJID S. KAZIMI, Massachusetts Institute of Technology, Cambridge
ALEXANDER MacLACHLAN, NAE, E.I. du Pont de Nemours & Company (retired),
Wilmington, Delaware
GENE NEMANICH, Independent Consultant, Sugar Land, Texas
WILLIAM F. POWERS, NAE, Ford Motor Company (retired), Ann Arbor,
Michigan
MAXINE L. SAVITZ, NAE, Consultant (retired, Honeywell), Los Angeles,
California
WALTER W. (CHIP) SCHROEDER, Proton Energy Systems, Inc., Wallingford,
Connecticut
ROBERT H. SOCOLOW, Princeton University, Princeton, New Jersey
DANIEL SPERLING, University of California, Davis
ALFRED M. SPORMANN, Stanford University, Stanford, California
JAMES L. SWEENEY, Stanford University, Stanford, California
Project Staff
Board on Energy and Environmental Systems (BEES)
MARTIN OFFUTT, Study Director
ALAN CRANE, Senior Program Officer
JAMES J. ZUCCHETTO, Director, BEES
PANOLA GOLSON, Senior Project Assistant
NAE Program Office
JACK FRITZ, Senior Program Officer
Consultants
Dale Simbeck, SFA Pacific Corporation
Elaine Chang, SFA Pacific Corporation
Biography for Michael P. Ramage
Michael Ramage was born on July 29, 1943, in Washington, Indiana.
He received a B.S. degree in 1966, a M.S. degree in 1969, and a Ph.D.
in 1971, all in Chemical Engineering from Purdue University. He retired
as Executive Vice President of ExxonMobil Research and Engineering
Company in 2001. Mr. Ramage was formerly Chief Technology Officer of
Mobil Oil Corporation and President, Mobil Technology Company. He was
also member of the Board of Directors and Executive Committee of Mobil
Oil Corporation.
Ramage joined the Mobil Research and Development Corporation in
1971, working at the Paulsboro Research Laboratory, where he held
various technical and managerial positions until becoming Manager of
Process Development for Mobil Chemical Company in 1980. He was named
Manager of Planning Coordination for Mobil Chemical Company's domestic
and international operations in 1981. He returned to the Paulsboro
Research Laboratory in 1982 as Manager of the Process Research,
Development, and Technical Service Division. He was named Vice
President of Planning for Mobil Research and Development Corporation in
1987. From 1989-1992 he managed Mobil's Dallas Research Laboratory,
which was responsible for Mobil's geoscience and petroleum engineering
research efforts. In 1992, he led a team that created Mobil Exploration
and Producing Technical Center, and was appointed General Manager. In
this capacity, he was responsible for research, development, and
technical support for Mobil's worldwide exploration and producing
activities. In 1994, he was appointed Vice President of Engineering for
Mobil and was responsible for leading the Corporation's worldwide
Engineering Organization. In 1995, Mr. Ramage again led a major
corporate reorganization effort. The result was the creation of Mobil
Technology Company, a worldwide organization of over 2000 people
responsible for research, engineering, technical service, and capital
project management for all Mobil business units. In September 1995, he
was appointed Chief Technology Office and President, Mobil Technology
Company. In 1998, he was appointed to the Board of Directors and
Executive Committee of Mobil Oil Corporation. In 1999, he was a member
of the Exxon Mobil merger transition team and was later appointed
Executive Vice President, ExxonMobil Research and Engineering Company.
Mr. Ramage retired from ExxonMobil in 2002 and continues to serve as a
liaison between the company and outside research, academic, and
professional organizations.
Ramage did extensive research in reaction engineering and catalysis
in his early career at Mobil and was awarded six U.S. patents, one New
Zealand patent, and has thirteen publications for work related to those
areas.
Mr. Ramage is a member of the Board of Directors for the American
Institute of Chemical Engineers, the International Symposium on
Chemical Reaction Engineering, and Junior Achievement of Philadelphia.
He serves on the Chemical Engineering Visiting Committee at Purdue
University. In the past, he served on Advisory Boards at Stanford,
University of California, Berkeley, University of Texas at Austin, and
The Construction Industry Institute. Mr. Ramage is also a member of the
National Academy of Engineering, the NAE Council, and The Government
University Industry Research Roundtable. He received an Honorary Doctor
of Engineering degree from Purdue in 1996.
Dr. Ramage. Mr. Chairman, would you like me to answer the
questions now?
Chairman Boehlert. Yes.
Dr. Ramage. Okay. With regard to the five questions, the
first question regarded the appropriate balance of federal
funds between demonstration and research. This issue was not
directly addressed in our study, but our report does recommend
a shift away from development in some areas, such as biomass
gasification, or more exploratory research in areas such as
direct hydrogen production using photo, biological, and solar
methods.
With regards to your second question on policy analysis,
the DOE must have the capability not only to manage the
technical programs, but also engage in policy discussions
required to move the technology into the market. Policies such
as incentives and government industry actions can impact the
goals and directions of the technical program.
With regard to your third question on market penetration
and our model, the Committee's vision for how light-duty fuel
cell vehicles will enter the U.S. market is plausible, but it
is optimistic. And it is optimistic because it assumes two
things. It assumes first that if--the technical barriers are
overcome and second that the infrastructure barriers are
overcome. If those two things happen, then it becomes plausible
in our mind. Those are the two big areas. And this is the
reason why. One of the major--our report was on the transition
period and the transition period using small scale, at-site
production systems so we can take the infrastructure issue out
of the equation and let that develop over time.
With regard to your fourth question regarding demonstration
programs, this issue also was not addressed in our Committee,
but let me give you some personal perspective. I believe that
the need and timing for demonstrations varies with the type of
technology. And I believe that there are three important
criteria that must be met before technology is ready for
demonstration. And here, I am really talking about large-scale
demonstrations like building coal plants or natural gas plants
to produce hydrogen. There are three areas. The first is the
individual system components of the technology needs to meet
commercial performance, not necessarily cost, but commercial
performance. The second is that the scale of the components, to
a large scale, should be performed one at a time in existing
production facilities, if possible. And I would call these
learning demonstrations. And the third is that a systems
modeling approach must be used to be able, with a mathematical
process, which must be completed, which you can predict
commercial performance, risk, and synergies, those three areas.
With respect to your fifth question, the non-hydrogen
bridge technologies to a hydrogen economy, there are a number
of strategies for reducing oil imports and carbon dioxide
emissions in the short-, medium-, and long-term. The Committee
recommends that the DOE keep a balanced program and that the
systems approach be developed and employed to understand the
trade-offs of all U.S. energy, including hydrogen. And this
also could include, and should include, the analysis of bridge
technologies to get us from one point to the next point.
Mr. Chairman, this concludes my testimony, and I will be
glad to answer any questions that you may have.
Chairman Boehlert. Thank you very much, Dr. Ramage.
Dr. Eisenberger.
STATEMENT OF DR. PETER EISENBERGER, CHAIR, AMERICAN PHYSICAL
SOCIETY, PANEL ON PUBLIC AFFAIRS, ENERGY SUBCOMMITTEE
Dr. Eisenberger. Mr. Chairman, Mr. Gordon, Members of the
Committee, thank you for the invitation to testify today.
I chair the Committee of the American Physical Society
composed of scientists, industrial R&D managers, and energy
economists. We analyzed the Hydrogen Initiative and released
our report on Monday. I request that our report be entered into
the record. [The information referred to appears in Appendix 2:
Additional Material for the Record.]
The bottom line is that major scientific breakthroughs are
required for the Hydrogen Initiative to succeed. We made
several management and funding recommendations that, in our
opinion, will increase the chances for long-term success.
As a starting point, let me say that currently there is
only a very nascent technology base upon which to build a
hydrogen economy. Currently, the U.S. industry provides
hydrogen to meet the needs of a non-transportation sector that
is only about three percent of what is needed for that
transportation sector. Several hydrogen fueling stations are
scheduled to open this year, and several models of hydrogen-
fueled cars have been demonstrated, but none of the current
technologies are competitive options for the consumer.
The most promising hydrogen engine technologies require 10
to 100 times improvements in cost or performance in order to be
competitive. As the Secretary of Energy has stated, current
hydrogen production methods are four times more expensive than
gasoline and significant challenges remain to satisfy both
energy security and environmental objectives of converting to a
hydrogen-based transportation sector. Finally, no material
exists to construct a hydrogen fuel tank that meets the
consumer benchmarks. A new material must be developed.
These are very large performance gaps, and our committee
concluded that incremental improvements to existing
technologies are not sufficient to close all of the gaps. In
particular, hydrogen storage is a potential showstopper.
Simply put, for the Hydrogen Initiative to succeed, major
scientific breakthroughs are needed. This will not be easy. We
can not simply engineer our way to a hydrogen economy, but we
can take several steps now to make success more likely.
Without question, relevant basic science must have greater
emphasis in both the planning and research program of the
Hydrogen Initiative. This is not a controversial conclusion.
The Bush Administration has already taken steps in this
direction, but more must be done. We recommend that: one, the
Hydrogen Technical Advisory Committee include members with
strong research backgrounds who are familiar with key basic
science problems; two, Principal-Investigator basic research
should be increased, and this PI research should be
complemented with competitively-bid, peer-reviewed
multidisciplinary research centers that carry out basic
research in key research areas of production, storage, and use.
These university-based centers should have active industry and
national laboratory participation.
The issue of funding is, of course, a delicate one.
Resources are not unlimited, and members of our Committee
face--members of your committee face difficult decisions.
Several members of our APS Committee have managed large-scale
industrial technology programs. For what it is worth, I and the
members of my committee feel your pain. We have faced difficult
funding decisions in our own careers.
Perhaps the most useful thing I can share with you is the
manner in which industry approaches the difficult funding
decisions you face. The main factors involve technological
competitiveness and readiness, market acceptance, and rate of
penetration. In the case of Congress, one needs to add the
criteria of meeting national security objectives. Our
evaluation is that for hydrogen there are very significant
technology gaps, a lack of an existing infrastructure, and the
inevitable slow rate of penetration for a new energy
technology. This means that one would invest more resources in
research and less, if at all, in development projects. Pilot
projects to demonstrate specific components, like
sequestrations, are more appropriate at this state of the
Hydrogen Initiative. And a very important point is that
premature investments in large demonstration projects have a
history of not only failing but also damaging the overall
objectives.
However, national security objectives may argue for a more
aggressive development plan than industry would follow, though
still premature large-scale demonstration projects are unlikely
to be helpful. In this regard, I will mention one additional
point of view that the industrial managers on our APS Committee
all shared: the need to hedge.
In the event that the timeline for significant hydrogen
vehicle market penetration slips beyond 2020, there could be,
for energy security reasons, a greater need for technologies
that serve as a bridge between the current fossil fuel economy
and any future hydrogen economy. Also the likelihood is
increased that continued investment in research will produce
new discoveries that will identify a far superior way to meet
our needs in the long-term. Increasing the focus on basic
science and engineering that advances such technologies would
serve as a sensible hedge and, at the same time, maintain the
development of technologies that show clear, short-term
promise.
Similarly, the Hydrogen Initiative must not displace
research into promising energy efficiency, renewable energy
areas, and carbon sequestrations. These investments both
complement and contribute to the goals of a hydrogen economy.
And they become an increasingly important means for reducing
CO2 and enhancing our energy security in the event
that the significant technology hurdles for the Initiative are
not met within the proposed timeline.
I hope that our perspective has--our perspective and our
recommendations help you in your oversight, and I am prepared
to answer any questions you might have.
Thank you very much.
[The prepared statement of Dr. Eisenberger follows:]
Prepared Statement of Peter Eisenberger
Mr. Chairman, Mr. Gordon, Members of the Committee, thank you for
the invitation to testify today.
In January 2003, President Bush announced an Initiative to reduce
the Nation's dependence on foreign oil through the production of
hydrogen fuel and a hydrogen-fueled car. The Initiative envisions the
competitive use of hydrogen in commercial transportation by the year
2020.
I chaired a committee of the American Physical Society that
analyzed this Initiative--we released our report on Monday. The bottom
line is that major scientific breakthroughs are required for the
Hydrogen Initiative to succeed. We made several management and funding
recommendations that, in our opinion, will increase the chances for
long-term success.
Before I get into the specifics, let me say a very brief word about
our authors and methodology. Together, the authors and reviewers have
considerable experience in bench science, the management of industrial
technology programs from the laboratory to systems level, management of
government R&D programs, and the economics of energy-commercialization
programs. We did not carry out a new analysis of the scientific
elements of the Hydrogen Initiative. Instead, we distilled the
considerable work that is already available. Our sources included the
DOE ``Report of the Basic Energy Sciences Workshop on Hydrogen
Production, Storage and Use'', the Hydrogen Energy Roadmap, and
numerous presentations by government officials managing the Hydrogen
Initiative, including those for the just released NRC report.
As a starting point, let me say that currently there is only a very
nascent technology base upon which to build a hydrogen economy.
Currently, the U.S. industry provides hydrogen to meet the needs of the
non-transportation sector that is only about three percent of what is
needed for the transportation sector. Several hydrogen-fueling stations
are scheduled to open this year. And several models of hydrogen-fueled
cars have been demonstrated. But, none of the current technologies are
competitive options for the consumer.
The most promising hydrogen-engine technologies require 10 to 100
times improvements in cost or performance in order to be competitive.
As the Secretary of Energy has stated, current hydrogen production
methods are four times more expensive than gasoline, and significant
challenges remain to satisfy both energy security and environmental
objectives of converting to a hydrogen-based transportation sector.
Finally, no material exists to construct a hydrogen fuel tank that
meets the consumer benchmarks. A new material must be developed.
These are very large performance gaps. And our committee concluded
that incremental improvements to existing technologies are not
sufficient to close all the gaps. In particular, hydrogen storage is
the potential show-stopper.
Simply put, for the Hydrogen Initiative to succeed, major
scientific breakthroughs are needed. This will not be easy. We cannot
simply engineer our way to a hydrogen economy. But, we can take several
steps now to make success more likely.
Without question, relevant basic science must have greater emphasis
in both the planning and the research program of the Hydrogen
Initiative. This is not a controversial conclusion. The Bush
Administration has already taken steps in this direction, but, more
must be done. We recommend that:
1. The Hydrogen Technical Advisory Committee include members
with strong research backgrounds who are familiar with the key
basic science problems.
2. Principal-Investigator basic research should be increased.
And this PI research should be complemented with competitively-
bid, peer-reviewed multidisciplinary research centers that
carry out basic research in the key research areas of
production, storage and use. These university-based centers
should have active industry and national laboratory
participation.
The issue of funding is, of course, a delicate one. Resources are
not unlimited and Members of your committee face difficult decisions.
Several members of our APS committee have managed large-scale
industrial technology programs. As for myself, in an earlier life, I
was Senior Director of the Corporate Research Laboratory for Exxon. For
what it's worth, I and the members of my committee, feel your pain. We
have faced difficult funding decisions in our careers.
Perhaps the most useful thing I can share with you is the manner in
which industries approaches these difficult funding decisions. The main
factors involve technological competitiveness and readiness, market
acceptance, and rate of penetration. In the case of Congress, one needs
to add the criteria of meeting national security objectives. Our
evaluation is that for hydrogen there are very significant technology
gaps, a lack of an existing infrastructure and the inevitable slow rate
of penetration for a new energy technology. This means that one would
invest more resources in research and less, if at all, in development
projects. Pilot projects to demonstrate specific components like
sequestration are more appropriate at this stage of the Hydrogen
Initiative. Premature investments in a large demonstration projects
have a history of not only failing but also damaging the overall
objectives.
However, national security objectives may argue for a more
aggressive development plan than industry would follow, though
premature large-scale demonstration projects are unlikely to be
helpful. In this regard, I will mention one additional point of view
that the industrial managers on our APS committee all shared--hedging.
In the event that the timeline for significant hydrogen vehicles
market penetration slips beyond 2020, there could be, for energy
security reasons, a greater need for technologies that serve as a
``bridge'' between the current fossil-fuel economy and any future
hydrogen economy. Also the likelihood is increased that continued
investment in research will produce new discoveries that will identify
a far superior way to meet our needs in the long term. Increasing the
focus on basic science and engineering that advances such technologies
would serve as a sensible hedge and at the same time maintain the
development of technologies that show clear short-term promise.
Similarly, the Hydrogen Initiative must not displace research into
promising energy efficiency and renewable energy areas, and carbon
sequestration. These investments both complement and contribute to the
goals of a hydrogen economy. And, they become increasingly important
means for reducing CO2 and enhancing our energy security in
the event that the significant technology hurdles for the Initiative
are not met within the proposed timeline.
I hope that our perspective and our recommendations help in your
oversight of the Hydrogen Initiative.
Biography for Peter Eisenberger
Peter Eisenberger attended Princeton University from 1959 until
1963 where he received a B.A. in Physics. He graduated in 1967 from
Harvard with a Ph.D. in Applied Physics and remained at Harvard for one
year as a Post-Doctoral Fellow. In 1968, Dr. Eisenberger joined the
staff at Bell Laboratories. From 1974 to 1981, he was a department head
at Bell Laboratories. He was a consulting professor at Stanford
University's Applied Physics Department from 1981 to 1987. He became
actively involved in the growth of National User facilities, including
Chairship of the Advanced Photon Steering Committee and participation
in National Academy of Science (NAS) and Department of Energy (DOE)
studies. In 1981, he joined Exxon Research and Engineering Company as
Director of their Physical Sciences Laboratory. In 1984, he was
appointed Senior Director of their Corporate Research Laboratory. In
1989, he was appointed Professor of Physics and Director of the
Princeton Materials Institute at Princeton University. He is currently
a Professor of Earth and Environmental Sciences at Columbia University,
where form 1996 to 1999 he held the posts of Vice Provost of the Earth
Institute of Columbia University and Director of Lamont-Doherty Earth
Observatory of Columbia University. Dr. Eisenberger is a fellow of both
the American Physical Society and the American Association for the
Advancement of Science. Dr. Eisenberger was one of the authors of the
National Action Plan for Materials Science and Engineering, and was a
member of the Commission on the Future of the National Science
Foundation (NSF). He was chair of the Advisory Committee in the
Mathematical and Physical Sciences Division of the NSF. His recent
activities include Chairman of the Board of the Invention Factory
Science Center, Member of the Board of Trustees for New Jersey's
Inventors Hall of Fame, Director of Associated Institutions for
Materials Science, and organizer of NSF/DOE Conferences, ``Basic
Research Needs for Vehicles of the Future,'' ``Basic Research Needs for
Environmentally Responsive Technologies of the Future,'' ``Organizing
for Research and Development in the 21st Century,'' and ``Basic
Research Needs to Achieve Sustainability: The Carbon Problem.'' More
recently, he has been appointed by Governor Whitman to the New Jersey
Commission on Science and Technology and Co-chair of Flandrau Science
Center Senior Advisory Board at the University of Arizona.
Discussion
Chairman Boehlert. Thank you very much, Mr. Eisenberger.
Mr. Garman, I appreciate the additional money that DOE has
requested for exploratory hydrogen research in the Office of
Science. That is definitely a positive step that demonstrates,
I think, your responsiveness to outside guidance. You say in
your testimony that you are evaluating some additional programs
to see if more money should be shifted to exploratory R&D. On
what basis will you make that decision and are there specific
criteria?
Mr. Garman. This is a very iterative process, Mr. Chairman.
And one of the things that we did early on is share with the
Committee our draft, hydrogen fuel cell infrastructure
technologies program, program plan. This enabled the Committee
to interact with us in some of these areas and was the reason,
I will tell you, that in the President's 2005 budget submission
we did ask for $29 million in the Office of Science to do some
of this more fundamental work. We--there are--and so this is
going to be an iterative process. I don't think there are any
hard and fast rules of thumb about precisely when and how we
will shift funding.
But there is something very important that I think we need
to get out on the table and understand, and it may be the basis
of the Committee's misunderstanding in some of these areas.
Nobody is talking about doing premature technology
demonstrations. And in fact, we find this very report very
useful in helping us to fend that off from those of us--or from
those who are saying, some members in the other body, I might
add, that we are not being aggressive enough and that we need
to go more quickly to larger scale technology demonstrations,
get certain numbers of cars on the road by certain target dates
irrespective of whether the technology, the underlying
technology, is ready. The commercial success has to be clear.
The business case has to be clear.
So I think it is very important to make that point that our
demonstrations, when we say demonstrations or technology
validation activities, we are talking about putting a very
limited number of vehicles on the road that will produce data
that goes right back into the R&D process, including the
exploratory R&D process. We are not talking about building
large facilities. We are not talking about doing large vehicle
demonstrations that are designed to drive unit costs down. We
are talking about learning, very small, limited learning
demonstrations that produce data that go right back into the
R&D process. So there is a lot of agreement on this panel on
that subject, and I think that it is very important to make
that point early on.
Chairman Boehlert. The development of technology should set
the pace then, that is what you are saying?
Mr. Garman. Absolutely. You should--we should not be in a
rush to deploy vehicles either in the context of a large
demonstration or actually trying to force market adoption of a
technology that is not ready.
Chairman Boehlert. Well, do you agree with these experts,
then, that we need to shift some more money to exploratory
research?
Mr. Garman. Exploratory, yes. And this is where we may have
a nomenclature problem, and I want to be very careful. This
program is on a razor's edge. Some would say we need to do more
fundamental and basic science, and of course, we have some
coming at us from the other side saying no, we need to rush to
deploy the technologies we have got today, which would be a
horrible mistake, because it would lock in those technologies
at their current state of development. It would be premature
before codes and standards and the other work that needs to be
done are completed.
So we are on a razor's edge here. We don't want this to
become a basic research program of the kind that government can
work on for 20 or 30 years before it produces results, but we
don't want this also to become an effort where we start to
deploy and push before we are ready. So we are on a razor's
edge.
Chairman Boehlert. Yeah. Yeah. And you always are very
careful. I noticed that. Thank you, and I really appreciate it.
Dr. Ramage and Dr. Eisenberger, let me ask you each in
order, do you think that $29 million for the Office of Science
is enough for the type of program you envision? Dr. Ramage.
Dr. Ramage. Well, may I first tell you exactly what I think
we recommended on this issue, and I think that will help me
answer the question?
We recommended that there were certain areas where there
needs to be increased exploratory research. Hydrogen storage is
one of them, particularly in direct hydrogen production and
other ones, storage is a big issue. And you know, the $29
million and the fact that that has been made, I think, is a
very positive move. I can't tell you if that is the right
amount of money, but I certainly think that is in the right
direction.
May I make another comment, though----
Chairman Boehlert. Sure.
Dr. Ramage [continuing]. On this issue? You know, I have
managed research all of my life, and the worst thing you can do
in a program is have a program that has too much basic research
and you don't have the right balance, which is really what my
first question was. And you really need programs where you have
basic research, development, and learning demonstrations so you
can constantly move your technologies through the programs. And
you can be testing them and learning them at the same time. And
you have to make sure that in your research program you are
actually working on areas where you have major gaps in
knowledge, and storage is one of those areas. But there are
other areas, and we argue for a transition using distributed
production. That is really a development effort. And it is
not--and that effort, we think, is very important, but
developing a small scale, at-site reformers is effort that is
in the development and there are learning activities that are
required to do that.
So the answer to your question is we are very happy, and
the Committee was very happy to see $29 million. But this is
not an issue of basic research versus something else. There is
a continuum of activities that have to take place to keep this
economy moving toward a hydrogen economy. And in the end, a lot
of things that we think will happen, we don't know what they
are today.
Chairman Boehlert. Dr. Eisenberger.
Dr. Eisenberger. In answering the question, let me try to
put this in a frame, which I think is contributing to part of
the confusion. Let us say when President Kennedy committed us
to go to the moon, he had just the need to accomplish the task.
He didn't have to worry about--our country didn't have to worry
about the cost or consumer acceptance of the particular way we
went. And what we have here is a concatenation of both a
national security need and a market need. And we are mixing up,
in some cases, the drivers that would make one want to regard
this as a national security objective with the way you would
prudently address something that ultimately the consumer has to
accept. And as much as the national security wants it, if the
consumer doesn't accept it, it ain't going to happen. And I
think it is in trying to understand which track we are on and
keeping for sure that we know in the bottom line we have to be
on the consumer track that would help us all stay on the same
path.
So I agree with the philosophy stated here in terms of the
need to have this continuum, but my concern is viewing it as
something that ultimately has to make the--meet the market. It
is something that we would normally--I--my instincts, my
judgment, I can't give you a number, because I would have to
spend a lot more time to look into it, but I feel that we are
putting too much of the resources downstream, right in that
continuum that Dr. Ramage talked about, and not enough
upstream, and that since the amount of money that goes into
demonstration projects, in industry you know once you course
the demonstration projects, they are the ones that cost you a
lot of money. All right. They are very expensive. A $1 billion
research program is unimaginable, right? We are talking about
millions, but the demonstration projects are much more costly.
So I would say notionally, I--there is a need to shift more. I
couldn't give you a number. All right. But I can say that I
think there is this confusion between whether we are doing this
ultimately that it has to meet the marketplace or we are doing
it because of national security.
Chairman Boehlert. Secretary Garman wants to----
Mr. Garman. And there is just--again, there is--I think
there is a miscommunication going on here, so I want to try to
correct it before it goes on too far. The $29 million in the
science budget, that is what we are calling basic. That does--
we are doing much more exploratory research and plan to do more
exploratory research. And I think I was negligent in failing
to--partly for reasons of time, to answer the five Committee
questions. But one of those five Committee questions is on
point when you say, you know, using the definitions in OMB
circular A-11, what is your split in the current funding
profile between these different types of research? In basic
research, we are around 13 percent; applied research, which
includes a component of exploratory R&D, about 42.5 percent;
development, 29.2 percent; demonstration, 13.4 percent, and
that constitutes what we have. And the only deployment work we
are doing is a tiny two percent, mainly related to education
for the very long-term.
Chairman Boehlert. Thank you for that clarification.
Mr. Larson.
Mr. Larson. Thank you. Thank you, Mr. Chairman. And I thank
the panelists for being here for your--and for your fine
testimony. And I thank the Chairman again for this hearing that
is important to each and every one of us. It is rarely an
opportunity in my years in government that you get to talk
about a subject matter that embraces energy, the economy, the
environment, and foreign policy all in one breath. And so I
think the dynamic here is extraordinarily important, but never
has there been such a great need, and in my estimation, so
little funding toward that effort. And I think the hard truth
is that if we are going to aggressively pursue a hydrogen
economy, then we have got to aggressively put forward the
funding that we are going to need. And I say that lauding the
Administration in terms of the efforts it has made to date, but
recognizing that even though these efforts are well intended,
it is not nearly the amount of money that I believe is going to
be necessitated if we are serious, in fact, about a number of
the issues that you have raised and a number of the goals that
the Committee has stressed to date.
A couple of questions that I have, and I am wondering with
respect to--Mr. Garman, with respect to this study and the work
of--and your work whether or not there has been any
coordination with the Department of Defense which already has
put forward close to $50 million in studies and in actual
projects.
Mr. Garman. Yes, sir. We have worked with the Department of
Defense both in the context of the stationary fuel cell work
that they do, and we also interfaced with the Department of
Defense in a program that we call Future Truck, which is
looking at larger, heavier transportation. We have done some
fuel cell work with them in that context and will continue to
do so. It is very, very important. Their needs are sometimes a
little different than ours, but we think there are a lot of
avenues for collaboration, and we want to do even more.
Mr. Larson. One of those collaborations I believe, and I
would be interested in the panelists' views on this, is when
you are talking about pilots, it seems to me that as a mode of
transportation that, and you have all pointed out some of the
problematic concerns raised in looking at individual vehicles,
but when you talk about heavyweight vehicles, you mentioned
trucks, I would focus on buses, primarily because of the mode
of transportation, the fact that they are usually barned that
even, the fact that they usually can accommodate some of the
storage issues that were--that have been raised. And also, in
terms of pure pilots and testing, seeing that this ought to be
a clear focus of Department of Energy and Transportation. Would
you respond, all of the panelists?
Dr. Eisenberger. I think it makes--I would also like to
echo in that regard to what Dr. Ramage said. You can't go from
nothing to something. You have got to find ways to ease
yourself into the market to get on the learning curve, to get
things--some value out of it so that provides an economic
motivation for your infrastructure to develop. And I have
thought about it recently----
Mr. Larson. That is a good point. And all of you have
mentioned this with respect to the market, but isn't it also
true that if we look out at our municipalities, as we look out
at our states, as we look at our various schools that every
single one of those schools has to transport kids back and
forth to school via bus. Those plants and facilities all have
to be heated and cooled. They are part of the marketplace, to
be sure, but they are also part of a larger laboratory of
government where, I believe, that we ought to spend a lot of
our focus and emphasis, understanding that it is not the same
as the commercial market. And in fact, as all of you have
pointed out, we don't want to prematurely rush in areas that
will be failings while we have the opportunity governmentally
and in controlled pilots to take a look at these areas.
Dr. Eisenberger. I just want to say one more thing, and
then--as the Academy report said, and we also agree, that, for
example, in addition to buses, distributed power gives you
another way to get into this market. It gives you a way of
dealing with fuel cells, providing an incentive to grow your
production facilities.
Mr. Larson. How much money is needed in bridge technology?
Dr. Eisenberger. Well, to make a quantitative statement,
one would really have to go into the details.
Mr. Larson. Hypothetically, nothing that I would hold your
feet to the fire about, but----
Dr. Eisenberger. No.
Mr. Larson [continuing]. Just give us some parameters. Is
it bigger than a breadbasket?
Dr. Eisenberger. Well----
Mr. Larson. And this is the frustration on the part of
Members, I think----
Dr. Eisenberger. Right.
Mr. Larson [continuing]. Is that in earnest, Members and
this Chairman has been exceptional, want to help, but want to
get realistic figures, because I think, both from a substantive
and academic standpoint, the--in this case, I think the ends
does justify the means.
Dr. Eisenberger. Well, let me put--let me say it this way.
I really agree very much with your comments that energy is so
critical to what we do that to underfund it, to not give more
resources, in general, to develop our options for our future
and be able to pursue the bus idea that you made, distributed
power, all right, is really, I think, penny-wise and pound-
foolish in the long-term. And because it is a major issue,
this--the whole future of success of, as you pointed out, all
of these things coming together here, requires, really, a very
significant investment. And to some extent, we are
underwhelming the problem. And I--my sympathy goes to Mr.
Garman who has to manage a project where he has these great
objectives and he is given not all of the resources to
accomplish them.
Mr. Larson. Believe me, our sympathies go to him, too. And
it may not sound that, but I know--we know the difficult task
that he is operating on.
Dr. Eisenberger. Right.
Mr. Larson. And Dr. Ramage.
Dr. Ramage. Yes. Just specifically on the buses, I--our
Committee felt very strong that in the early part of the
transition to a hydrogen economy that the--you would actually
use fleets, buses and other things, and you could use existing
production capacity, so you don't have to worry about the
infrastructure, and there is hydrogen out there, and you
basically would do it. And that would allow you to enter the
market with fleets, and buses would be a big part of that. And
that allows you to move forward while you are doing your R&D
program. It allows you to get commercial use. It allows
consumers to get use. You get learning demonstrations. So, in
our vision, that literally is the first part of this
transition. Later on, you would have distributed production at
sites when vehicles come in the market. But the buses and mass
transportation would be the first part of this.
Mr. Larson. What about the transmission? And I noticed in
your comments, and I really do appreciate the talk about making
the transition with coal and other entities, you didn't mention
natural gas, which I would think, from a distribution
standpoint and pipeline standpoint and transmission standpoint,
might be critical to the future, although we note that that is
a limited source as well.
Dr. Ramage. Well, the--our issues on natural gas are we
believe that during the transition, natural gas should be a
primary source of hydrogen, but in the steady state, unless we
have some major natural gas findings in this country. If you
look at EIA and the amount of natural gas that we are
importing, it becomes the same national energy security issue
as oil. And so we separated and basically recommended that the
DOE make--decrease the size of their program in large-scale
natural gas, focus on using natural gas during the transition
for small-scale reformers.
Mr. Larson. How far away are we with coal and making that--
in being able to capture the hydrogen from that process?
Dr. Ramage. I think you are probably--I mean in a coal
plant, like the parameters in our future, are 15 or 20 years
away. So it is a--coal is a long-term part of the steady state
solution.
Chairman Boehlert. The gentleman's time has expired. The
Chair recognizes the Chairman of the Subcommittee on
Environment, Technology, and Standards, a distinguished fellow
of the American Physical Society, Dr. Ehlers.
Mr. Ehlers. Thank you, Mr. Chairman. And I am very pleased
to have another physicist at the table. And thank both of you
for your work in this extremely difficult project. You have
done a good job of identifying the problems, and I am--in my
analysis of it, which incidentally is far less extensive than
yours, but agrees with yours, there are so many different
things that have to happen simultaneously. And it has to be an
incredible governmental/industry cooperation to achieve the
results that we want. Such simple matters as deciding how is--
well, you mentioned fuel storage in your study. It is not just
storing it underground somewhere, but how are you going to
store it in the car, because that influences the service
stations of the future? Are you going to get in--go in and get
a tank full of liquid hydrogen? Are you going to go in and
exchange high-pressure cylinders? Tremendous decisions have to
be made with major impacts upon industry, and it is going to
take intense cooperation to get this done in any reasonable
sort of time.
In terms of the production of hydrogen, I will simply tell
my colleague from Massachusetts, I personally think natural gas
is too good to burn or to use for hydrogen. It is too precious
as a petrochemical feed stock, and we should reserve it for
that. I hope that nuclear power is an efficient way to produce
hydrogen, but I haven't seen the evidence yet.
So what I really appreciate is your pointing out the
complexity. It can be done, perhaps more rapidly than you say,
but it is going to have to be a national crash program. And I
don't--and that leads to a question for Mr. Garman on the
budget. I am very concerned about DOE's budget. Last year, when
you testified, you said that this program is not going to gore
anyone's ox. I think this year's budget shows that maybe you
aren't goring them, but you are certainly bloodying them. But
also, I am very concerned that you don't seem to have much
money in the budget to deal with this in terms of the problems
that have to be dealt with. And I wonder if you would give us
some comment on those two issues.
Mr. Garman. Thank you. And I----
Mr. Ehlers. It appears that other alternative energy
sources are suffering, and also, you are not getting enough.
Mr. Garman. Thank you. And I appreciate that. And it goes
also back to the Chairman's opening statement with respect to
his observation or belief that it is unfortunate the
Administration proposes to pay for hydrogen research by cutting
the rest of Secretary Garman's programs. That hasn't happened,
Mr. Chairman.
Chairman Boehlert. That is good news. Tell me the rest of
the story.
Mr. Garman. I will tell you the rest of the story. Overall
funding for the Office of Energy Efficiency and Renewable
Energy is up. Our renewable energy program funding is up 4.8
percent. Yes, there was a reduction of 2/10 of one percent in
energy efficiency funding, and there were also some shifts in
that funding, but our overall budget is up, particularly when
you look at the impact of congressional earmarks that are
funding that is not on our R&D planning. Our wind power is up.
Hydropower is up. Geothermal is up. Solar power, if you remove
the earmarks of about $1.5 million, solar power is up. Biomass,
if you remove the $51 million worth of earmarks in biomass that
do not contribute to our program planning, the program planning
that we have come together with industry, with the Department
of Agriculture to devise, our biomass is up some $30 million.
Mr. Ehlers. You are beginning to sound like some radio
announcer giving the stock quotes for the day.
Mr. Garman. So, you know, I feel, actually, quite the
opposite. I don't feel encumbered or savaged; I feel blessed
that in a constrained budget environment, we have been given as
much as we have been given. And that puts and awesome
responsibility, I think, on us to perform in that context.
Chairman Boehlert. That you attribute to the exceptional
confidence people have in you.
Mr. Garman. I hope so, Mr. Chairman. I hope it is
something.
Mr. Ehlers. But you would not object if the Congress gives
you more.
Mr. Garman. I think the President has submitted a very good
budget, and let me say this, this is an important--and as I
said before, and I know it is impolitic of me to say it in this
forum, but we were saddled with $67 million worth of earmarks.
I even have an earmark for hydrogen, Mr. Chairman, that doesn't
have anything to do with hydrogen.
Mr. Ehlers. Okay. We will try and take care of that this
year.
A quick question, Dr. Eisenberger. On the APS report, you
talked about the storage problems. Could you give a quick
rundown what you see those to be and what you think the most
likely choice is going to be?
Dr. Eisenberger. Well, you know, it is no accident we are
running on gasoline, because it is a very unique fuel in terms
of its capability in terms of energy density and ability to
store in the automobile the amount of energy you need to travel
what the consumer has learned to understand they can expect. I
just turns out that currently hydrogen, given its basic
properties, you can squeeze it, you can do various things to
it, it is extremely difficult to, currently, have a material
where you can imagine getting enough energy density in the
automobile in a way that is safe so that you can give the sort
of performance that the consumer has learned to--or that the
transportation sector needs. And so right now, there is not a
known answer to this. And so that is a gap that is a really
serious problem. Now what I would say is, and it gets back to
your comment and it is a thing that concerns us as well, to
make this thing work, it is no better than the weakest link in
the chain, right. You can't get there if--because it is a
consumer-oriented thing, if something doesn't work. And it is
that--the magnitude and the complexity that suggests to us that
this idea of piloting, and I don't want to--and I agree that
there is verbiage here that we could clean up, but piloting
things that are ready to be piloted and then focusing very
clearly on those gaps which really are serious in terms of not
having, as Dr. Ramage said, even a commercial performance
demonstration yet, that one has to make sure that one really
focuses on those things, because one knows one can't go to
market until one gets those things addressed.
Mr. Ehlers. Right.
Chairman Boehlert. The gentleman's time has expired.
Mr. Costello.
Mr. Costello. Mr. Chairman, thank you.
Mr. Garman, I want to ask you a few questions about the
FutureGen program. The Administration has made it very clear
that it is the important program for this Administration. And
when George Ruddins testified before our Committee, I think it
was in November of 2003, he provided a tentative timeline for
the FutureGen project. And you know, in the fiscal year 2004
appropriations bill, DOE was directed to produce a program plan
for the FutureGen project by December 31 of 2003, and I am
wondering what the status of the plan is.
Mr. Garman. I made sure we spoke to George right before I
came up, and the program plan, which was promised to you, is in
the final review process within the Administration. And I am
told it will be transmitted to Congress shortly. And we hope to
have that up to you as quickly as possible. That brings to mind
the fact that I have promised this committee a hydrogen posture
plan, which I produce right now. [The information referred to
appears in Appendix 2: Additional Material for the Record.] I
have done that. And I will have George follow up with your
staff, but it is out of the building. It is out of DOE and
undergoing interagency concurrence at the White House, I am
told.
Mr. Costello. When you indicate that it will be delivered
to the Congress shortly, could you get a time frame on there,
30, 60, or 90 days?
Mr. Garman. I would hope it would be within a week or two.
Mr. Costello. Let me ask another question about FutureGen
and about funding for the project. The coal R&D budget provides
$237 million of previously appropriated funding specifically
for FutureGen. There are $233 million of new funding available
for other coal R&D programs, which is almost a 50 percent cut
in programs like fuel cell research, coal gasification,
advanced research centers, and other important programs
compared to last year. And as, I think, we all realize that
FutureGen is not a replacement for these programs. And in fact,
if anything, the program, FutureGen, can not succeed without
them as a foundation. So I am wondering if you will address
that issue. How do we expect FutureGen to be successful if, in
fact, we are cutting the R&D funds for the other items that I
have just mentioned?
Mr. Garman. I would hope that the program plan would
elucidate that for you. I am told that the project timeline for
FutureGen remains on track for a fiscal year 2004 start and
that there have been some changes in some of the out-year
milestones consistent with assuring, and this may seem ironic
in this context, but that some of the underlying science
matches up well with the deliverables in the project. So that,
since I am the energy efficiency and renewable energy guy and
not the fossil guy, you have delved to about the limits of my
knowledge on that specific point, but we will try to answer
better than that for the record.
[The information follows:]
Insert for the Record
FutureGen Funding and Funding for Other Coal R&D Programs
The funding profile for FutureGen is complementary to and
consistent with the Department's Coal R&D roadmap in key areas, as
reported in the March 04, 2004 FutureGen Report to Congress. The
schedule for the FutureGen project will allow the FutureGen industrial
consortium sufficient time to assess the technical readiness of
candidate technologies for inclusion in the FutureGen research project.
The pace of the research being pursued should provide the opportunity
to choose the technology best suited to meet the FutureGen project
goals. Progress in the ongoing coal research, development, and
demonstration program will provide the necessary technical foundation
to help make FutureGen a success.
Mr. Costello. The last question about FutureGen, and I
realize you may not be the person to answer this, is where does
the Administration with finding a partner in the private sector
as anticipated and directed in this legislation?
Mr. Garman. My notion is that we are finding many partners
and a great deal of interest, not only in the domestic private
sector, but also internationally through the Carbon
Sequestration Leadership Forum. There has been a tremendous
amount of interest from other nations, including Germany and
Poland, in partnering with us and making FutureGen the first
demonstration, hydrogen-producing, zero-emission coal plant in
the world to enable that technology transfer to be universally
adopted around the world and that the interest is there.
Mr. Costello. They--have they mentioned that they will
bring their checkbooks with them to participate?
Mr. Garman. That is--it is well understood that that is
part of the deal.
Mr. Costello. Mr. Chairman, thank you.
Chairman Boehlert. Thank you very much, Mr. Costello. I
love the international cooperation where we do all of the work
and they get all of the benefit without any of the burden of
helping to finance it, so that is something--that is a question
we are all interested in hearing the right answer to, and you
gave the right one.
Mr. Gutknecht.
Mr. Gutknecht. Thank you, Mr. Chairman.
I have a keen interest in this, because I also am the chair
of a Subcommittee in the Agriculture Committee that deals with
renewable fuels. And so we appreciate the opportunity to have
you here today, and we are going to continue to look at this.
First, and this you don't have to answer right now, but I
would like to get a list of those earmarks from last year. That
is problematic, I think. You know, historically, this committee
has done a pretty good job of not recommending earmarks within
NSF or other science research projects, and it seems to me we
ought to try to apply that as well to the Department of Energy.
Second, though, and I think this is a--also a very
important issue, I want to raise the issue of collaboration
with our universities. You know, we have a lot of pretty smart
people and curious students and very good graduate students who
could be extremely helpful in doing some of this research. And
I guess the question is what portion of the Department of
Energy's awards are directed toward university research to help
develop some of these new technologies?
Mr. Garman. Let me answer--I will give you a precise number
for the record, but let me answer it this way, because it bears
on a question asked earlier about the challenge of hydrogen
storage on board the vehicle. And we fully appreciate,
understand, and agree with that challenge. And in fact, this is
one of the areas where the Academy, in its report, actually
commended our hydrogen storage initiative as ``a strong program
with the right balance of basic research''. And the reason I
mention that is because it is our plan, in fact, we will, in a
matter of days, be announcing winners of a hydrogen storage
solicitation, which we have had on the street, composed of
teams of universities and national labs. We thought it was so
important that we make sure that the university component is
included in this for a variety of reasons. First of all, it
helps us make sure that there is the basic research component.
Second, it avails you of that opportunity to take advantage of
research at universities that can often be produced at a much
lower cost than research at national labs because of the
availability of graduate students and all of the other good
things you have in universities. So----
Mr. Gutknecht. Cheap labor.
Mr. Garman [continuing]. We are very much looking forward
to the opportunity to make that solicitation, get more
universities involved in this fundamental research on one of
the most, we agree, vexing problems that we have in making this
initiative a reality. Not to beat this dead horse, we will
probably have to delay the actual funding a little bit, because
of the impact of the earmarks, but we are going to go ahead and
make the selections, let the people know they have--they will
be awarded these things just as soon as we can scrape up the
funding and get it out to them.
Mr. Gutknecht. The next question, and perhaps either Dr.
Ramage or Dr. Eisenberger can jump in on this, and I think this
is something I am keenly interested in, and that is using
renewable energy sources, such as biomass or wind or other
sources like that, to actually produce hydrogen. To what extent
should our hydrogen-related efforts focus on deriving that
hydrogen from some of these renewable sources? And let me give
you an example. I mean, we have--there has been just an
explosion of the latest and most efficient windmills in my
District. I am amazed, with the modest amount of incentive from
the Federal Government, we have seen just an explosion. Now in
some respects, there is at least discussion out there about
using those, when we don't need the power on the grid, to
produce some other energy source, which could be storable. And
hydrogen might make some sense. I would like to get your
particular--particularly Dr. Ramage or Dr. Eisenberger, your
particular point of view on that.
Dr. Ramage. I think it is a very good question. And we
strongly recommend in our report that wind energy play a major
role in the transition and maybe in the steady state, and it is
because wind energy today, in a lot of areas, has almost--is
almost cost-competitive with grid electricity. And also, there
has been a lot of--there is a lot of activity going on in
industry to look at ways to improve it more.
The second piece of this, and that is that we believe that
electrolyzers, which are now a big component in generating
hydrogen, will end up coming down greatly in cost. And so
marrying wind energy with advances in electrolyzers will play a
major role, probably, you know, in the early parts of the
transition to generate hydrogen.
With respect to the question about--you know, we recommend
that biomass not be used directly for gasification as a source
of hydrogen. It doesn't mean we don't think that biological
processes are important. That is more of a fundamental
research. But just looking at hydrogen, there is a lot of land
required. In our report, we identify that, in fact, to use
biomass to generate the hydrogen would take about half of the
cropland in the United States. And it is just not a very
efficient process. While it might be important if there are
limited funds in the DOE, we believe that effort should be
focused more on exploratory ways to look at--directly at
biological means. We do fully support solar energy as a method
to produce hydrogen, particularly direct--but wind is a very
important key component, we think, in the transition. And the
technology is ready. It is close.
Dr. Eisenberger. My comments are along a similar line, but
maybe I will try to take a slightly different cut at it. Part
of the message I have tried to communicate is that in the
understandable pressure in the short-term to try to come up
with solutions to mitigate our dependence on foreign sources of
energy and to deal with issues--environmental issues, we should
recognize that the--in the long-term, there is no alternative
but to find a solution that has some renewable energy source,
some way of converting it into a storable fuel that can be used
in various ways to meet our energy needs. That is the end game.
There is no getting away from that. It is a matter of time. And
some at some level, our concern has been that we need to
balance that understanding of where you are going in the long-
term, and then each step of the way make sure you don't over-
commit your resources in things that are not going to get you
there, and in the process of doing that, I mean I agree with
everybody, like Dr. Ramage said, you can't ensure success.
There are going to be failures, but we know in America what
America does to failures: you leave it and then you don't talk
about it for another 10 or 15 years. And so part of our concern
is that if we focus too much on the short-term and try to
commit to things that won't give what we expect from them and
don't really solve the long-term problems that we have to face,
we could set back the overall initiative. So being prudent is
not because we don't believe hydrogen has a place to--a role to
play, but our prudence is actually concerned that if we move--
get too far ahead of ourselves, we will hurt where we all know
where we have to go.
Chairman Boehlert. Thank you very much. The gentleman's
time has expired.
Mr. Akin.
Mr. Akin. Thank you, Mr. Chairman.
And Mr. Garman, I just wanted to appreciate just publicly
that you came to our District, and there is a lot of interest
and enthusiasm as a result of your stopping out and chatting.
My question is a pretty fundamental one, and I guess it
might be appropriate for Dr. Eisenberger. I guess the concern I
have sitting here, the more I have listened the more I feel
like I am about like a bottle of champagne, it seems like what
we are doing is we are putting some sort of emphasis on
hydrogen. It seems to be almost dictating the solution. We
haven't defined what the problem is. It would be a little bit
like if we are trying to get across a river, and I would
commission you guys to work on suspension bridges. You know,
well, maybe there is another way to build a bridge than a
suspension bridge. It seems like here that is what precisely
are we trying to do. And the big thing that I ask myself in
hydrogen is as people talk about it, it is not like you can
grab yourself by the bootstraps and fly around the room. There
is some source of energy. It is either going to be--I mean, you
can do it on the margin. You can do something with some solar
and some wind and stuff, but when you look at the volume of
energy that there is going to be, and that demand is only going
to go up as nations become more industrial. You know, you have
got basically nuclear, you have got coal, and you have got oil.
Those are your big ones. And hydrogen doesn't change that
equation. So I guess my question is aren't we putting the cart
way before the horse? And shouldn't we be really addressing
specifically what are the problems? Is it foreign oil? Okay.
How do we deal with that? Is it emissions in cars today? Then
how big a problem is that, and how do we deal with that? It
seems like we are going completely backwards. What we should be
doing is just specifically saying this is the problem, this is
the goal, and now what technologies are available? Am I off the
track? Or will you just please respond.
Dr. Eisenberger. I will--you know, it is unusual to hear a
politician describing an idealistic approach to a problem,
right, but I agree with you that conceptually that is the way
one should go about this problem. And that--but on the other
hand, I would also say, as a pragmatist, that energy is so
critical to our society that there is not one single answer.
All right. And we have an interest in moving in hydrogen. You
know. Forces have come together, as was mentioned in the
introduction, where there is support from many sectors to
advance this technology. It has a role to play. It is not the
only answer, as I tried to say. We need other things as well.
And we should not--we should be investing more in alternatives,
and if we would do that, then we could take your approach. If
we had a real commitment to say, look, we are going to solve,
as you pointed out, the security aspects of it, the
environmental aspects of it, then we could sit down and have a
program that would be a lot more expensive than the program we
are now committed to. It would require more options and more
different directions than we are now pursuing.
Mr. Akin. I--just one other--I promised I would try and get
one of these. These are the, you know, questions distributed
ahead of time that, you know, you have to--but this is a good
question. And this is the first page of the NAS executive
summary states: ``DOE should keep a balanced portfolio of R&D
efforts and continue to explore energy supply and demand
alternatives that do not depend on hydrogen. If battery
technology improved dramatically, for example, all electric
vehicles might become the preferred alternative, however, EERE
funding for battery and electric vehicle technology has been
drastically reduced over the last few years.'' Based on the NAS
statement, might you increase funding for battery or non-fuel
cell vehicle technology research?
Dr. Eisenberger. That is along same lines as what I was
saying before. You have got a problem, whoever wants to--and
Dr. Garman--I mean, Mr. Garman, if you wanted to respond,
that----
Mr. Garman. I thank you for that question, because once
again, it gives me the opportunity to correct. Our hybrid and
electric propulsion vehicle program budget funding line is not
down. It is up. We are not investing all of our eggs in the
hydrogen basket. We are spending more on hybrid technology and
energy storage technology. That is batteries. We think there is
great promise in lithium ion batteries, and we think that is a
very important technology. And the reason that it is such a
good bet for us to be investing in those technologies is not
only will those be used in fuel cell vehicles when they come to
pass, but they could also be used in the interim. And so this
is a no-brainer. We----
Mr. Akin. You are disagreeing with the premise.
Mr. Garman. I am disagreeing with the premise----
Mr. Akin. You are saying--okay.
Mr. Garman [continuing]. Of the question. Yes, sir.
Mr. Akin. All right. Thank you very much. Anybody else? I
have got another two seconds left.
[No response.]
Mr. Akin. No? Thank you. Thank you, Mr. Chairman.
Chairman Boehlert. Thank you very much.
Ms. Biggert.
Ms. Biggert. Thank you, Mr. Chairman.
Mr. Garman, a central theme of both reports is that there
are hard technical problems that require basic research to
solve. And I think both reports are clear in recommending that
funding be shifted away from product development in large-scale
demonstrations toward exploratory, fundamental research. And I
was pleased to see that the Office of Science was included in
the Initiative with $29 million in new and reallocated funding.
Do you agree with the reports that more basic and fundamental
research is needed to meet the goals of the Initiative? And
while the funds of--for science is a good first step, is the
Department planning any future increases in basic research?
Mr. Garman. I think the key, and I will leave it to the--to
Dr. Ramage to correct me if I am wrong, but first of all, on
the issue of demonstrations, we are not proposing to do large-
scale demonstrations at this time. We don't think it is ready.
We have not proposed that. We have proposed to do very small-
scale, learning demonstrations where we have vehicles, not in
the millions, not in the hundreds of thousands, but in the
tens, tens of vehicles to produce data and information that
feeds back into the R&D process.
Secondly, yes, we do agree with the proposition that there
needs to be more basic and exploratory research. And as you
noted in our fiscal year 2005 budget submission, we have
involved the Office of Science in this work, and we are also--
you will be seeing us doing more exploratory research in our
research that we are doing as well above and beyond that $29
million. So we concur with the recommendations in the report.
Ms. Biggert. Thank you.
Then, Mr. Garman, again, we know that it is possible to
produce a car that gets 50 miles or more to the gallon. And in
fact, there are a few on the market today, such as the Toyota
Prius. Rumor has it that you drive one?
Mr. Garman. I bought two, in fact.
Ms. Biggert. Okay. Well, thinking of one in the APS report
shows in energy information Administration projection of the
U.S. demand for imported oil increasing steadily while U.S.
production is flat, producing a need for 16 million barrels per
day of imports. And the same graph shows that a fuel economy of
39 miles per gallon, only about 3/4 as efficient as the Prius,
would save about five million barrels per day. But the fiscal
year budget request for the hydrogen program has a goal of only
1/10 of one million barrels per day in 2020. And why are we
cutting programs? I think you just said we were not cutting
programs, if that is true.
Mr. Garman. We are not. And in fact, we are enthusiastic
supporters of hybrid vehicles. The President has requested the
passage of a tax credit for purchases of hybrid vehicles, which
is in the energy bill, awaiting passage. He proposed that in
May of 2001 with the issuance of his National Energy Plan. So
we believe very strongly that hybrids are a wonderful bridge
technology and even more so because some of those same hybrid
technologies, the power electronics, the energy storage, the
electric drive, will also be incorporated in the fuel cell
vehicles of the future. So we are--on this graph, which you
point out in the APS report, I think it is important to point
out that that graph came from our office. And I think that
even--the thing that is interesting to me is even if you have
an immediate 60 percent increase in corporate average fuel
economy standards and a much smaller increase was resoundingly
defeated in the other body by a wide bipartisan margin, I have
to point out, that curve still starts going up after a certain
point in time. Yes, it does save oil, but it does not get us on
that pathway of eventually delinking light-duty transportation
and oil use. And Representative Akin really asked the million-
dollar question: What are we doing this for? And the answer is
quite simple: we are doing this to eliminate and delink light-
duty transportation from petroleum use. The great thing about
hydrogen is it is not an energy source; it is an energy
carrier. And we can produce it from coal and nuclear and
renewable energy and a lot of other things we have here.
Because as this committee has pointed out, we don't have a lot
of oil. We have two percent of the world's proven reserves, and
the Persian Gulf nations have 64 percent. So we are doing this
to get off of imported petroleum. We are also doing this to
eliminate emissions of all kinds at the tailpipe and delink
light-duty transportation from oil use. It is that simple.
Chairman Boehlert. Thank you very much. The gentlelady's
time has expired.
Ms. Biggert. Mr. Chairman, I have one more question. Could
I submit it and ask that I get a response?
Chairman Boehlert. By all means, all Members will have the
opportunity to submit questions in writing to our witnesses,
and we would appreciate timely responses.
The Chair is now pleased to recognize the distinguished
Chairman of the Subcommittee on Space and Aeronautics, who is
fresh from an overwhelming victory at the polls in California
just yesterday, Mr. Rohrabacher.
Mr. Rohrabacher. Yes, that is why I am the distinguished
instead of the extinguished chairman.
I would be happy to yield to Ms. Biggert for--to let her
ask her question. Go right ahead. You only have two minutes.
Ms. Biggert. Thank you very much, Mr. Chairman.
This is for Dr. Ramage. One of the recommendations from
your report is a greater emphasis on fundamental research on
photosynthetic microbial systems. And my understanding is that
the Office of Science Environmental Genome program is getting
promising results as it examines hydrogen-producing microbes.
Would you--could you expand a little bit on your recommendation
and tell us more about the potential of the environmental
genomics?
Dr. Ramage. I am not sure. Let me--could I make a comment
about why we recommended focusing directly on hydrogen
production? If you think about most renewables make
electricity, and when you make electricity with a premium fuel
and you have to convert it to hydrogen, which is a commodity
fuel, you are losing energy, and you spend money. And that led
us, by looking at costs, the recommendation to look for ways
directly in order to make hydrogen from biological and solar
methods. There has obviously been a lot of progress made in
genomics and metabolic type of activities in general and the
ability to design organisms that can actually produce hydrogen
has been increasing a lot. There is still a long way to go, but
our Committee strongly felt that that is where a lot of the
exploratory money should go and go away from, you know,
traditional biomass, because there has been a lot of progress
made.
Ms. Biggert. Thank you. Thank you.
Mr. Rohrabacher. All right. Well, let us see here. Just one
note before I ask my question. I have been a Member of this
committee long enough to remember the Partnership for a New
Generation of Vehicles program, the PNGV. Do we all remember
that? We spent about $1 billion in that, and then we just sort
of walked away. And there was $1 billion that evaporated. I
just hope that this isn't one of those types of things where
there are a lot of press conferences and a lot of verbiage and
then just nothing to show for the money that has been spent.
And speaking of spending the money, I would--from the
testimony, I understand that we don't even have a tank designed
now for the automobile that could actually have hydrogen and
use it as a hydrogen storage supply system that would then
power the car. How much money is going into finding and
designing one of those in the budget that you are asking for
right now?
Mr. Garman. We actually do have a tank, and the hydrogen
fuel cell vehicles that are on the road in California and other
place do carry hydrogen on board the vehicle, unfortunately,
not enough, about the range of 150 to 175 miles.
Mr. Rohrabacher. Right.
Mr. Garman. And we need a 300-mile range or better.
Mr. Rohrabacher. Okay. So how much are we spending on
trying to develop that tank out of the money that is being--you
are asking for this year?
Mr. Garman. Our overall storage initiative is earmarked at
about $150 million over five years.
Mr. Rohrabacher. $150 million over five years?
Mr. Garman. Yes, sir, around $30 million a year.
Mr. Rohrabacher. Boy, that is a lot of money to design a
storage tank.
Mr. Garman. Well----
Mr. Rohrabacher. $150 million----
Mr. Garman [continuing]. If I can explain why, it is--what
we are doing is looking at completely new materials----
Mr. Rohrabacher. All right.
Mr. Garman [continuing]. Including chemical hydrides, metal
hydrides, allenates, carbon nanotubes, other more esoteric
storage materials that can be used to store that hydrogen at
near ambient temperatures and pressures. Today, the kind of
hydrogen tank on board the vehicle is a 5,000 or 10,000 p.s.i.
tank of compressed hydrogen. We think--and of course,
cylindrical tanks are very bulky; they take up a lot of space
on the vehicle. They cost a lot of money. So we are trying to
come up with new designs in partnership with the private sector
that can create a tank that will meet those performance
standards----
Mr. Rohrabacher. So there is no material that exists today
that could be used to construct a hydrogen fuel tank that can
meet the consumer benchmark?
Mr. Garman. That is correct, that meets----
Mr. Rohrabacher. As of right now?
Mr. Garman [continuing]. Our cost targets. That is correct.
Mr. Rohrabacher. So you are having to go straight to, you
know, really fundamental science on this, and you are going to
spend $150 million on that, and this is a--could I say it is a
shot in the dark, because you don't really know if you are
going to find it or not?
Mr. Garman. I would say that it is--this is the one area,
the primary area where we think we do need a technological
breakthrough in order to meet that consumer demand.
Mr. Rohrabacher. Okay. There is no technological
breakthrough needed to make this fiscally responsible in terms
of what type of fuel you will be using in order to create the
hydrogen for fuel in the first place? That is not a--you
don't--that is already decided in a----
Mr. Garman. No, sir. I think the--again, the beauty of
hydrogen is that you have a variety of different primary energy
sources that you can use to make the hydrogen fuel. I think the
early years, as it has been pointed out, that is most likely to
be natural gas distributed at the station. And we believe we
can meet that target with, you know, $1.50 per gallon of gas
equivalent hydrogen, or $1.50 per kilogram by 2010.
Mr. Rohrabacher. That is a pretty good----
Chairman Boehlert. The gentleman's time has expired.
That is a pretty good goal. Come up to the State of New
York where the gasoline price is considerably higher.
The Chairman now recognizes Dr. Burgess.
Dr. Burgess. Thank you, Mr. Chairman.
And actually, I am very relieved to hear that there is not
being any diversion of funds from the hybrid system, because,
like you, Mr. Garman, I believe very much in that technology.
And in fact, I went out in January to buy a Prius, and in my
part of the world, you can't buy one, and I guess that is
because you bought two, so I wanted to make a note of that.
The--and you have answered this question already, but I
will go ahead and ask it, because it hasn't specifically been
answered, but the idea of getting our hydrogen from natural
gas, our--and I do recognize that there are other sources, and
I am very glad to hear you talk about solar and wind sources
for generating hydrogen in the future, but in the short-term,
are we trading our dependence on foreign oil for our dependence
on foreign natural gas?
Mr. Garman. We--you have given me an opportunity--a very
interesting point that I think has been lost. And we are,
today, producing nine million metric tons of hydrogen each and
every year from natural gas. We make a lot of hydrogen in this
country, mainly for use at refineries and other locations for
desulfurization of gasoline and diesel products. We would--if
we wanted to fund our--or fuel our entire fleet using natural
gas, we would need around 53 million metric tons, which is, you
know, not a huge factor above that that we are already
producing today. Now I--but I agree with the fundamental
premise. We want to be careful. We do not want to trade a
dependence on oil for a dependence on natural gas that has to
be imported, which is why I think the point of the Academy is
right on when they say plan for the transition period when you
expect to be using natural gas, but do the fundamental work
that provides the breakthrough in the other sources of hydrogen
so that they can come on line soon after that point.
Dr. Burgess. Mr. Chairman--I thank you very much.
Mr. Chairman, I would just add that the work that this
committee did on the nanotechnology bill last year, perhaps,
can give rise to the technological breakthrough that they were
asking for with the carbon nanotubes and the reinforced carbon
concept that now is the leading edge of the wing of the Space
Shuttle, which may someday come to the point where you could
use it as your tank.
Until we get to the point where we are making hydrogen from
some other source, I look forward to seeing some hydrogen wells
drilled in West Denton County. I would like that.
Chairman Boehlert. Dr. Burgess, I just--thanks for bringing
the National Nanotechnology Initiative up.
And I would like to thank our witnesses. Let the record
show that as Dr. Burgess was making his commentary, all of the
witnesses nodded in the affirmative. So they are in agreement
with him and talking about the good work of this committee.
And I thank you very much. Do you have anything more?
[No response.]
Chairman Boehlert. Just one final question as we wrap this
up. I think we have reached a consensus. And how do you--how
will you evaluate, Dr. Ramage and Dr. Eisenberger, if they at--
Secretary Garman and his people have taken your recommendations
to heart? Dr. Ramage.
Dr. Ramage. Well, I think that I am encouraged by what Dave
has said. And I very, very--I think it was an interactive
process, and I am encouraged by what he said about what the
issues are, and I am also encouraged by what he said about the
balance of the program and also the fact that funding hasn't
been decreased in other areas.
I also know that they are moving toward developing a
systems approach to managing their overall program, which is a
very important part of our recommendation. So we have been very
encouraged, and so I am pleased with what I have heard today.
Chairman Boehlert. Dr. Eisenberger.
Dr. Eisenberger. Again, I will answer in two ways. I think
that within the constraints that Dr. Garman--I mean that Mr.
Garman is working under, I think he is responding. But I think
the constraints should be looked at. I think that some of the
questions that were asked in this hearing require that we take
a look at the project in a larger context of our needs and make
sure that the program is not dictated by externalities that
really have very little to do with any specific objective. And
there is some indication that those distortions are part of the
problem that we are trying to deal with.
Chairman Boehlert. Thank you very much. And you have both
confirmed by what you said in response to a number of questions
something that the Chair has long felt, and I know Members of
the Committee, who are familiar with Secretary Garman, feel
that he has an extensive outreach program. He talks to people
like you, but more importantly, he occasionally listens to
people like you. And once in a while, he even listens to those
of us in the Congress. So I want to commend you, Mr. Secretary,
for the outstanding work you do. And I want to thank you for
being resources for this committee, Dr. Eisenberger and Dr.
Ramage. We go forward with a program that is important for
America for a whole lot of the right reasons. And I feel it is
in good hands. And I--but the good hands should know that we
are watching.
Thank you very much. This hearing is adjourned.
[Whereupon, at 4:10 p.m., the Committee was adjourned.]
Appendix 1:
----------
Answers to Post-Hearing Questions
Answers to Post-Hearing Questions
Responses by David Garman, Assistant Secretary, Energy Efficiency and
Renewable Energy, Department of Energy
Q1. Has funding for battery and electric vehicle technology declined
over the last four years? Please provide a table for historical funding
level (see example below) for hybrid vehicles, for electric vehicles
powered completely by batteries, and for fuel cell vehicles, indicating
any overlaps of funding between vehicle types, from fiscal year 1999 to
the current request. Please exclude work that applies to all vehicles
such as lightweight structural materials. Please provide a total for
each vehicle type as well as documenting the amount from each budget
line.
A1. Request levels for battery research and for electric-drive vehicle
technology have risen over the past several years, but the research
emphasis has shifted over the period, resulting in relatively more
funding for hybrid and fuel cell vehicles and less for purely-electric
vehicles. The following table provides summary budget data from FY 1999
through FY 2005 for work on Hybrid, Battery Electric, and Fuel Cell
Vehicles.
Q2. Since both hydrogen fuel cells and batteries require scientific
breakthroughs, what is the technical basis for the Department's strong
preference for investment in fuel cells, versus high energy density
batteries, for electric vehicle propulsion?
A2. Electric vehicle (EV) propulsion battery R&D has been curtailed due
to two severely limiting attributes for which no clear research
solution has emerged: energy density and recharging time. The low
energy density of battery technology typically limits EVs to a range of
approximately 100 miles, versus the range of a conventional vehicle of
350-400 miles. The recharge time of an EV battery is up to six hours,
versus the refueling time of a conventional vehicle of less than five
minutes. The combination of these two negative attributes led to
rejection of electric vehicles by the marketplace and by major
automotive manufacturers.
The Department continues a small effort in EV batteries to address
these barriers, but has shifted the majority of vehicle battery R&D to
focus on the high power application required by hybrid electric
vehicles, including fuel cell vehicles. Hybrid vehicles do not suffer
from range limitations and recharging is conducted continually during
vehicle operation. The major focus areas of this activity are use
tolerance, battery life, and cost reduction.
Fuel cell technology is not inherently limited by range and
refueling time in the manner batteries are. Current refueling takes
less than five minutes (high pressure tank storage). Like a battery,
fuel cells require two reactants, typically hydrogen and oxygen. But
since fuel cells obtain oxygen from the air (essentially an infinite
storage tank) the refueling and capacity of oxygen is not an issue.
Therefore, the limiting factor in fuel cell vehicle range is hydrogen
storage. Although our current ability to store hydrogen limits vehicle
range to approximately 200 miles, this is mainly volume limited. On a
weight basis, the entire fuel cell system, including hydrogen storage,
has a specific energy (Wh/kg) approximately double that of today's
advanced batteries.
In the spring of 2003, DOE convened a ``think tank'' meeting of
distinguished scientists, which determined that significant promise
exists in improving on the current storage capability of hydrogen:
``The group believes that while the problem is challenging. . .there
are materials and structures that offer promise for hydrogen storage at
higher capacities.'' While significant improvements are required to
attain a vehicle range commensurate with conventional vehicles,
projects are now in place to address this issue. We recently announced
approximately $150 million in hydrogen storage awards, including the
initiation of three Centers of Excellence.
Q3. Please estimate the BTU's saved per federal dollar spent for
Weatherization and for the Industries of the Future program.
A3. The Department understands the Committee's desire for clear cost-
benefit calculations across the EERE portfolio in order to make wise
funding recommendations. It is problematic, however, to compare EERE
programs using a straight Btu-saved-per-dollar-invested metric. The
EERE program portfolio is designed to meet a variety of National needs
and provide multiple benefits not fully captured on a Btu-saved-per-
dollar-invested basis. These include reducing energy bills of low-
income Americans, the primary focus of the Weatherization program.
Comparisons are also complicated by differences in the composition
of EERE costs across programs and in the time horizons of the expected
benefits. For instance, Weatherization dollars pay for the cost of the
technologies purchased, and the benefits begin to accrue immediately
after installation. The Industrial Technologies Program (ITP) dollars
pay mostly for research with potential benefits realized in the future.
The cost and benefit estimates discussed below are based on
detailed, individual program evaluations available to date. As part of
its recent restructuring, EERE continues to improve the consistency of
cost/benefit measures across its program portfolio; at this point,
however, EERE cannot fully compare costs or benefits of the efficiency
improvements enabled by these two programs. Specifically, EERE is
developing ways of estimating private sector costs, as well as more
thoroughly ``backing out'' energy savings that would have occurred
without federal assistance.
The Weatherization Assistance Program (WAP) funds energy efficiency
improvements to low-income homes for Americans who lack the means of
financing such capital investments. Energy price spikes can force these
Americans to make painful tradeoffs between adequate heating, medical
care, nutrition, and housing. Based on our most recent comprehensive
analysis (conducted by Oak Ridge National Laboratory and published in
2002), Americans' energy bills are reduced by $1.30 for every dollar
spent on weatherization; these savings are even greater when energy
prices rise. This program also provides associated benefits that are
more difficult to quantify, such as providing local building expertise,
decreasing homelessness, and reducing the risk of home fires.
WAP has requested $291.2 million in the FY 2005 budget request.
EERE has estimated that these dollars, in combination with leveraged
funds provided by State and local utility partners will allow the
program to weatherize over 200,000 homes (118,900 homes with DOE funds,
and approximately 100,000 additional homes with leveraged funds). While
federal dollars are projected to result in approximately 5.0 trillion
Btu of source energy savings in 2005, federally-leveraged additional
funding is projected to save a further 3.3 trillion Btu in source
energy, for an annual total energy savings of 8.3 trillion Btu.
Including leveraged energy savings, each federal WAP program dollar
yields roughly 430,000 Btus in energy savings over the assumed 15-year
life of these improvements.
The Industrial Technologies Program (ITP) develops, manages, and
implements a balanced portfolio that addresses industry requirements
throughout the technology development cycle. As opposed to the WAP,
ITP's primary strategy is to invest in high-risk, high-return R&D.
Investments focus on technologies and practices that will provide clear
public benefit but have market barriers preventing adequate private-
sector investment.
From 1977 to 2002, ITP invested approximately $2.65 billion
(constant 2002 dollars) supporting research, development, and
demonstration (RD&D) projects that have produced over 160 technologies.
EERE estimates that the cumulative benefits of the private sector
investments made in these technologies are estimated at roughly 3,700
trillion Btu, or roughly 1,400,000 Btu saved per federal dollar
invested. Significant economic and environmental benefits are also
achieved.
Q4. In your testimony you stated that ``[W]e fully concur with 35 of
those 43 recommendations. . .'' from the NAS report. Which were the 35
recommendations DOE concurred with and what is DOE specifically doing
to address each of them? What objections does DOE have to the other
eight? Has DOE decided to reject them entirely?
A4. DOE has not explicitly rejected any of the NAS recommendations.
Please refer to the attachment to this document that details the DOE
response to each NAS recommendation, including the eight outstanding
recommendations. The following two recommendations are examples of
recommendations where DOE has not fully concurred, as further
consideration is required:
Recommendation 3-2 to discontinue PEM applied R&D for
stationary systems: DOE concurs with the concept of focusing
R&D to address fundamental barriers that face all fuel cell
applications. However, this recommendation would have
significant negative impact if not transitioned appropriately
(potentially eliminating important R&D of value to both
stationary and transportation applications), would send a
strong negative signal to the fuel cell community and
investors, would result in the loss of substantial industry
cost-share, and would not allow DOE to fulfill its current
obligations under several cooperative agreements. DOE feels
significant discussions with its stakeholders and development
of a transition plan is required before this recommendation can
be implemented.
Recommendation 3-lb to end on-board fuel processing:
DOE is currently conducting a scheduled fuel processing ``go/
no-go'' decision process, which includes input from an expert
panel on the feasibility of on-board reforming. This process to
examine on-board fuel processing was in place well before
release of the NAS report, and DOE feels that a final decision
on the NAS recommendation should not replace the formal ``go/
no-go'' process. A public announcement on this ``go/no-go''
process is scheduled to be released in July 2004.
Q5. In your testimony, your response to the American Physical
Society's (APS's) recommendation against funding large-scale
demonstrations was that your demonstrations were ``learning
demonstrations.'' What are the specific characteristics that
distinguish a learning demonstration? How does it compare in terms of
expense to a commercial-scale demonstration? Does this classification-
learning demonstration-only apply to the EERE hydrogen demonstrations?
How does DOE respond to the APS recommendation against funding large
demonstration projects in the context of other programs?
A5. The Department's vehicle and infrastructure learning demonstrations
are an extension of our research and critical to meeting the goals of
the President's Hydrogen Fuel Initiative, including the program's
technical targets that support the 2015 industry commercialization
decision. As pointed out during the discussion at the Science hearing
by Michael Ramage, Chair of the National Research Council's Hydrogen
Committee, ``a continuum of basic science, applied research,
development, and learning demonstrations is necessary for the
successful transition to a hydrogen economy.''
The key characteristics of the hydrogen learning demonstrations
are:
Generation of important data that will be used to
guide and refocus future research and development efforts
Identification of operating issues not previously
considered, e.g., technology performance in different climates
Examination of system integration issues
Evaluation of performance and durability under real-
world operating conditions
Teaming of auto companies and energy companies, which
is critical to the success of the initiative
Leveraging by industry of 50 percent of the funding
Learning demonstrations are not unique to the EERE hydrogen
program. Any demonstration that has the characteristics described above
would be classified as a learning demonstration. However, the approach
of bringing together the automotive and energy industries, which are
crucial to the development of a hydrogen infrastructure, is unique.
This approach will allow the Department and the Congress to track the
progress made and the future potential of this important technology. If
the Department does not follow through with the hydrogen learning
demonstrations, these essential partnerships will probably dissolve and
we will lose valuable financial and technical leverage from industry.
The characteristics of commercial-scale demonstrations are quite
different. They involve mature technologies that are ready for market.
Commercial demonstrations put the technologies in the hands of the
public or fleet operators to encourage or incentivize consumer
acceptance and to stimulate market development and expansion.
Commercial demonstrations can also be used to subsidize production so
that the necessary volumes can be achieved to lower cost. Without a
specific program in mind and understanding of relevant policies
approved by Congress, the cost of commercial demonstrations cannot be
estimated.
We believe that the American Physical Society's overemphasis on
basic research is too limiting. Conducting stand-alone basic research
is insufficient to achieve our 2015 goals; applied research and
technology demonstrations are critical to meeting the technology
milestones leading to the 2015 industry commercialization decision and
to begin the transition to a hydrogen economy. Basic research is
critical to understanding the underlying science that will lead to
hydrogen and fuel cell technology improvements in the near-term and
potentially ``breakthroughs'' in the long-term.
Almost 85 percent of the hydrogen budget is for research and
development efforts. The Department's mix of hydrogen funding according
to OMB circular A-11 for the FY 2005 budget request is as follows:
Basic Research: 12.9 percent
Applied Research: 42.5 percent
Development: 29.2 percent
Demonstration: 13.4 percent
Deployment: 2.0 percent (Education)
Q6. What projects related to hydrogen might have been funded if
additional funds were available?
A6. Additional funding would be used to address two major challenges
facing the hydrogen economy--hydrogen storage capacity and hydrogen
production cost. The most critical challenge facing the hydrogen
economy is the development of a viable on-board hydrogen storage
technology. No technology available today meets consumer requirements
in terms of vehicle driving range, weight, volume, and cost. To address
this challenge, an elite group of university scientists recommended the
establishment of Hydrogen Storage Centers of Excellence to be led by
DOE National Laboratories and to include university and industry
partners.
Funding for the Centers was requested in the FY 2004 budget.
However, due to Congressionally-directed projects in the FY 2004
hydrogen appropriation, no funds were available to start the
competitively-selected Centers of Excellence and other university
projects. In addition, funds requested in FY 2004 to start critical
renewable hydrogen production and delivery R&D projects were not
available due to the earmarks. The Department plans to start these
storage and production projects with FY 2005 funds, subject to
Congressional appropriation.
Q7. In the Vehicle Technologies budget, the largest decrease is due to
a completion of the light truck engine program. Given the increase in
the size of the U.S. light truck fleet, this type of work would seem
extremely relevant to reducing our foreign oil use. What programs or
projects were selected as having greater benefits? How has technology
improved over the course of the program? Are manufacturers
incorporating the improved technology into their vehicles?
A7. The Light Truck Engine (LTE) program was initiated in 1997 to
address the increasing fuel consumption in this growing vehicle
segment. The primary focus was the development of advanced clean diesel
engines that could increase the fuel economy of light trucks and SUVs
by 50 percent over a comparable gasoline powered vehicle. Two state-of-
the-art diesel engines have been developed that have demonstrated the
fuel economy goal and additional technologies have been developed to
reduce emissions to Tier 2 levels in short-term testing. These
significant advances have paved the way for introduction of advanced
clean diesel engines into the light truck market.
There are no other projects that will have a greater near-term
impact on reducing oil consumption than the successful implementation
of this technology in the light truck market. However, it is felt that
federal R&D funding is no longer needed for these engines as final
product development will be carried out by industry. One major LTE
industry partner is reported to be negotiating the potential production
and use of their advanced clean diesel engines with a major vehicle
manufacturer (see Ward's Auto World, February 1, 2004). The focus of
our efforts is shifting to longer-term higher risk research on advanced
combustion regimes that have the potential for even higher efficiencies
and lower emissions.
Appendix 2:
----------
Additional Material for the Record
Prepared Statement of Dr. Joseph Romm
Author, The Hype about Hydrogen (Island Press, March 2004); Former
Acting Assistant Secretary of Energy
Mr. Chairman and esteemed Members of the Science Committee, I thank
you for the opportunity to submit this testimony. I wish to express my
appreciation for the strong support this committee has shown for clean
energy technology R&D over the course of several decades.
Hydrogen and fuel cell cars are being hyped today as few
technologies have ever been. In his January 2003 State of the Union
address, President Bush announced a $1.2 billion research initiative,
``so that the first car driven by a child born today could be powered
by hydrogen, and pollution-free.'' The April 2003 issue of Wired
magazine proclaimed, ``How Hydrogen can save America.'' In August 2003,
General Motors said that the promise of hydrogen cars justified
delaying fuel-efficiency regulations.
Yet, for all the hype, a number of recent studies raise serious
doubts about the prospects for hydrogen cars. In February 2004, a
prestigious National Academy of Sciences panel concluded, ``In the best
case scenario, the transition to a hydrogen economy would take many
decades, and any reductions in oil imports and carbon dioxide emissions
are likely to be minor during the next 25 years.'' And that's the best
case. Realistically, as I discuss in my new book ``The Hype about
Hydrogen: Fact and Fiction in the Race to Save the Climate,'' a major
effort to introduce hydrogen cars before 2030 would undermine efforts
to reduce emissions of heat-trapping greenhouse gases like carbon
dioxide--the main culprit in last century's planet-wide warming of one
degree Fahrenheit.
As someone who helped oversee the Department of Energy's program
for clean energy, including hydrogen, for much of the 1990s--during
which time we increased hydrogen funding by a factor of ten with the
support of the Committee--I believe that continued research into
hydrogen remains important because of its potential to provide a
pollution-free substitute for oil in the second half of this century.
But if we fail to limit greenhouse gas emissions over the next decade--
and especially if we fail to do so because we have bought into the hype
about hydrogen's near-term prospects--we will be making an unforgivable
national blunder that may lock in global warming for the U.S. of one
degree Fahrenheit per decade by mid-century.
HYDROGEN AND FUEL CELLS
Hydrogen is not a readily accessible energy source like coal or
wind. It is bound up tightly in molecules like water and natural gas,
so it is expensive and energy-intensive to extract and purify. A
hydrogen economy--which describes a time when the economy's primary
energy carrier is hydrogen made from sources of energy that have no net
emissions of greenhouse gases--rests on two pillars: a pollution-free
source for the hydrogen itself and a fuel cell for efficiently
converting it into useful energy without generating pollution.
Fuel cells are small, modular, electrochemical devices, similar to
batteries, but which can be continuously fueled. For most purposes, you
can think of a fuel cell as a ``black box'' that takes in hydrogen and
oxygen and puts out only water plus electricity and heat.
The most promising fuel cell for transportation is the Proton
Exchange Membrane (PEM) fuel cell, first developed in the early 1960s
by General Electric for the Gemini space program. The price goal for
transportation fuel cells is to come close to that of an internal
combustion engine, roughly $30 per kilowatt. Current PEM costs are
about 100 times greater. It has taken wind power and solar power each
about twenty years to see a tenfold decline in prices, after major
government and private-sector investments in R&D, and they still each
comprise well under one percent of U.S. electricity generation. A major
technology breakthrough is needed in transportation fuel cells before
they will be practical.
THE STORAGE SHOW-STOPPER?
Running a fuel cell car on pure hydrogen, the option now being
pursued most automakers and fuel cell companies, means the car must be
able to safely, compactly, and cost-effectively store hydrogen onboard.
This is a major technical challenge. At room temperature and pressure,
hydrogen takes up some 3,000 times more space than gasoline containing
an equivalent amount of energy. The Department of Energy's 2003 Fuel
Cell Report to Congress notes:
Hydrogen storage systems need to enable a vehicle to travel
300 to 400 miles and fit in an envelope that does not
compromise either passenger space or storage space. Current
energy storage technologies are insufficient to gain market
acceptance because they do not meet these criteria.
The most mature storage options are liquefied hydrogen and
compressed hydrogen gas.
Liquid hydrogen is widely used today for storing and transporting
hydrogen. Liquids enjoy considerable advantages over gases from a
storage and fueling perspective: They have high energy density, are
easier to transport, and are typically easier to handle. Hydrogen,
however, is not typical. It becomes a liquid only at ^423+F,
just a few degrees above absolute zero. It can be stored only in a
super-insulated cryogenic tank.
Liquid hydrogen is exceedingly unlikely to be a major part of a
hydrogen economy because of the cost and logistical problems in
handling liquid hydrogen and because liquefaction is so energy
intensive. Some 40 percent of the energy of the hydrogen is required to
liquefy it for storage. Liquefying one kg of hydrogen using electricity
from the U.S. grid would by itself release some 18 to 21 pounds of
carbon dioxide into the atmosphere, roughly equal to the carbon dioxide
emitted by burning one gallon of gasoline.
Compressed hydrogen storage is used by nearly all prototype hydrogen
vehicles today. Hydrogen is compressed up to pressures of 5,000 pounds
per square inch (psi) or even 10,000 psi in a multistage process that
requires energy input equal to 10 percent to 15 percent of the
hydrogen's usable energy content. For comparison, atmospheric pressure
is about 15 psi.
Working at such high pressures creates overall system complexity
and requires materials and components that are sophisticated and
costly. And even a 10,000-psi tank would take up seven to eight times
the volume of an equivalent-energy gasoline tank or perhaps four times
the volume for a comparable range (since the fuel cell vehicle will be
more fuel efficient than current cars).
The National Academy study concluded that both liquid and
compressed storage have ``little promise of long-term practicality for
light-duty vehicles'' and recommended that DOE halt research in both
areas. Practical hydrogen storage requires a major technology
breakthrough, most likely in solid-state hydrogen storage.
AN UNUSUALLY DANGEROUS FUEL
Hydrogen has some safety advantages over liquid fuels like
gasoline. When a gasoline tank leaks or bursts, the gasoline can pool,
creating a risk that any spark would start a fire, or it can splatter,
posing a great risk of spreading an existing fire. Hydrogen, however,
will escape quickly into the atmosphere as a very diffuse gas. Also,
hydrogen gas is non-toxic.
Yet, hydrogen has its own major safety issues. It is highly
flammable with an ignition energy 20 times smaller than that of natural
gas or gasoline. It can be ignited by cell phones and electrical storms
located miles away. Hence, leaks pose a significant fire hazard. At the
same time, it is one of the most leak-prone of gases. Odorants like
sulfur are impractical, in part because they poison fuel cells.
Hydrogen burns nearly invisibly, and people have unwittingly stepped
into hydrogen flames. Hydrogen can cause many metals, including the
carbon steel widely used in gas pipelines, to become brittle. In
addition, any high-pressure storage tank presents a risk of rupture.
For these reasons, hydrogen is subject to strict and cumbersome codes
and standards, especially when used in an enclosed space where a leak
might create a growing gas bubble.
Some 22 percent or more of hydrogen accidents are caused by
undetected hydrogen leaks. This ``despite the special training,
standard operating procedures, protective clothing, electronic flame
gas detectors provided to the limited number of hydrogen workers,'' as
Russell Moy, former group leader for energy storage programs at Ford
Motors has wrote in the November 2003 Energy Law Journal. Moy concludes
``with this track record, it is difficult to imagine how hydrogen risks
can be managed acceptably by the general public when wide-scale
deployment of the safety precautions would be costly and public
compliance impossible to ensure.'' Thus, major innovations in safety
will be required before a hydrogen economy is practical.
AN EXPENSIVE FUEL
A key problem with the hydrogen economy is that pollution-free
sources of hydrogen are unlikely to be practical and affordable for
decades. Indeed, even the pollution-generating means of making hydrogen
are currently too expensive and too inefficient to substitute for oil.
Natural gas (methane or CH4) is the source of 95 percent of
U.S. hydrogen. The overall energy efficiency of the steam methane
reforming process (the ratio of the energy in the hydrogen output to
the energy in the natural gas fuel input) is about 70 percent.
According to a comprehensive 2002 analysis for the National
Renewable Energy Laboratory by Dale Simbeck and Elaine Chang, the cost
of producing and delivering hydrogen from natural gas, or producing
hydrogen on-site at a local filling station, is $4 to $5 per kilogram
(without adding in any fuel taxes), comparable to a price of gasoline
of $4-$5 a gallon (since a kilogram of hydrogen contains about the same
usable energy as a gallon of gasoline). This is over three times the
current untaxed price of gasoline. Considerable R&D is being focused on
efforts to reduce the cost of producing hydrogen from natural gas, but
fueling a significant fraction of U.S. cars with hydrogen made from
natural gas makes little sense, either economically or environmentally,
as discussed below.
Water can be electrolyzed into hydrogen and oxygen. This process is
extremely energy-intensive. Typical commercial electrolysis units
require about 50 kiloWatt-hours (kWh) per kilogram, an energy
efficiency of 70 percent. The cost today of producing and delivering
hydrogen from a central electrolysis plant is estimated at $7 to $9 per
kilogram. The cost of on-site production at a local filling station is
estimated at $12 per kg. Replacing one half of U.S. ground
transportation fuels in 2025 (mostly gasoline) with hydrogen from
electrolysis would require about as much electricity as is sold in the
U.S. today.
From the perspective of global warming, electrolysis makes little
sense for the foreseeable future. Burning a gallon of gasoline releases
about 20 pounds of carbon dioxide. Producing one kg of hydrogen by
electrolysis would generate, on average, 70 pounds of carbon dioxide.
Hydrogen could be generated from renewable electricity, but that would
be even more expensive and, as we will see, renewable electricity has
better uses for the next few decades.
Other greenhouse-gas-free means of producing hydrogen are being
pursued. The Department of Energy's FutureGen project is aimed at
designing, building, and constructing a 270-megawatt prototype coal
plant that would co-generate electricity and hydrogen while removing 90
percent of the carbon dioxide. The goal is to validate the viability of
the system by 2020. If a permanent storage location can be found for
the carbon dioxide, such as an underground reservoir, this would mean
that coal could be a virtually carbon-free source of hydrogen. The
Department is also pursuing thermochemical hydrogen production systems
using nuclear power with the goal of demonstrating commercial scale
production by 2015. Biomass (plant matter) can be gasified and
converted into hydrogen in a process similar to coal gasification. The
cost of delivered hydrogen from gasification of biomass has been
estimated at $5 to $6.30 per kg. It is unlikely that any of these
approaches could provide large-scale sources of hydrogen at competitive
prices until after 2030.
Stranded investment is one of the greatest risks faced by near-term
hydrogen production technologies. For instance, if over the next two
decades we built a hydrogen infrastructure around small methane
reformers in local fueling stations, and then decided that U.S.
greenhouse gas emissions must be dramatically reduced, we would have to
replace that infrastructure almost entirely. John Heywood, director of
the Sloan Automotive Lab at the Massachusetts Institute of Technology,
argues, ``If the hydrogen does not come from renewable sources, then it
is simply not worth doing, environmentally or economically.'' A major
technology breakthrough will be needed to deliver low-cost, zero-carbon
hydrogen.
THE CHICKEN-AND-EGG PROBLEM
Bernard Bulkin, Chief Scientist for British Petroleum, discussed
BP's experience with its customers at the National Hydrogen Association
annual conference in March 2003. He said, ``if hydrogen is going to
make it in the mass market as a transport fuel, it has to be available
in 30 to 50 percent of the retail network from the day the first mass
manufactured cars hit the showrooms.'' Yet, a 2002 analysis by Argonne
National Laboratory found that even with improved technology, ``the
hydrogen delivery infrastructure to serve 40 percent of the light duty
fleet is likely to cost over $500 billion.'' Major breakthroughs in
both hydrogen production and delivery will be required to reduce that
figure significantly.
Another key issue is the chicken-and-egg problem: Who will spend
the hundreds of billions of dollars on a wholly new nationwide
infrastructure to provide ready access to hydrogen for consumers with
fuel-cell vehicles until millions of hydrogen vehicles are on the road?
Yet who will manufacture and market such vehicles until the
infrastructure is in place to fuel those vehicles? And will car
companies and fuel providers be willing to take this chance before
knowing whether the public will embrace these cars? I fervently hope to
see an economically, environmentally, and politically plausible
scenario for how this classic Catch-22 chasm can be bridged; it does
not yet exist.
Centralized production of hydrogen is the ultimate goal. A pure
hydrogen economy requires that hydrogen be generated from carbon-
dioxide-free sources, which would almost certainly require centralized
hydrogen production closer to giant wind-farms or at coal/biomass
gasification power plants where carbon dioxide is extracted for
permanent underground storage. That will require some way of delivering
massive quantities of hydrogen to tens of thousands of local fueling
stations.
Tanker trucks carrying liquefied hydrogen are commonly used to
deliver hydrogen today, but make little sense in a hydrogen economy
because of liquefaction's high energy cost. Also, few automakers are
pursuing onboard storage with liquid hydrogen. So after delivery, the
fueling station would still have to use an energy-intensive
pressurization system. This might mean that storage and transport alone
would require some 50 percent of the energy in the hydrogen delivered,
negating any potential energy and environmental benefits from hydrogen.
Pipelines are also used for delivering hydrogen today. Interstate
pipelines are estimated to cost $1 million per mile or more. Yet, we
have very little idea today what hydrogen-generation processes will win
in the marketplace over the next few decades--or whether hydrogen will
be able to successfully compete with future high-efficiency vehicles,
perhaps running on other pollution-free fuels. This uncertainty makes
it unlikely anyone would commit to spending tens of billions of dollars
on hydrogen pipelines before there are very high hydrogen flow rates
transported by other means, and before the winners and losers in both
the production end and the vehicle end of the marketplace have been
determined. In short, pipelines are unlikely to be the main hydrogen
transport means until the post-2030 period.
Trailers carrying compressed hydrogen canisters are a flexible
means of delivery, but are relatively expensive because hydrogen has
such a low energy density. Even with technology advances, a 40-metric-
ton truck might deliver only about 400 kg of hydrogen into onsite high-
pressure storage. A 2003 study by ABB researchers found that for a
delivery distance of 300 miles, the delivery energy approaches 40
percent of the usable energy in the hydrogen delivered. Without
dramatic improvement in high-pressure storage systems, this approach
seems impractical for large-scale hydrogen delivery.
Producing hydrogen on-site at local fueling stations is the strategy
advocated by those who want to deploy hydrogen vehicles in the next two
decades. On-site electrolysis is impractical for large-scale use
because it would be highly expensive and inefficient, while generating
large amounts of greenhouse gases and other pollutants. The hydrogen
would need to be generated from small methane reformers. Although
onsite methane reforming seems viable for limited demonstrations and
pilots, it is also both impractical and unwise for large-scale
application, for a number of reasons.
First, the upfront cost is very high--more than $600 billion just
to provide hydrogen fuel for 40 percent of the cars on the road,
according to Argonne. A reasonable cost estimate for the initial
hydrogen infrastructure, derived from Royal Dutch/Shell figures, is
$5000 per car.
Second, the cost of the delivered hydrogen itself in this option is
also higher than for centralized production. Not only are the small
reformers and compressors typically more expensive and less efficient
than larger units, but they will likely pay a much higher price for the
electricity and gas to run them. A 2002 analysis put the cost at $4.40
per kg (that is, equal to $4.40 per gallon of gasoline).
Third, ``the risk of stranded investment is significant, since much
of an initial compressed hydrogen station infrastructure could not be
converted later if either a non-compression hydrogen storage method or
liquid fuels such as a gasoline-ethanol combination proved superior''
for fuel-cell vehicles.'' This was the conclusion of a major 2001 study
for the California Fuel-Cell Partnership, a Sacramento-based public-
private partnership to help commercialize fuel cells. Most of a
methane-based investment would also likely be stranded once the
ultimate transition to a pure hydrogen economy was made, since that
would almost certainly rely on centralized production and not make use
of small methane reformers. Moreover, it's possible the entire
investment would be stranded in the scenario where hydrogen cars simply
never achieve the combination of popularity, cost, and performance to
triumph in the marketplace.
In the California analysis, it takes 10 years for investment in
infrastructure to achieve a positive cash flow, and to achieve this
result requires a variety of technology advances in both components and
manufacturing. Also, even a small tax on hydrogen (to make up the
revenue lost from gasoline taxes) appears to delay positive cash flow
indefinitely. The high-risk and long-payback nature of this investment
would seem far too great for the vast majority of investors, especially
given alternative fuel vehicles history.
The U.S. has a great deal of relevant experience in the area of
alternative fuel vehicles that is often ignored in discussions about
hydrogen. The 1992 Energy Policy Act established the goal of having
alternative fuels replace at least 10 percent of petroleum fuels in
2000, and at least 30 percent in 2010. By 1999, some one million
alternative fuel vehicles were on the road, only about 0.4 percent of
all vehicles. A 2000 General Accounting Office report explained the
reasons for the lack of success:
Fundamental economic impediments--such as the relatively low
price of gasoline, the lack of refueling stations for
alternative fuels, and the additional cost to purchase these
vehicles--explain much of why both mandated fleets and the
general public are disinclined to acquire alternative fuel
vehicles and use alternative fuels.
It seems likely that all three of these problems will hinder
hydrogen cars. Compared to other alternative fuels (such as ethanol and
natural gas), the best analysis today suggests hydrogen will have a
much higher price for the fuel, the fueling stations, and the vehicles.
The fourth reason that producing hydrogen on-site from natural gas
at local fueling stations is impractical is that natural gas is simply
the wrong fuel on which to build a hydrogen-based transportation
system:
The U.S. consumes nearly 23 trillion cubic feet (tcf)
of natural gas today and is projected to consume more than 30
tcf in 2025. Replacing 40 percent of ground transportation
fuels with hydrogen in 2025 would probably require an
additional 10 tcf of gas (plus 300 billion kwh of electricity--
10 percent of current power usage). Politically, given the
firestorm over recent natural gas supply constraints and price
spikes, it seems very unlikely the U.S. government and industry
would commit to natural gas as a substitute for even a modest
fraction of U.S. transportation energy.
Much if not most incremental U.S. natural gas
consumption for transportation would likely come from imported
liquefied natural gas (LNG). LNG is dangerous to handle and LNG
infrastructure is widely viewed as a likely terrorist target.
Yet one of the major arguments in favor of alternative fuels
has been their ability to address concerns over security and
import dependence.
Finally, natural gas has too much economic and
environmental value to the electric utility, industrial, and
buildings sectors to justify diverting significant quantities
to the transportation sector, thereby increasing the price for
all users. In fact, using natural gas to generate significant
quantities of hydrogen for transportation would, for the
foreseeable future, undermine efforts to combat global warming
(as discussed below).
Thus, beyond limited pilot stations, it would be unwise to build
thousands of local refueling stations based on steam methane reforming
(or, for that matter, based on any technology not easily adaptable to
delivery of greenhouse-gas-free hydrogen).
THE GLOBAL WARMING CENTURY
Perhaps the ultimate reason hydrogen cars are a post-2030
technology is the growing threat of global warming. Our energy choices
are now inextricably tied to the fate of our global climate. The
burning of fossil fuels--oil, gas and coal--emits carbon dioxide
(CO2) into the atmosphere where it builds up, blankets the
earth and traps heat, accelerating global warming. We now have greater
concentrations of CO2 in the atmosphere than at any time in
the past 420,000 years, and probably anytime in the past three million
years--leading to rising global temperatures, more extreme weather
events (including floods and droughts), sea level rise, the spread of
tropical diseases, and the destruction of crucial habitats, such as
coral reefs.
Carbon-emitting products and facilities have a very long lifetime:
Cars last 13 to 15 years or more, coal plants can last 50 years. Also,
carbon dioxide lingers in the atmosphere trapping heat for more than a
century. These two facts together create an urgency to avoid
constructing another massive and long-lived generation of energy
infrastructure that will cause us to miss the window of opportunity for
carbon-free energy until the next century.
Between 2000 and 2030, the International Energy Agency (IEA)
projects that coal generation will double. The projected new plants
would commit the planet to total carbon dioxide emissions of some 500
billion metric tons over their lifetime, which is roughly half the
total emissions from all fossil fuel consumed worldwide during the past
250 years.
Building these coal plants would dramatically increase the chances
of catastrophic climate change. What we need to build is carbon-free
power. A March 2003 analysis in Science magazine by Ken Caldeira et al.
concluded that if our climate's sensitivity to greenhouse gas emissions
is in the mid-range of current estimates, ``stabilization at
4+C warming would require installation of 410 megawatts of
carbon emissions-free energy capacity each day'' for 50 years. Yet
current projections for the next 30 years are that we will build just
80 megawatts per day.
Since planetary warming accelerates over time, and since
temperatures over the continental U.S. land mass are projected to rise
faster than the average temperature of the planet, a warming of
4+C (over 7+F) means that by mid-century, the
U.S. temperature could well be rising as much per decade as it rose all
last century: one degree Fahrenheit. This scenario, which I am labeling
``The Global Warming Century,'' would be a climate catastrophe--one
that the American public is wholly unprepared for.
In February 2003, British Prime Minister endorsed the conclusion of
Britain's Royal Commission on Environmental Pollution: ``to stop
further damage to the climate. . .a 60 percent reduction [in global
emissions] by 2050 was essential.''
Unfortunately, the path set by the current energy policy of the
U.S. and developing world will dramatically increase emissions over the
next few decades, which will force sharper and more painful reductions
in the future when we finally do act. Global CO2 emissions
are projected to rise more than 50 percent by 2030. From 2001 to 2025,
the U.S. Energy Information Administration (EIA) projects a 40 percent
increase in U.S. coal consumption for electricity generation. And the
U.S. transportation sector is projected to generate nearly half of the
40 percent rise in U.S. CO2 emissions forecast for 2025,
which again is long before hydrogen-powered cars could have a positive
impact on greenhouse gas emissions.
Two points are clear. First, we cannot wait for hydrogen cars to
address global warming. Second, we should not pursue a strategy to
reduce greenhouse gas emissions in the transportation sector that would
undermine efforts to reduce greenhouse gas emissions in the electric
generation sector. Yet that is precisely what a hydrogen-car strategy
would do for the next few decades.
HYDROGEN CARS AND GLOBAL WARMING
For near-term deployment, hydrogen would almost certainly be
produced from fossil fuels. Yet running a fuel-cell car on such
hydrogen in 2020 would offer no significant life-cycle greenhouse gas
advantage over the 2004 Prius running on gasoline.
Further, fuel cell vehicles are likely to be much more expensive
than other vehicles, and their fuel is likely to be more expensive (and
the infrastructure will probably cost hundreds of billions of dollars).
While hybrids and clean diesels may cost more than current vehicles, at
least when first introduced, their greater efficiency means that,
unlike fuel cell vehicles, they will pay for most if not all of that
extra upfront cost over the lifetime of the vehicle. A June 2003
analysis in Science magazine by David Keith and Alex Farrell put the
cost of CO2 avoided by fuel cells running on zero-carbon
hydrogen at more than $250 per ton even with a very optimistic fuel
cell cost. An advanced internal combustion engine could reduce CO2
for far less and possibly for a net savings because of the reduced fuel
bill.
Probably the biggest analytical mistake made in most hydrogen
studies-including the recent National Academy report--is failing to
consider whether the fuels that might be used to make hydrogen (such as
natural gas or renewables) could be better used simply to make
electricity. For example, the life-cycle or ``well-to-wheels''
efficiency of a hydrogen car running on gas-derived hydrogen is likely
to be under 30 percent for the next two decades. The efficiency of gas-
fired power plants is already 55 percent (and likely to be 60 percent
or higher in 2020). Co-generation of electricity and heat using natural
gas is over 80 percent efficient. And by displacing coal, the natural
gas would be displacing a fuel that has much higher carbon emissions
per unit energy than gasoline. For these reasons, natural gas is far
more cost-effectively used to reduce CO2 emissions in
electric generation than it is in transportation.
The same is true for renewable energy. A megawatt-hour of
electricity from renewables like wind power, if used to manufacture
hydrogen for use in a future fuel-cell vehicle, would save slightly
under 500 pounds of carbon dioxide compared to the best current
hybrids. That is less than the savings from using the same amount of
renewable electricity to displace a future natural gas plant (800
pounds), and far less than the savings from displacing coal power (2200
pounds).
As the June 2003 Science analysis concluded: ``Until CO2
emissions from electricity generation are virtually eliminated, it will
be far more cost-effective to use new CO2-neutral
electricity (such as wind) to reduce emissions by substituting for
fossil-electric generation than to use the new electricity to make
hydrogen.'' Barring a drastic change in U.S. energy policy, our
electric grid will not be close to CO2-free until well past
2030.
A 2004 analysis by Jae Edmonds et al. of Pacific Northwest National
Laboratory concluded in that even ``in the advanced technology case
with a carbon constraint. . .hydrogen doesn't penetrate the
transportation sector in a major way until after 2035.''
CONCLUSION
Hydrogen and fuel-cell vehicles should be viewed as post-2030
technologies. In September 2003, a DOE panel on Basic Research Needs
for the Hydrogen Economy concluded the gaps between current hydrogen
technologies and what is required by the marketplace ``cannot be
bridged by incremental advances of the present state of the art,'' but
instead require ``revolutionary conceptual breakthroughs.'' In sum,
``the only hope of narrowing the gap significantly is a comprehensive,
long-range program of innovative, high risk/high payoff basic
research.'' The National Academy came to a similar conclusion.
The DOE should focus its hydrogen R&D budget on exploratory,
breakthrough research. Given that there are few potential zero-carbon
replacements for oil, the DOE is not spending too much on hydrogen R&D.
But given our urgent need for reducing greenhouse gas emissions with
clean energy, DOE is spending far too little on energy efficiency and
renewable energy. If DOE's overall clean energy budget is not
increased, however, then it would be bad policy to continue shifting
money away from efficiency and renewables toward hydrogen. Any
incremental money given to DOE should probably be focused on deploying
the cost-effective technologies we have today, to buy us more time for
some of the breakthrough research to succeed.
The National Academy panel wrote that ``it seems likely that, in
the next 10 to 30 years, hydrogen produced in distributed rather than
centralized facilities will dominate,'' and so they recommended
increased funding for improving small-scale natural gas reformers and
water electrolysis systems. Yet any significant shift toward cars
running on distributed hydrogen from natural gas or grid electrolysis
would undermine efforts to fight global warming. DOE should not devote
any R&D to these technologies. In hydrogen production, DOE should be
focused solely on finding a low-cost, zero-carbon source, which will
almost certainly be centralized. That probably means we won't begin the
hydrogen transition until after 2030 because of the logistical and cost
problems associated with a massive hydrogen delivery infrastructure.
But we shouldn't be rushing to deploy hydrogen cars in the next two
decades anyway, since not only are several R&D breakthroughs required,
we also need a revolution in clean energy that dramatically accelerates
the penetration rates of new CO2-neutral electricity.
Hydrogen cars might find limited value replacing diesel engines (for
example in buses) in very polluted cities before 2030, but they are
unlikely to achieve mass-market commercialization by then. That is why
I conclude neither government policy nor business investment should be
based on the belief that hydrogen cars will have meaningful commercial
success in the near- or medium-term.
The longer we wait to deploy existing clean energy technologies,
and the more inefficient, carbon-emitting infrastructure that we lock
into place, the more expensive and the more onerous will be the burden
on all segments of society when we finally do act. If we fail to act
now to reduce greenhouse gas emissions--especially if fail to act
because we have bought into the hype about hydrogen's near-term
prospects--future generations will condemn us because we did not act
when we had the facts to guide us, and they will most likely be living
in a world with a much hotter and harsher climate than ours, one that
has undergone an irreversible change for the worse.