Hydrogen Cars Will Need Multi-Billion Dollar Jumpstart, Experts Warn

WASHINGTON, DC, July 18, 2008 (ENS) - It will take massive subsidies from the U.S. government to make hydrogen fuel cell vehicles a significant part of the nation's transportation future, according to a National Research Council report released Thursday. The study finds that even under a best-case scenario only about two million hydrogen fuel cell vehicles will be on American roads by 2020, less than one percent of the nation's estimated total number of cars and trucks.

Achieving that goal would require the government to pump at least $55 billion in subsidies over the next 15 years to make hydrogen vehicles cost competitive with conventional cars and trucks, the report concluded. Current government spending has equaled some $879 million since 2004.

But the chair of the committee that wrote the report said the suggested government funding should be put in perspective with other subsidies.

If current funding and policies continue, the federal subsidy for corn-based ethanol over the same time period is on pace to reach $160 billion, said Mike Ramage, a former vice president for research and development at Exxon Mobil and chair of the 17-member panel. "We need durable, substantial and sustainable government help to make this happen, just as there is for ethanol," he said.

The 249 page report, which was requested by the U.S. Energy Department, contends that the funding may well be worth it as it could set the stage for accelerated adoption of hydrogen vehicles by mid-century. The allure of hydrogen fuel cells is their potential to help shift the U.S. transportation sector away from oil and to cut emissions linked to climate change. The only byproduct from a hydrogen fuel cell is water.

The environmental benefits of hydrogen would be "less in the early years but would be dominant" over a longer time period, Ramage told reporters on a telephone briefing.
The committee's best case scenario envisions that if the technical and economic obstacles are overcome in the next 15 years, the growth of the technology could accelerate dramatically.

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Latest Honda Runs on Hydrogen, Not Petroleum

On Monday, Honda Motor celebrated the start of production of its FCX Clarity, the world’s first hydrogen-powered fuel-cell vehicle intended for mass production. In a ceremony at a factory an hour north of Tokyo, the first assembly-line FCX Clarity rolled out to the applause of hundreds of Honda employees wearing white jump suits.

Honda will make just 200 of the futuristic vehicles over the next three years, but said it eventually planned to increase production volumes, especially as hydrogen filling stations became more common.

Honda said even the small initial production run represented progress toward a clean-burning technology that many rejected as too exotic and too expensive to gain wide acceptance.

But the technology has faced many hurdles, not the least of which has been the prohibitive cost of the fuel cells themselves. Honda says it has found ways to mass produce them, which promises to drive down costs through economies of scale. On Monday, it showed reporters its fuel-cell production line, which resembled a semiconductor factory more than an auto plant with its humming automated machinery and white smocked workers in dust-free rooms.

Click here for the full NY Times article.