Hydrogen leaves the lab – ChevronTexaco building stations for fueling cars

In a corporate parking lot in Chino, ChevronTexaco Corp. is building what looks like a gas station.

It isn’t, at least not quite. When finished in February, the small structure under a swooping canopy in the San Bernardino County town will dispense hydrogen for fueling experimental cars.

David R. Baker, Chronicle Staff Writer

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ChevronTexaco, the United States’ second-largest oil company, has started exploring hydrogen, the energy source some environmentalists hope will one day replace oil.

San Ramon’s ChevronTexaco won a federal contract earlier this year to build as many as six hydrogen fueling stations to demonstrate how such stations would work. The first, under construction in Chino, will power a small fleet of experimental cars from Hyundai Motor Co., one of ChevronTexaco’s partners on the project.

Another station will be built in Oakland for AC Transit and will fuel three hydrogen-powered buses expected to go into service next fall.

The stations, which will make their own hydrogen on site, represent a vision of the fuel’s future, not a consumer-ready reality. Each will serve a small group of test vehicles, not cars sold on the open market.

Hydrogen faces significant hurdles of technology, logistics and cost before it ever could supplant gasoline. But its advocates claim it has a better chance of replacing petroleum — and ridding the world of oil’s climate-changing waste — than any other alternative fuel on the horizon.

"The expression I have is, ‘If not hydrogen, then what?’ " said Dan Sperling, director of UC Davis’ Transportation Institute. ChevronTexaco is to build a fueling station at UC Davis as part of the project.

ChevronTexaco, of course, profits handsomely from oil. But the company sees one of its other main commodities — natural gas — as a bridge between the ages of oil and hydrogen. Although hydrogen can come from many sources, the new stations in Chino and Oakland will strip hydrogen out of natural gas.

"First and foremost, we’re an energy company, so we’re always going to be looking at, ‘What’s the energy the world needs and in what form?’ " said Greg Vesey, president of ChevronTexaco Technology Ventures. "We look to natural gas as a product we’re going to be producing for a long time, so this fits in with the natural gas strategy."

The system isn’t perfect. Extracting hydrogen from natural gas emits carbon dioxide, a greenhouse pollutant, as a waste product. Still, some environmentalists interested in hydrogen view natural gas as a useful stepping stone.

"That’s probably one of the most economical ways to get the hydrogen infrastructure off the ground," said Roland Hwang, vehicle policy director for the National Resources Defense Council. Like many environmentalists, he would rather see hydrogen produced from water using renewable energy sources such as solar power, once the technology for doing so in large quantities improves.

Natural gas "has to be seen as a transition strategy, not the ultimate source of hydrogen," he said.

Hydrogen’s allure is easy to understand. The universe’s most common element, it is everywhere. Experimental cars that run on fuel cells, which create electricity by combining hydrogen and oxygen, give off no pollution, only water vapor.

"If you can replace diesel (bus) emissions with a zero-emission vehicle that’s also very quiet … then the benefits are phenomenal," said Jaimie Levin, who is spearheading hydrogen technology efforts at AC Transit.

The trick is that hydrogen must be extracted from other substances such as water, coal or natural gas before it can be used.

As concern over global warming mounts, so does interest in hydrogen. Both President Bush and California Gov. Arnold Schwarzenegger have touted it as the future’s fuel. The federal government will spend roughly $228 million on hydrogen research and demonstration projects next year.

Much of that work will be done in collaboration with the private sector.

In addition to ChevronTexaco, other energy companies such as Shell and ConocoPhillips have landed contracts with the Department of Energy to test hydrogen technologies.

BP, the British oil company, has opened a hydrogen fueling station at Los Angeles International Airport in October, with Schwarzenegger bringing a specially designed, hydrogen-burning Hummer to the event.

ChevronTexaco’s federal contract teams the company with South Korea’s Hyundai and UTC Fuel Cells of Connecticut. Together, the three companies will spend about $40 million on the effort, while the federal government will kick in about $37 million.

The project will test technologies needed to run a car on hydrogen as well as fuel it up. UTC will supply Hyundai with its latest fuel cells, which the automaker will install in a fleet of 32 SUVs. ChevronTexaco is building the Chino fueling station at Hyundai’s research facility.

Hyundai will supply some of those fuel-cell SUVs to AC Transit, which will have its own fueling station in East Oakland. The transit system will also have three specially built buses that will run on a combination of fuel cells and batteries.

The government wants car and energy companies to develop different hydrogen technologies, explore the problems and benefits of each and demonstrate how they would work in the real world, said Steven Chalk, hydrogen program manager at the Department of Energy.

"This is validating the technologies coming out of the lab," he said.

ChevronTexaco’s design for the fueling stations in Oakland and Chino differs from a standard gas station in one crucial respect. The stations will produce fuel, not just dispense it.

Each will extract hydrogen from natural gas on site, using a chemical process designed by ChevronTexaco. A light gas that requires significant energy to cool into a liquid, hydrogen is difficult to store and transport.

Not all of the company’s efforts will focus on natural gas. As part of its Energy Department contract, ChevronTexaco will build other stations that use different technologies, including deriving hydrogen from water.

"We’re really entering a phase that’s beginning now, probably lasting five years, in which there will be a wide range of these demonstration technologies and infrastructures out there," said Don Paul, ChevronTexaco’s chief technology officer. "And our view is at the end of that time, a lot of things will sort themselves out — what will work and what won’t."

E-mail David R. Baker at [email protected].