The Hydrogen Economy-After Oil, Clean Energy From a Fuel-Cell-Driven Global Hydrogen Web

More than a year after the terrorist attacks on the World Trade Center Towers and the Pentagon, the world is a more dangerous place than ever before. And, at the heart of our collective fear is the struggle to control oil, the one critical resource without which our global economy and modern society could not exist. Can a combination of technological innovation, global cooperation and strategic thinking take oil off the international chessboard of power politics and replace it with the ultimate energy carrier, lighter-than-air, and potentially non-polluting hydrogen?

By Jeremy Rifkin emagazine.com

We heat our homes and businesses, run our factories, power our transportation and light our cities with fossil fuels. We communicate over distances with electricity derived from fossil fuels, grow our food with the help of fossil fuels and produce our clothes and home appliances with petrochemicals. Indeed, virtually every aspect of modern existence is made from, powered with, or affected by fossil fuels.

In recent months U.S. government concern over the availability of oil in the Middle East has intensified because of the escalating violence between Israel and the Palestinians, the prospect of war with Iraq, and the likelihood of more terrorist attacks by the Al Qaeda network. Now, an even deeper worry is beginning to surface.

Experts have been saying that we have another 40 or so years of cheap recoverable crude oil left. Now, however, some of the world’s leading petroleum geologists are suggesting that global oil production could peak and begin a steep decline much sooner, as early as the end of this decade, sending oil prices through the roof. Non-OPEC oil-producing countries are already nearing their peak production, leaving most of the remaining reserves in the politically unstable Middle East. Increasing tensions between Islam and the West are likely to further threaten our access to affordable oil. Rising oil prices will assuredly plunge developing countries even further into debt, locking much of the Third World in the throes of poverty for years to come. In desperation, the U.S. and other nations could turn to dirtier fossil fuels—coal, tar sand and heavy oil—which will only worsen global warming and imperil the Earth’s already-beleaguered ecosystems.

Rethinking Homeland Security

As horrible as the attacks of September 11, 2001 were, they were symbolic acts on the parts of the perpetrators, designed to destroy the icons of American economic and military power. What has government officials and business leaders in the U.S. and the European Union really worried is the prospect that, next time, Al Qaeda terrorists will strike at the heart of the system, the power grid itself, crippling a large swath of the economy and paralyzing urban society. How justified are the fears?

Unfortunately the power grids in North America and Europe are increasingly vulnerable to disruption by terrorists. Even before the September 11 attacks, government officials worried that American power plants, transmission lines and the telecommunications infrastructure could be targets for terrorists. In 1997, the President’s Commission on Critical Infrastructure Protection issued a warning that cyber-terrorists’ next target might be the computer programs at the power switching centers that move electricity around the country. Disrupting the electrical grid could wreak havoc on the nation’s economic and social infrastructures. Richard A. Clarke, who heads the cyber-terrorism efforts of the Bush administration, warns of an “Electronic Pearl Harbor.” A combination of cyber-attacks and physical attacks could lay waste to the nation’s oil and gas pipelines, power stations and transmission lines with devastating effects on the economy.

Government officials are well aware of the vulnerabilities, but not sure if a system so complex and expansive and so centralized in its command and control mechanisms can ever really be completely secured against terrorist attacks.

Because of all these factors, many, including Christopher Flavin, president of the Washington, D.C.-based Worldwatch Institute, believe that the future belongs to decentralized, renewable energy. Although they acknowledge that fossil fuels will continue to provide energy, and that a transmission and distribution infrastructure will still be necessary to get hydrogen to retail customers, these experts see a renewable future. Flavin points out that the market for oil is growing at less than 1.5 percent per year, while the wind and photovoltaic (PV) markets are now doubling in size every three years.

The “Forever Fuel”

While the fossil-fuel era is entering its sunset years, a new energy regime is being born that has the potential to remake civilization along radical new lines. Hydrogen is the most basic and ubiquitous element in the universe. It is the stuff of stars and, when properly harnessed and made from renewable sources, it is the “forever fuel,” notes author and alternative energy proponent Peter Hoffman. It produces no harmful CO2 emissions when burned; the only byproducts are heat and pure water. We are at the dawn of a new economy, using hydrogen as the energy carrier, which will fundamentally change the nature of our financial markets, political and social institutions, just as coal and steam power did at the beginning of the Industrial Age.

As Hoffman writes in his book, Tomorrow’s Energy: Hydrogen, Fuel Cells and the Prospects for a Cleaner Planet (MIT Press), hydrogen can “propel airplanes, cars, trains and ships, run plants, and heat homes, offices, hospitals and schools….As a gas, hydrogen can transport energy over long distances, in pipelines, as cheaply as electricity (under some circumstances, perhaps even more efficiently), driving fuel cells or other power-generating machinery at the consumer end to make electricity and water. As a chemical fuel, hydrogen can be used in a much wider range of energy applications than electricity.”

Chemically bound hydrogen is found everywhere on Earth: in water, fossil fuels and all living things. Yet, it rarely exists free floating in nature. Instead, it has to be extracted from water or from hydrocarbons. Today, nearly half the hydrogen produced in the world is derived from natural gas via a steam reforming process. The natural gas reacts with steam in a catalytic converter. The process strips away the hydrogen atoms, leaving carbon dioxide as the byproduct (and, unfortunately, releasing it to the atmosphere as a global warming gas). Coal can also be reformed through gasification to produce hydrogen, but this is more expensive than using natural gas and also releases CO2, which scientists hope to keep earthbound through a process called “carbon sequestration.” Hydrogen can also be processed from gasoline or methanol, though again CO2 is an unwanted byproduct.

Although using steam to reform natural gas has proven thus far to be the cheapest way to produce commercial hydrogen, global production of natural gas is likely to peak sometime between 2020 and 2030, creating a second energy crisis on the heels of the oil crisis.

There is, however, another way to produce hydrogen without using fossil fuels in the process. Renewable sources of energy—PV, wind, hydro, geothermal and biomass—can be harnessed to produce electricity. The electricity, in turn, can be used, in a process called electrolysis, to split water into hydrogen and oxygen. The hydrogen can then be stored and later used in a fuel cell to generate electricity, with heat as a useful byproduct that could be harnessed to heat homes, among other uses. Fuel cells run only on hydrogen, but the gas can be derived from many hydrogen-rich sources, including just about any fossil fuel, but only through the use of renewable resources is the whole process emission-free.

People often ask: Why generate electricity twice, first to produce electricity for the process of electrolytic hydrogen and then again to produce electricity and heat in a fuel cell? The reason is that electricity can be stored only in batteries, which are cumbersome to transport and slow to recharge, while hydrogen can be stored at much lower cost. Internal-combustion engines capture only 15 to 20 percent of the energy in gasoline, and the conventional electric power grid is only 33 percent efficient. But as Amory Lovins’ Rocky Mountain Institute (RMI) points out, “Fuel cells can convert 40 to 65 percent of hydrogen’s energy into electricity.”

The real question, then, is one of costs. Wind, hydropower and biomass (generating power by burning plant material such as wood waste and agricultural residue) are already cost competitive in many parts of the world and can be used to generate electricity for the electrolysis process. Wind power, for instance, is now the fastest growing new source of energy; it averages six to eight cents per kilowatt-hour at the wind generator, down from 40 cents in the early 1980s, though collection and transmission costs must be added. PV and geothermal costs, however, are still high and will need to come down considerably to make the process competitive with the natural gas steam reforming process now used most often in the production of hydrogen.

Origins of the Fuel Cell

Hydrogen fuel cells were invented by Sir William Robert Grove (1811-1896), a larger-than-life figure of the type that proliferated in 19th century England. Grove proved that his fuel cells worked, but as he had no entrepreneurial inclinations, and there was no practical use for them at that time, the invention slumbered for over 130 years. It came to life again in the 1960s, when General Electric developed workable proton-exchange membrane cells for use as power supplies in the Apollo and Gemini space missions. The cells were big and very expensive, but they performed faultlessly, delivering an unwavering supply of current as well as a very useful byproduct in space, drinkable fresh water.

Fuel-cell technology can be compared to that of a car battery, in that hydrogen and oxygen are combined to produce electricity. But while batteries store both their fuel and their oxidizer internally, meaning they have to be periodically recharged, the fuel cell can run continuously because its fuel and oxygen are external. Fuel cells themselves are stackable flat plates, each one producing about one volt. The size of the stack determines the power output.

How does a fuel cell work? Pure hydrogen gas is fed to the anode, one of two electrodes in each cell. The process strips the hydrogen atoms of their electrons, turning them into hydrogen ions, which then pass through an electrolyte (which, depending on the type of fuel cell, can be phosphoric acid, molten carbonate or another substance) to the second electrode, known as the cathode. This electron movement produces electric current, the intensity of which is decided by the size of the electrodes. At the cathode, the electrons are brought back together with their ions and combined with oxygen to produce one of the fuel cell’s major byproducts, water. The other byproduct is heat, which can be captured and reused in a cogeneration process.

Peer-to-Peer Energy Sharing

Commercial fuel cells powered by hydrogen are just now being introduced into the market for home, office and industrial use. The major automakers have spent over $2 billion developing hydrogen cars, buses and trucks, and the first mass-produced vehicles are expected to be on the road beginning in 2003.

The hydrogen economy makes possible a vast redistribution of electricity, with far-reaching consequences for society. Today’s centralized, top-down flow of energy, controlled by global oil companies and utilities, can become obsolete. In the new era, every human being with access to renewable

energy sources could become a producer as well as a consumer—using so-called “distributed generation.” When millions of end-users connect their fuel cells powered by renewables into local, regional and national publicly owned hydrogen energy webs (HEWs), they can begin to share energy—peer-to-peer—creating a new decentralized form of energy generation and use.

In the new hydrogen fuel-cell era, even the automobile itself is a “power station on wheels” with a generating capacity of 20 kilowatts. Since the average car is parked about 96 percent of the time, it can be plugged in, during non-use hours, to the home, office or the main interactive electricity network, providing premium electricity back to the grid. As hydrogen visionary Amory Lovins explains, “Once you put a fuel cell in an ultralight car, you then have a 20- to 25-kilowatt power station on wheels. So why not lease those fuel-cell cars to people who work in buildings where you’ve installed fuel cells?”

It would work like this: Commuters drive their cars to work, then plug them into the hydrogen line coming out of the natural gas reformer installed as part of the building’s fuel cell. While they worked, their cars would produce electricity, which they could then sell back to the grid. The car, instead of simply occupying space, would become a profit center. “It does not take many people doing this to put the rest of the coal and nuclear plants out of business,” says Lovins, who’s been trying to do just that for decades. “The hypercar fleet will eventually have five to six times the generating capacity of the national grid.”

The Next Great Economic and Social Revolution

This clean fuel could make obsolete our big-scale, polluting oil network through a locally based system. The first thing to keep in mind is that with distributed generation, every family, business, neighborhood and community is potentially consumer, producer and vendor of hydrogen and electricity. Because fuel cells are located physically at the sites where the hydrogen and electricity are going to be produced and partially consumed, with surplus hydrogen sold as fuel and surplus electricity sent back onto the energy network, the ability to aggregate large numbers of producer/users into associations is critical to energy empowerment and the advancing of the vision of democratic energy.

Empowering people and democratizing energy will require that public institutions and nonprofit organizations—local governments, cooperatives, community development corporations, credit unions and the like—jump in at the beginning of the new energy revolution and help establish distributed generation associations in every country.

Eventually, the end users’ combined generating power via the energy web will exceed the power generated by the utility companies at their own central plants. When that happens, it will constitute a revolution in the way energy is produced and distributed. Once the customer, the end user, becomes the producer and supplier of energy, power companies around the world will be forced to redefine their role if they are to survive. A few power companies are already beginning to explore a new role as bundler of energy services and coordinator of energy activity on the energy web that is forming. In the new scheme of things, power companies would become “virtual utilities,” assisting end users by connecting them with one another and helping them share their energy surplus profitably and efficiently. Coordinating content rather than producing it becomes the mantra for power companies in the era of distributed generation.

Utility companies, interestingly enough, serve to gain—at least in the short run—from distributed generation; though, until recently, many have fought the development. Because distributed generation is targeted to the very specific energy requirements of the end user, it is less costly and a more efficient way to provide additional power than is relying on a centralized power source. It costs a utility company between $365 and $1,100 per kilowatt to install a six-mile power line to a three-megawatt residential customer. A distributed generation system based on renewable energy can meet the same electricity requirements at a cost between $500 and $1,000 per kilowatt. Generating the electricity at or near the end users’ location also reduces the amount of energy used because between five and eight percent of the energy transported over long distance lines is lost in the transmission.

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Europe’s Hydrogen Investment

Romano Prodi, the president of the European Commission, the governing body of the 15-nation European Union (EU), has unveiled the EU’s $2 billion commitment to a renewable hydrogen-based energy economy. Jeremy Rifkin, the author of this piece and an advisor to President Prodi, was the architect of the strategic white paper that launched the initiative.

The aim, Prodi said in U.S. remarks that were covered both by the New York Times and the Wall Street Journal, is to bring industry, the research community and government together to map out the hydrogen future. President Prodi said that the EU’s scientific effort will be as important for Europe as the space program was for the United States in the 1960s and 1970s. The EU has already committed itself to producing 22 percent of its electricity from renewable sources by 2010.

—J.M.

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U.S. power companies are reluctant to make large financial investments in capital expansion because, under the new utility restructuring laws, they can no longer pass the costs of new capacity investment onto their customers. And because the field is now very competitive, power companies are reluctant to take funds from their reserves to finance new capacities. The result is that they put stress on existing plants beyond their ability to keep up with demand, leading to more frequent breakdowns and power outages. That is why a number of power companies are looking to distributed generation as a way to meet the growing commercial and consumer demand for electricity while limiting their financial exposure.

The energy revolution will advance on several fronts simultaneously. Before the hydrogen network can be fully realized, changes in the existing electricity grid will have to be made to assure both easy access to the web and a smooth flow of energy services over the web. That’s where the software and communication revolution comes in. Connecting thousands and then millions of fuel cells to main grids will require sophisticated dispatch and control mechanisms to route energy traffic during peak and non-peak periods. The Windsor, Colorado-based Encorp has already developed a software program for remote monitoring and control that would automatically switch local generators onto the main grid during peak loads when more auxiliary energy was required. Retrofitted existing systems are estimated to run about $100 per kilowatt, which is still less costly than building new capacity.

The integration of state-of-the-art computer technologies transforms the centralized grid into a fully interactive intelligent energy network. Sensors and intelligent agents embedded throughout the system can provide up-to-the-moment information on energy conditions, allowing current to flow exactly where and when it is needed and at the cheapest price. Sage Systems, for example, has built a software program that allows utilities to set back thousands of customers’ thermostats by two degrees with a single command over the Internet if the system is at peak and over-stressed.

Hydrogen Safety

The issue of hydrogen safety inevitably arises, largely because of the spectacular fire that killed 36 people and destroyed the German dirigible Hindenburg. That 1937 disaster put an immediate end to zeppelin travel and saddled hydrogen with a nasty reputation it still carries with it today.

However, The Hindenburg was actually not hydrogen-fueled. The buoyant gas, used because helium was not available to the increasingly bellicose Nazi regime (the famous German airship bore a swastika on each side of its tail), filled 16 cells in the airship’s body and gave it lift. Was the hydrogen on board The Hindenburg responsible for the fire? Conventional history has made that case, but retired NASA engineer Addison Bain, a hydrogen specialist, thinks otherwise. After several years of research that included tracking down surviving pieces of the Hindenburg’s cotton skin, Bain says that the on-board hydrogen certainly fueled the fire, but played no role in igniting it. The culprit, he says, was the highly flammable cellulose-doping compound used to coat the fabric covering and make it taut.

Nonetheless, there are some who speculate that hydrogen is simply too dangerous to ever be safely used for cars. Peter Voyentzie of Danbury, Connecticut’s Energy Research Corporation, which makes large stationary fuel cell power plants, is skeptical about automotive applications. “Hydrogen is a strange beast,” he says. “It’s the smallest molecule, and it leaks out of everything. You also can’t see it burn. In a car, it has to remain stable through collisions and constant agitation. That’s a lot to expect.”

But hydrogen may still be safer than gasoline. When spilled, it simply escapes upward instead of puddling and presenting an ignition hazard. It’s odorless, its flame is invisible, and it emits very little radiant heat. People standing next to a hydrogen fire might not even be aware it’s there. Even in diluted form, hydrogen will burn easily, but unless you’re in physical contact with the fire, it won’t hurt you. Remember, too, that fuel cell cars don’t burn the fuel, though a spark generated in a crash could set it off.

The safety of hydrogen storage tanks for cars is also a concern, with regard to auto accidents. Hydrogen’s safety problems shouldn’t be minimized, but they shouldn’t disqualify the fuel from consideration. Like gasoline, hydrogen can be dangerous. And, also like gasoline, we can learn to use it as safely as possible.

Empowering the Poor

Incredibly, 65 percent of the human population has never made a telephone call, and a third of the human race has no access to electricity or any other form of commercial energy. The global average per capita energy use for all countries is only one fifth that of the U.S. The disparity between the connected and the unconnected is deep and threatens to become even more pronounced over the next half century with world population expected to rise from the current 6.2 billion to nine billion people. Most of the population increase is going to take place in the developing world, where the poverty is concentrated.

Lack of access to energy, and especially electricity, is a key factor in perpetuating poverty around the world. Conversely, access to energy means more economic opportunity. In South Africa, for example, for every 100 households electrified, 10 to 20 new businesses are created. Electricity frees human labor from day-to-day survival tasks. Simply finding enough firewood or dung to warm a house or cook meals in resource poor countries can take hours out of each day. Electricity provides power to run farm equipment, operate small factories and craft shops, and light homes, schools and businesses.

Making the shift to a hydrogen energy regime, using renewable resources and technologies to produce the hydrogen, and creating distributed generation energy webs that can connect communities all over the world, holds great promise for helping to lift billions of people out of poverty. Narrowing the gap between the haves and have-nots requires, among other things, narrowing the gap between the connected and the unconnected. It also presents a significant challenge: developing and harnessing renewable energy sources for hydrogen in countries with no current infrastructure.

As the price of fuel cells and accompanying appliances continues to plummet with new innovations and economies of scale, they will become far more broadly available, just as was the case with transistor radios, computers and cellular phones. The goal ought to be to provide stationary fuel cells for every neighborhood and village in the developing world. Villages can install renewable energy technologies to produce their own electricity, using some of it to separate hydrogen from water and store it for subsequent use in fuel cells. In rural areas, where commercial power lines have not yet been extended, because it is too expensive, stand-alone fuel cells can provide energy quickly and cheaply. After enough fuel cells have been leased or purchased and installed, mini-energy grids can connect urban neighborhoods as well as rural villages into expanding energy networks.

The HEW can be built organically and spread as the distributed generation becomes more widely used. The larger hydrogen fuel cells have the additional advantage of producing pure drinking water as a byproduct, a significant consideration in village communities around the world where access to clean water is often a critical concern.

Distributed generation associations (DGAs) could be established throughout the developing world. Cooperatives, lending institutions and local governments might then view distributed generation energy webs as a core strategy for building sustainable, self-sufficient communities. Breaking the cycle of dependency and despair, becoming truly “empowered,” starts with access to and control over energy.

National governments and world lending institutions need to be pressured to help provide both financial and logistical support for the creation of a hydrogen energy infrastructure. Equally important, new laws will need to be enacted to make it easier to adopt distributed generation. Public and private companies will have to be required to guarantee distributed generation operators access to the main power grid and the right to sell energy back or trade it for other services. And new investment will be needed to confront the remaining technical problems, which are daunting but certainly solvable.

The fossil-fuel era brought with it a highly centralized energy infrastructure, and an accompanying economic infrastructure, that favored the few over the many. Now, on the cusp of the Hydrogen Age, it is possible to imagine a decentralized energy infrastructure, enabling individuals, communities and countries to claim their independence, while accepting responsibility for their interdependence as well.

In the early 1990s, at the dawn of the Internet era, the demand for “universal access” to information and to communications became the rallying cry for a generation of activists, consumers, citizens and public leaders. Today, as we begin our journey into the Hydrogen Era, the demand for universal access to energy ought to inspire a new generation of activists to help lay the groundwork for establishing sustainable communities.

Were all individuals and communities in the world to become the producers of their own energy, the result would be a dramatic shift in the configuration of power. Local peoples would be less subject to the will of far-off centers of power. Communities would be able to produce many of their own goods and services and consume the fruits of their own labor locally. But, because they would also be connected via the worldwide communications and energy webs, they would be able to share their unique commercial skills, products and services with other communities around the planet.

By redistributing power broadly to everyone, it is possible to establish the conditions for a truly equitable sharing of the Earth’s bounty. This is the essence of the politics of re-globalization from the bottom up.

Looking Forward

A more sustainable and equitable future made possible by a worldwide hydrogen web looms on the horizon, but it is as yet woefully unrealized. California, the incubator of the American hydrogen industry, has only two hydrogen filling stations, and there are less than 12 in the entire U.S. There are only a few fuel-cell cars, all million-dollar prototypes. Although the auto industry is making rapid progress in developing automotive fuel cells, it has lobbied heavily against fuel cell-enabling clean car legislation, particularly in California. A lawsuit filed by an industry association has delayed by two years implementation of a law that would have required clean car fleets in California by 2003.

At the same time, incredible progress is being made. The federal FreedomCAR program, designed to promote fuel-cell vehicles, was announced in January 2002. The government’s efforts could be hijacked by big energy concerns (see sidebar), but federal funding for hydrogen research has won qualified support from environmentalists. And much is happening on the state level, too. Ohio, for example, just opened its first hydrogen pumping station, and plans three more as part of a $100 million, three-year fuel-cell initiative announced by Governor Bob Taft. Last April, Governor John Engler of Michigan announced a plan called NextEnergy that includes creation of a 700-acre state-owned campus that will be a tax-free high-tech center for hydrogen innovation. Carmakers are also making commitments: Honda, for instance, says it will have 20 to 30 fuel-cell vehicles on the road for testing purposes in the next two years.

Although national marketing of home-based fuel cells for decentralized power generation is planned by Plug Power and other companies, there are remaining cost problems (see sidebar) and many other questions remain. Will we fill up our hydrogen cars at home-based systems, developed by Stuart Energy, Avalence and others, or will the corner gas station become the corner hydrogen station? From what energy sources will hydrogen be made? Agreement on the broad outlines of a national and international hydrogen infrastructure is desperately needed. Will the new regime be imposed from the top down, or the bottom up?

The hydrogen economy is within sight. How fast we get there will depend on how committed we are to weaning ourselves off of oil and the other fossil fuels. What are we waiting for?

JEREMY RIFKIN is president of the Foundation on Economic Trends and the author of such works as The End of Work, The Biotech Century and The Age of Access. His latest book is The Hydrogen Economy: The Creation of the Worldwide Energy Web and the Redistribution of Power on Earth (Tarcher Putnam), from which this article is excerpted.

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