Publication Date:29-May-2005
08:15 AM US Eastern Timezone 
Source:Investors Daily

Consider:

• President Bush doled out $1.2 billion in funds last year to develop hydrogen technology that powers cars.

• Automakers are each spending about $100 million a year, on average, researching hydrogen fuels.

• California Gov. Arnold Schwarzenegger is pushing a plan to create a "Hydrogen Highway" in the state by 2010.

That's what happens when you have a product that can reduce oil dependence and global warming.

Hydrogen gas, made from water and sunlight, can be used to create electricity. The big drawback is it's not easy to use hydrogen.

Companies are striving to perfect a hydrogen fuel cell — sort of like a car battery — that can be used to unleash hydrogen's power.

And they are having some success.

"The leading edge of the Hydrogen Economy is here," said Walter Schroeder, president of Distributed Energy Systems, a small company that is selling commercial hydrogen products.

$1 Million Car

It'll take awhile before hydrogen goes mainstream. People in the field, for example, don't expect to see hydrogen-powered cars being built in volume until 2015 or so.

Prototype hydrogen cars are being made today, but if put up for sale the cost might be "about $1 million," said Schroeder.

On the other hand, some industry executives say hydrogen fuel-cell batteries used to power cell phone towers will be a mainstream product in three years.

Researchers in Australia and the U.S. say they'll have solar panels or other commercial devices in seven years or less that can be used to create cheap hydrogen fuel from water and sunlight.

Hydrogen today is being used to cool — though not power — electric power generators.

This lightest of all known substances has high thermal conductivity. That makes it a good coolant for power turbines. It helps them suffer less heat friction and consume less fuel, which lowers costs for the utilities that use the product.

Schroeder's Distributed Energy Systems, (DESC) based in Wallingford, Conn., makes and sells Hogen, an on-site hydrogen generator that cools power turbines. The refrigerator-shaped devices are made by Proton Energy Systems, a unit of DES.

DES says the Hogen system saves $100,000-$500,000 in operating costs annually per turbine.

Most power plants have three or four turbines.

"You can get more kilowatt hours out of a generator for the same fuel input," said Proton President Mark Murray.

A Hogen costs $60,000 to $150,000, depending on capacity. More than 500 are used in industrial plants and public facilities in 46 countries.

DES also is developing hydrogen fuel cells for cell towers. As cell phone use spreads, demand grows for emergency power systems that can keep these towers running if the power grid goes down.

While the initial use of the hydrogen would be for backup — replacing acid batteries prone to erosion and insect and heat damage — telecom firms see it becoming the main power source.

Schroeder says DES can make that happen in three to five years. "Hydrogen batteries also can make energy and store it until it's needed in an emergency," Schroeder said.

DES, started in 1996, isn't making any green yet, but it's getting closer. In the first quarter, it said its per-share loss narrowed to 13 cents from 19 cents in the year-ago quarter.

Revenue jumped to $9.54 million from $1.95 million.

Solar Hydrogen

Another hydrogen pioneer is Christopher Sorrel. He's director of the Centre for Materials and Energy Conversion at Australia's University of South Wales. Sorrel, who couldn't be reached, hopes to have a commercial solar panel in seven years that makes cheap hydrogen from sunlight and water. The process is known as solar hydrogen.

The solar panel relies on ceramics made from titanium dioxide, a possible key to unlocking hydrogen as a power source.

Such hydrogen generators can create electricity that powers factories and be used as filling pumps for cars.

Cheaper ways to make and handle hydrogen in commercial products are critical in moving to a hydrogen economy. Existing ways to make hydrogen involve using electrolysis in water or "squeezing" it from fossil fuels such as natural gas. The processes are tedious and costly.

Hydrogen is hard to contain and handle. It makes metals like steel brittle and seeps easily from tiny cracks. This makes it tough to use in fuel cells or any device.

And the hydrogen equivalent of a gallon of gas costs around $7 to produce.

But that high price could come down. Schwarzenegger's plan for California involves building a network of hydrogen fuel pumps along major state highways to hasten the adoption of hydrogen fuel-cell cars.

He's secured $50 million in research funds from the U.S. Energy Department and is working to get California companies to pony up as much as $225 million that government agencies would match.