At the nuvera fuel cells lab in Cambridge, Massachusetts, 25-year-old chemical engineer Darryl Pollica stands in front of a prototype 5-kilowatt fuel cell — a miniature powerplant that can make most of the electricity needed by a family of four. Its metal skin has been removed to reveal a cubical frame about 5 feet on each side, packed with tanks, valves, and electronics. Conspicuously taped to the outside of the frame is a Nokia cellphone.
“That’s our mascot,” Pollica says. “We want to shrink this,” he says, opening his arms as if to embrace the entire assembly, “to this,” and he brings them together and points toward the tiny phone.
Pollica’s boss, Nuvera Chief Operating Officer Jeff Bentley, a 25-year veteran of the difficult effort to create cost-effective fuel cells that are relatively small, is a bit more cautious. “Maybe,” he says, looking toward Pollica with almost parental amusement. “But it’s going to take a lot of work.”
“We’re optimists,” Pollica shoots back with a confident smile.
They better be. The year 2001 was supposed to be a memorable one for residential fuel cells; instead, it turned out to be one the industry might prefer to forget. In the late 1990s, several manufacturers announced breakthroughs that, by now, were supposed to have brought the price of fuel cells down to around $5,000 — cheap enough that a lot of homeowners could be enticed to buy one to generate most or all of their electricity.
The implications were enormous: Imagine a nation of houses powered by a nonpolluting, domestic source of energy that relies on simple chemical reactions to cleanly and silently produce electricity from hydrogen gas. Hot water and a small amount of carbon dioxide are the only waste.
Nothing happened. During the past four years, H Power, Plug Power, and the Electric Power Research Institute, among others — some of the most bullish residential fuel cell manufacturers and agencies — promised to install prototype fuel cells in houses to convince people that the technology was a practical source of home energy. Only Plug Power came through. In 1998, the Latham, New York-based fuel cell manufacturer put a 5kW prototype system in one nearby home. That alone was enough for The New York Times to declare that fuel cells were “on the verge of a breakthrough” as an economical energy source. Plug was not able, however, to lower manufacturing costs enough to sell the units to consumers. So, two years later, Plug quietly shelved the project.
Such false starts make it tempting to compare fuel cells to photovoltaics, which produce electricity from sunlight-drenched silicon cells laminated behind glass or plastic. Photovoltaics have for decades captured people’s fancy as a simple and environmentally sound electricity solution, but after years of research and development this technology is still too inefficient and expensive for residential use. But fuel cells have an edge over solar power: In addition to investments by a handful of startups, several major corporations are spending more than $1 billion combined annually on fuel cell research. “There has never been funding into photovoltaics and other renewable energy sources that comes close to the amount of money being put into fuel cell development right now,” says Robert Stokes, vice president of research and deployment at the Gas Technology Institute.
Buoyed by that investment, fuel cell manufacturers are not backing down from their hydrogen-tinged vision of the future. They tout the technology as a way to wean the United States off foreign oil (fuel cells extract their hydrogen from U.S.-produced natural gas), and to rid the country of coal-fired and nuclear power plants. They claim fuel cells are a money-saver. People will still have to buy gas, but a fuel cell uses less of it to make a kilowatt of power than does the local utility. And homeowners can save even more money by using the fuel cell’s hot water output in their home heating system. What’s more, some of the most strident optimists believe that most homeowners will eventually be able to sell excess power from their fuel cells back to the local utility.
But before we get there, the matter of cost has to be resolved. So far, no manufacturer has been able to squeeze the price of a 5kW fuel cell below $30,000 — or $6,000 a kilowatt. Most market research indicates that consumers won’t be interested in the technology until it drops much closer to the price of a gasoline-powered home generator, which can deliver 6kW for about $1,400. Given the cost benefit of natural gas over gasoline and the fuel cell’s more efficient extraction technology, experts predict that fuel cells will become attractive when they reach $1,000 a kilowatt — which probably won’t happen for seven to 10 years. And even then, a fuel cell will probably save money only in places where electricity is expensive, such as in New York or California, where utilities are charging more than 9 or 10 cents per kilowatt-hour.
The key obstacles to reducing the price tag are the “stack,” which makes the electricity, and the “reformer,” the miniature chemical plant that separates the hydrogen from the natural gas. Both use platinum as a catalyst to speed up chemical reactions. Not only is platinum expensive — last year, it ranged from approximately $400 to $650 per ounce — but the United States has to import most of its platinum from politically unstable nations. Manufacturers have already reduced platinum content in fuel cell systems by one-eighth during the past five years, primarily by designing systems that require less platinum in the stack and by mixing the platinum with cheaper metals. But to slash fuel cell costs, they need to make even bigger cuts. So manufacturers are now turning their attention to reducing the platinum in the reformer.
Cost issues seem daunting, but only because many people are looking at them erroneously, says Peter B. Bos, CEO of Polydyne, a Pacific Palisades, California-based consultancy that specializes in fuel cell economics. Bos, who’s considered somewhat radical among fuel cell proponents, says the traditional cost projections don’t factor in what he terms the production learning curve, which, simply put, means it can take years of research and lots of money to capture the first 1 percent of the potential market; but lessons learned during that initial effort spur a second, more efficient manufacturing wave, when production rises steeply and prices drop quickly. With that theory as a guide, Bos expects fuel cell price trends to mirror those of VCRs, air conditioners, and heat pumps. He predicts that 1 percent of U.S. homes will have fuel cells between 2006 and 2010, when a 5kW model will cost roughly $7,000. A few years after that, Bos says, fuel cells will cost only $1,200 and be in half of U.S. homes. But his most radical prediction is 29 years out: “By 2031, 99 percent of the homes in the United States won’t need to be hooked up to the electric grid.”
Size may not be as big a hurdle as cost, but it’s imposing nonetheless. To be acceptable to homeowners, manufacturers realize that a 5kW fuel cell system would have to be shrunk to about the size of a small refrigerator — not quite the dimensions of a cellphone but one-sixth as big as they were just a few years ago. Most of the fuel cell’s excess bulk is in the reformer and in pumps, pipes, and electronics. It is possible through more efficient engineering to trim back these components. But the reformer may be more difficult. It also contains the critical heat exchangers, which manage how hot the various chemical reactions get — and there’s a threshold to how small they can be made. “Think of the radiator on your car,” says Nuvera’s Bentley. “There’s no amount of technology you could pour into car radiators to make them one-tenth their current size.”
Durability is also a problem. Along with hydrogen, the fuel cell reformer generates traces of carbon monoxide. Because this latter gas stains platinum as permanently as ink stains cotton, the stack must be replaced every four or five years at a cost of about 10 percent to 15 percent of the system’s price, according to Bentley. The best estimates are that a residential fuel cell can be engineered to run continuously for 10 years, with one stack replacement.
Even 10 years may not be enough for most homeowners, so the notion that fuel cells will put utilities out of business may be off the mark. Instead, it’s possible that if residential fuel cells gain widespread acceptance it will be because they are owned by the local utility or an energy services firm. The homeowner will get a monthly bill and the company will maintain the unit. “We see distributed power, of which fuel cells are a subset, complementing the existing utility business,” says Dan Rastler, area manager for distributed resources for the Electric Power Research Institute, a nonprofit energy research consortium based in Palo Alto, California.
Some utilities won’t even put fuel cells in homes, but will cluster them in substations instead. The Long Island Power Authority recently fired up 75 5kW Plug Power units at a site in West Babylon, New York, to test the concept. They add enough power to the electric grid to run 100 average-size homes.
Success stories like that — as well as the four decades of fuel cells powering NASA spacecraft and the 3-megawatt systems that are being used in dozens of hospitals, wastewater treatment plants, and military bases for backup power — continue to lure developers into the fuel cell business. Among some of the big names that have begun research recently are 3M, DuPont, General Motors, and United Technologies.
Perhaps the biggest thing that fuel cells have going for them is the unpredictability of worldwide energy supplies. An environmental disaster or a geopolitical crisis that sends energy prices skyward could transform the whole equation, making fuel cells not only a relative bargain at almost any price but the most desirable solution overall. “The issues are energy security, energy quality, and environmental quality, and the fuel cell responds to all three of those,” says Bentley. “There’s nothing else like it.”
Fuel for Thought
In December, 1,660 visitors to the Popular Science Web site responded to a poll about residential fuel cells. Here are the highlights:
49% say $5,000 is the most they would pay for a fuel cell that supplies all their electricity; 29% say $3,000 is their limit, while 20% say they’d shell out $10,000.
36% say they’d think twice about powering their home with a fuel cell because of reliability concerns.
14% think homes will be the first place where fuel cells are widely used;
60% voted for automobiles, while 24% chose consumer electronics.
26% believe that electric utilities will be extinct by 2050.