The Obama Administration’s 2010 Department of Energy (DOE) budget proposes cutting the federal hydrogen fuel cell research and deployment budget by more than two-thirds ($130 million), eliminating funds for the hydrogen fuel cell vehicle program and market transformation programs. ( Earlier post .)

California Air Resources Board Chairman Mary Nichols met with US Energy Secretary Steven Chu in May and followed up that meeting with a letter, urging the continuation of funding to support research, development and deployment of hydrogen fuel cell vehicles. Nichols is also requesting a follow-on meeting between ARB technical staff, DOE technical staff and the several automakers pursuing fuel cell vehicles to continue the “dialog and investigation”.

In an interview with MIT Technology Review, Secretary Chu made what has become known as the “Four Miracles” comment—essentially that issues with fuel cell durability and cost; hydrogen production; hydrogen storage; and hydrogen distribution infrastructure all required significant development, resulting in “four miracles” that needed to occur before hydrogen fuel cell vehicles would be viable in transportation. This assessment was the basis for his decision to apply the funding in that area elsewhere.

In ARB’s analysis, most vehicles on the road in 2050 will need to be electric drive, or ultra low-carbon fuel vehicles—i.e., electricity or hydrogen—by 2050 in order to achieve the required 80% reduction in greenhouse gases. Commercialization of those technologies must start in the next decade, noted ARB Executive Officer Tom Cackette in a presentation at the recent Advanced Automotive Battery Conference. (Earlier post.)

In her letter to Secretary Chu, Nichols attached a summary response from ARB technical staff responding to each of the Four Miracles.

All promising low-carbon non-petroleum transportation options, including hydrogen fuel cell vehicles, battery electric vehicles, and advanced liquid biofuels in combustion engines, face significant technical, resource, and market challenges. Hydrogen and fuel cells show great potential and have met or exceeded nearly all of the technical milestones set out by US DOE. Several major automakers are pursuing early market testing with consumers beginning this year and are expected to ramp up production to nearly 50,000 vehicles in california by 2017. Ultimately the market will decide which technologies are the winners, but given the critical importance to our long term climate and energy security goals, the best approach is to pursue and invest in a portfolio of the most promising options. —Letter to Secretary Chu

Fuel cell system costs. Source: DOE Hydrogen Program & Vehicle Technologies Program, 2009 Merit Review. Click to enlarge.

Cost. Fuel cell system durability has improved and costs have been reduced through R&D, the ARB staff noted. In volume production, FCVs are expected to be cost competitive with other advanced vehicles, and are approaching the cost of advanced hybrid system even with current designs and high costs of materials.

Recent Department of Energy-sponsored cost analyses have estimated an automotive fuel cell system based on today’s design, including balance of plant, will cost $73/kW at high volume ($6,400 for an 80 kW system). Improvements in system design, including lower catalyst loadings in the fuel cell, are expected to reduce this number further, according to ARB. DOE’s targets are $45/kW by 2010 and $30/kW by 2015.

ARB staff cited a 2007 study by Kromer and Heywood at MIT that found that with minor improvements in system cost, a series-production fuel cell vehicle with a 350-mile all-electric range would cost $3,600 more than a conventional car and $700 more than an advanced hybrid—a lower incremental cost than a plug-in hybrid with 30-mile all-electric range ($4,300 more) and a full battery-electric vehicle (more than $10,000 more).

ARB staff also noted that fuel cell durability has improved dramatically, including free-capable system lasting 1,900 hours in the field in 2008 (up from 950 hours in 2006) and 7,300 hours in the lab.

Well-to-wheels greenhouse gas emissions in 2020. Source: DOE. Click to enlarge.

Production. A well-to-wheels analysis by DOE found that using hydrogen from natural gas—currently the primary production pathway—fuel cell vehicles emit 63% fewer GHGs than today’s gasoline vehicles, and 37% fewer GHGs than natural gas vehicles. FCVs using hydrogen from biomass emit 90% fewer GHGs than current gasoline vehicles, and 63% fewer GHGs than a plug-in hybrid running on cellulosic ethanol, with charging based on the national grid mix.

Storage. While research work continues on developing storage materials with greater capacity, there are already 140 fuel cell vehicles which have accumulated more than 85,000 hours of operation and 1.9 million miles in real-world testing, ARB staff noted. Honda’s Clarity, with 350 bar compressed gas storage is achieving a 280-mile range, and the 2009 Toyota FCHV using 700 bar storage has a state range of 480 miles (on the 10-15 cycle).

A TIAX analysis of system cost presented at the DOE 2009 Merit Reviews earlier this year estimated a cost of $23/kWh (700 bar, down 13% form 2008) and $15.5/kWh (350 bar, down 9% from 2008) for hydrogen storage. Current estimates of Li-ion storage cost are $1,000/kWh, with DOE targeting a cost of $300/kWh by 2014.

Infrastructure. The main question for hydrogen supply and refueling is how much public or private investment will be needed to achieve profitability, ARB staff noted.

When produced and distributed in high volume, hydrogen can be made efficiently from a variety of feedstocks including natural gas, biomass, and coal with sequestration at levelized costs of $3-6/kg, which, when adjusted for the efficiency of the FCV, is comparable to $1.50-%3.00/gallon of gasoline in today’s vehicles.

In assessing a transition to hydrogen fuel cell vehicles, the National Research council estimated it would cost $2.2 million to build a hydrogen fueling station that could support 1,500 FCVs, or $1,500 per vehicle. ARB staff cited an Idaho national Laboratory estimate that the average cost of adding a home 120V, 20A circuit to charge one PHEV would be $878/vehicle, and a 240V circuit needed for a PHEV-30 or PHEV-40 would costs $1,500-$2,100 per vehicle.

The NRC estimated that it will cost less than $600 million per year for all public and private R&D costs plus total vehicle and hydrogen supply costs to sustain hydrogen and fuel cells as a viable option through 2014, ARB staff noted.

Separately, three organizations representing health, environmental and energy policy interests joined four national trade associations in calling on the US Congress to restore funding for the federal hydrogen and fuel cell research and deployment program to FY 2009 levels. The seven groups are the Alliance of Automobile Manufacturers (AAM); American Lung Association (ALA); Electric Drive Transportation Association (EDTA); Union of Concerned Scientists (UCS); The Stella Group, Ltd; the National Hydrogen Association (NHA); and the US Fuel Cell Council (USFCC). (Earlier post.)