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DOE's FreedomCAR: Hurdles, Benchmarks for Progress, and Role in Energy Policy
Subcommittee on Oversight and Investigations
Mr. William T. Miller
UTC Fuel Cells (UTCFC) has
more than four decades of fuel cell experience. It is the only company in the
world with a commercial fuel cell product available today with sales of more
than 250 stationary units to customers in 19 countries on five continents. UTCFC
is currently working with the Department of Energy (DOE), as well as car and bus
manufacturers to develop fuel cells for vehicles. From UTCFC's perspective,
DOE's Partnership for a New Generation of Vehicles (PNGV) was a success.
It served as a catalyst for fuel cell technology and led to development
of a fuel cell that operates at ambient or room pressure and the first gasoline
powered fuel cell system that uses pump grade gasoline. FreedomCAR is appropriately
focused on hydrogen fuel cell vehicles to achieve petroleum free, emission free
transportation. It represents a key
element of a comprehensive, long-term national strategy that will enhance energy
security and deliver environmental benefits. This revolutionary concept
will require an evolutionary approach. Personal vehicles are the most demanding
application for fuel cells in terms of cost, size, weight, and performance
criteria. It will therefore take
longer for fuel cells to compete in this market. The evolutionary process will
include stationary power plants by the end of 2003 at a cost of $1,500-$2,000
followed by inner city bus demonstrations in the 2004-2005 timeframe and
commercial availability in 2006. Success in these applications will help drive
towards $50 per kilowatt for the automotive market around the end of the decade.
These milestones are aggressive, but can be met and serve as appropriate
benchmarks for progress. A sustained national
commitment and adequate levels of investment will be required to meet
FreedomCAR's goals. Challenges include technical, market, infrastructure and
public policy hurdles before fuel cell personal vehicles are commercially
available. Technical challenges include
reducing the fuel cell system's cost, size and weight while improving
durability and performance characteristics. Substantial progress has been made, but more work needs to be
done. Hydrogen infrastructure
issues such as production, storage and distribution need to be addressed in
tandem with fuel cell power plant research, development and demonstration
efforts. These efforts must be balanced with support for government
demonstration programs. Extensive involvement by the
supplier base will be necessary to harness innovation and accelerate the pace of
technology deployment for both the fuel cell power plant and hydrogen
infrastructure elements of the program. DOE's FreedomCAR initiative
needs to be coordinated with other key federal agencies such as the Departments
of Transportation and Defense. It should also be integrated with fuel cell
strategies for stationary, inner city bus and fleet vehicles. This will maximize
the synergies that exist and leverage public and private investment. Thank
you Mr. Chairman. I'm Bill Miller, president of UTC Fuel Cells (UTCFC).
I appreciate the opportunity to testify regarding the Department of
Energy's (DOE) FreedomCAR program and the role it plays in national energy
policy. UTC
Fuel Cells (UTCFC) is a unit of United Technologies Corporation, which is a $28
billion global manufacturer of Pratt & Whitney aircraft engines, Carrier air
conditioners, Otis elevators and escalators, Hamilton Sundstrand aerospace
systems and Sikorsky helicopters. UTCFC'S
FUEL CELL EXPERIENCE UTC
Fuel Cells has more than four decades of fuel cell experience.
We've developed and produced the fuel cells for every U.S. manned space
mission since the Apollo missions in the 1960s and continuing today with the
Space Shuttle program. These fuel cells produce the electricity for the orbiter
when it is in space and all the drinking water for the astronauts. We've
also sold more than 250 stationary fuel cell power plants to customers in 19
countries on five continents. Our
installed base of these 200 kW fuel cell power plants, known as the PC25ä,
has accumulated more than five million hours of operating experience. The PC25
provides powers for schools, hospitals, military installations, data processing
centers and other facilities in diverse operating conditions and customer
configurations. Building
on this extensive experience, we are now developing new fuel cell technology for
transportation, commercial and residential applications. UTCFC is working with
DOE and a number of car and bus manufacturers to develop fuel cell power plants
and auxiliary power units for vehicles. Our partners include BMW, Hyundai,
Nissan and Renault for auto applications as well as United Parcel Service, Thor
and Irisbus in the heavy-duty vehicle market. For
example, our hydrogen fuel cells now power four Hyundai Santa Fe Sport Utility
Vehicles (SUVs). These cars are the
world's first zero emission SUVs and get the gasoline equivalent of 50 to 60
miles per gallon. We are a member
of the California Fuel Cell Partnership that is demonstrating fuel cell vehicle
technology, including the Santa Fe, in real world operating conditions. FUEL
CELLS AND PNGV Fuel
cell R&D was funded under the Partnership for a New Generation of Vehicles (PNGV)
effort during the early years of the program. Hundreds of technologies were
evaluated prior to a 1997 "down select" of promising technologies that
included: hybrid electric vehicle drive, direct injection engines, fuel cells
and lightweight materials. From
UTCFC's perspective, PNGV was a success.
It served as a catalyst for fuel cell technology, including UTCFC efforts
with the Ford Motor Company that kicked off our entry into Proton Exchange
Membrane (PEM) fuel cells for transportation applications.
We
had two dramatic technology breakthroughs as a result of this cost shared
program. First,
in cooperation with DOE, we developed a PEM fuel cell that operates at ambient
or room pressure. Why is this
important? This enables our system to achieve substantially better fuel economy
than other automotive fuel cell systems. Our
system does not need a compressor, which can consume large amounts of power and
decrease overall system efficiency. This ambient pressure technology enabled us
to win "best in class" honors in two key performance tests at the Michelin
Bibendum in California last year where new automotive technologies are evaluated
by independent judges. This breakthrough would not have been possible without
cost-shared PNGV funding. Our
second significant accomplishment under PNGV was the development of the first
gasoline powered fuel cell system powerful enough to operate an automobile.
This technology provides an alternative to automakers should the hydrogen
infrastructure take longer than expected to develop by allowing us to use the
existing gasoline infrastructure. UTCFC's
distinction is that its power plant can use readily available, pump grade
gasoline. Other systems rely on specialized de-sulfurized fuel to
accomplish this feat. UTCFC's success in this area is the result of leveraging
its own resources, the resources and other expertise available through our
United Technologies Research Center, as well as funding from the Department of
Energy. FREEDOMCAR/FUEL
CELL HURDLES Today's
FreedomCAR initiative faces hurdles, not the least of which is a sustained
national commitment and adequate levels of investment by the private and public
sector. Other FreedomCAR challenges include technical, market, infrastructure
and public policy hurdles before fuel cell vehicles are commercially available
and DOE's vision of a petroleum free, emission free transportation system is a
reality. Fuel
cells face a number of technical challenges including reducing the system's
cost, size and weight while improving durability and performance
characteristics. We also need to address manufacturing processes and materials
issues. While substantial progress
has been made on many of these fronts, more work needs to be done.
Cost
is a major issue driven by volume as well as a number of technical factors. New
technology, improved manufacturing processes, materials substitution and other
strategies have been used to reduce fuel cell costs over the past two decades
from $600,000 per kilowatt for the unique needs of the Space Shuttle orbiter
application to $4,500 per kilowatt today for UTCFC's current PC25 stationary
power plant with an annual volume of 50 units per year.
We expect to be at $1,500-$2,000 per kilowatt by the end of 2003 with
stationary volumes of 200 units per year, driving towards $50 per kilowatt for
the automotive market when volume approaches one million units per year. Continued
investment in fuel cell core power plant technology is needed to reach these
goals. We believe the government
has a legitimate role to play in supporting high-risk fuel cell core technology
R&D efforts on a cost-share basis with industry so the public at large can
enjoy the efficiency, reliability and environmental benefits of fuel cell
technology. In
addition to these technical challenges, the country also faces significant
infrastructure hurdles such as hydrogen production, storage and distribution.
The goal is to ensure the successful convergence of parallel efforts to
meet fuel cell and hydrogen infrastructure performance goals. A fuel cell
vehicle that meets all the performance targets will have very limited commercial
viability without affordable and widespread access to hydrogen fueling
capability, availability of service technicians to maintain the equipment and
development and adoption of appropriate codes and standards to facilitate
customer acceptance and use. All these issues need to be addressed
simultaneously so there is no "long pole in the tent" holding back
commercialization. Practically
speaking, this means hydrogen production, storage and distribution research and
development efforts must be funded in tandem with research, development and
demonstration efforts for the power plant. This
parallel R&D emphasis on core technology and infrastructure needs to embrace
significant supplier involvement to maximize the opportunity for success. PNGV
drew on expertise from 19 national labs and 400 organizations from 38 states. We
urge that FreedomCAR continue this successful approach by incorporating and
promoting significant involvement by the fuel cell power plant and supplier
base, which we believe will accelerate the pace of technology deployment as well
as generate innovative approaches. It
is essential that we harness the ingenuity, innovation and speed with which the
supplier base brings technology to the market.
For example, a FreedomCAR focus on fuel cell membrane suppliers will help
bring down fuel cell system costs and based on a common
stationary/transportation technology platform, these breakthroughs can be
applied in the near term to buses, fleet vehicles and stationary applications. BENCHMARKS
FOR PROGRESS Our
nation's visionary goal to put a man on the moon first required launching
primates into space. This was followed by manned orbits of progressively longer
flights with more complex missions before the ultimate objective of the manned
moon landing was accomplished. Similarly,
our long-term objective of powering our economy with a renewable source of
hydrogen is a revolutionary concept that will require an evolutionary approach. UTCFC
believes the sequence of this evolutionary process will include first the
deployment of stationary power plants by the end of 2003 at a cost of
$1,500-$2,000 per kilowatt that will start to be competitive in areas with high
electricity costs such as California and New York. This will be followed by
inner city bus demonstrations in the 2004-2005 timeframe and commercial
availability in 2006. These milestones are on track and we believe will occur
spurred by developments in California. Transit
buses are ideal candidates for the initial deployment of fuel cell vehicles.
Hydrogen storage is not a problem because of space availability on the roof of
buses. And hydrogen fueling
stations and technician training can be made available given the relatively
small number of inner city bus stations and service technicians. Since
the automotive application is the most demanding in terms of cost, weight, size,
durability, ease of maintenance, start up time and other performance criteria,
it is understandable that it will take longer for fuel cells to successfully
compete in this market. But as we
gain experience in deploying fuel cells for stationary, inner city buses and
fleet applications, these successes can pave the way for zero emission personal
vehicles and serve as benchmarks to measure progress towards the 2010 goals of
the FreedomCAR initiative. It will be important to balance funding requirements
so the fuel cell and hydrogen infrastructure R&D efforts as well as
stationary and fleet vehicle demonstration programs receive appropriate levels
of support. ROLE
IN ENERGY POLICY The
FreedomCAR initiative is a key element of a more comprehensive strategy to
address heavy-duty vehicles as well as stationary power generation. This
important effort will need to be coordinated with other key federal agencies
such as the Departments of Transportation and Defense. It should also be
integrated with strategies for these other fuel cell applications as indicated
above. This will maximize the synergies that exist and leverage public and
private investment. SUMMARY In
summary, UTCFC believes DOE's FreedomCAR initiative is appropriately focused
on hydrogen fuel cell powered vehicles as a key element of a comprehensive,
long- term national strategy that will enhance energy security and deliver
environmental benefits. Deployment
of stationary fuel cells and inner city buses powered by fuel cells represent
important milestones that will help us measure progress.
R&D efforts should focus on fuel cell as well as hydrogen production,
storage and distribution with the full involvement of the supplier community and
national laboratories. Capturing
and leveraging the synergies between the various fuel cell applications will
maximize taxpayer benefit and accelerate the pace of deployment.
Thank you for the opportunity to testify. I would be happy to respond to any questions.
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