US Fuel Cell Council Pushes Congress for $1.17B for Hydrogen, Fuel Cell and Infrastructure Programs

30 December 2008

The US Fuel Cell Council (USFCC), an industry association formed to foster the commercialization of fuel cells in the United State, is asking Congress to put $1.17 billion into fuel cells, hydrogen and infrastructure.

Fully funding programs of the Energy Policy Act of 2005 (EPACT) at levels Congress has already approved for FY2010, and use of other authorized funds, would account for the $1.17 billion. The US Fuel Cell Council would like to see the money applied in six basic areas: deployment programs; development of a refueling infrastructure; learning demonstrations; building domestic manufacturing capability; accelerating public-private research; and investing in fuel cell transit programs.

In addition, the USFCC also proposes two areas without specific dollars attached: Federal fuel cell investment tax incentives; and the inclusion of fuel cells in President-elect Obama’s proposed Energy Initiative.

USFCC’s breakdown of the proposed $1.17 billion in funding is as follows:

• Deployment: $100 million. Dozens of power systems are currently available for commercial and defense applications. The USFCC suggests that Federal policies and federal funds should support public and private sector purchases and leases of fuel cells and infrastructure for stationary, portable and micro fuel cells. Including fuel cells in federal clean energy installation requirements also would accelerate commercialization. Authority: EPACT Sec. 783, FY2010: $100 million for purchases.

• Refueling Infrastructure: $65 million. Federal grants and tax credits for hydrogen and other fuel cell fueling infrastructure would accelerate activity in existing markets like industrial equipment, and prepare communities for the arrival of fuel cell passenger vehicles, the USFCC says. Federal policy should support hydrogen infrastructure deployment via an investment tax credit and by cost sharing for fueling stations, and fully fund the current vehicle Learning Demonstration. Authority: EPACT 2005, Sec. 782, FY2010: $65 million for vehicles and infrastructure.

• Learning Demonstrations: $375 Million. Learning demonstrations put early commercial and advanced experimental systems in the hands of government and private sector users who help evaluate the systems. Federal law already authorizes demonstrations and deployment in civilian and military applications. Authority: EPACT Sec. 808, FY2010: $375 million.

• Domestic Manufacturing Capacity: $100 Million. Especially given the current credit crisis, fuel cell companies and suppliers are finding it difficult to obtain money from banks and investors to invest in manufacturing capacity. The USFCC is calling for Federal grants and tax credits for investment in manufacturing infrastructure. Authority: EPACT Sec. 805, FY 2010:$100 million; EISA 2007 Sections 136; also IRC Sec. 4.

• Research Partnerships: $350 Million. Basic research is needed in advanced materials, catalysis and other relevant fields. Applied research should focus on improved performance and reduced costs, and on improved availability, storage and utility of hydrogen and other fuels for fuel cells. Authority: EPACT Sec. 805, FY2010: $350 million for research.

• Fuel Cell Transit: $180 Million. Transit provisions in the stimulus should include the purchase of at least 100 zero emission fuel cell buses and funds for relevant infrastructure investment. Authority: SAFETEA-LU Bus and Bus Facilities Program.

A July 2008 study by the National Research Council estimated that a total public-private investment of about $200 billion would be required from 2008 to 2023 to support a transition from gasoline to hydrogen fuel cell vehicles, at which point fuel cell vehicles would become competitive with gasoline-powered vehicles. (Earlier post.)

The government cost to support the transition would be roughly $55 billion, according to the study. This funding includes a substantial research and development program ($5 billion), support for the demonstration and deployment of the vehicles while they are more expensive than conventional vehicles ($40 billion), and support for the production of hydrogen ($10 billion).

Private industry would be investing far more, the authors concluded: about $145 billion for R&D, vehicle manufacturing, and hydrogen infrastructure over the same period.

The National Research Council (NRC) functions under the auspices of the National Academy of Sciences (NAS), the National Academy of Engineering (NAE), and the Institute of Medicine (IOM). The four organizations are collectively referred to as the National Academies.