In the late 1950s, spacecraft needed a power source, and NASA scientists, at least, knew that fuel cells were both safe (they have no combustion) and efficient (no friction). Money being no object in the space race, fuel cells’ high cost didn’t deter the agency. And as Scott Samuelson, director of the National Fuel Cell Research Center at the University of California-Irvine put it to me, “fuel cells fortuitously produce an effluent which is desirable in space applications, namely water.”
After Jimmy Carter created the Department of Energy, fuel cells got their second big boost. People were just beginning to think about fuel cells bigger than the ones powering the lights, computers, and climate-control systems in spacecraft—big enough to operate a power plant. One giant leap for fuel cells came when it was discovered that a carbonate electrolyte in the middle of the sandwich could operate at a high enough temperature that the same catalysts providing electricity could also supply the heat necessary to turn the methane-steam mixture into hydrogen.
Today, Samuelson says, “there’s nothing holding back fuel cells technology-wise.” Market demand is changing. New EPA regulations are expected to effectively prevent construction of any new coal-fired power plants. Fuel cells are more expensive than plants burning natural gas—around $5 million per megawatt, compared to $1 million for a combustion plant—but fuel cells offer several attributes combustion plants don’t.
For one thing, if you’re running fuel cells on waste biogas, the biggest cost of operating them—fuel—is built in to the purchase price. The falling price of natural gas—from $15 to $6 for a million BTUs just in the last few years—has driven fuel cell growth, but even if it rises again, waste biogas could conceivably be compressed at water treatment facilities and trucked to fuel cells in the urban core.
For another, they’re smaller than other alternative energy technologies. A wind farm producing 15 megawatts requires around 75 acres of space; Fuel Cell Energy has a plant that powerful in Connecticut situated on just more than an acre. So if you’re a downtown hospital, server farm, or university lab needing energy that can be your base as well as your backup in the event of a blackout, a fuel cell plant is a good option. Customers like these don’t need 200 megawatts of electricity—the smallest practical size for a natural gas-combustion plant—but they do need heat, so a fuel cell stack is ideal.
Wind and solar farms tend to be far from where most of the electricity they provide is used; new wind or solar therefore means new transmission lines, and transmission is the bete noire of any utility agency. Dave Freeman, who has headed the Los Angeles Department of Water & Power, the Sacramento Municipal Utility District, and the Tennessee Valley Authority, told me that in his experience, bringing power plants online is the easy part. “The hardest thing to get built,” he says, “is transmission lines.”
Samuelson says that fuel cell manufacturers are starting to establish their credibility and performance so investors can be assured the technology does what it’s supposed to. “Fuel Cell Energy is starting to provide that level of confidence,” Samuelson says, “and it’s now at a tipping point where the industry can proceed.”
The efficiency and environmental attributes reduce the costs of producing electricity, making fuel cells more attractive. Incentives such as a feed-in tariff, which establish a price at which a distributed generation power station can feed excess power into the grid, also helps, as do policies like the one in South Korea, where regulators have set the price of clean energy below electricity produced from fossil fuels. In November, a South Korean consortium purchased 121 megawatts of fuel cells from Fuel Cell Energy, and there’s no reason a utility can’t keep stringing fuel cell stacks together until they produce as much power as a nuclear plant.
As more customers sign up, Leo says, the company can lower its price. “When we get to four times our current volume of production,” he told me, “our cost is low enough that we can compete without incentives.” The company expects that to happen in the next few years.
“Fuel cells are very well positioned to meet all three of the nation’s goals regarding electricity,” Samuelson said. “Cheap energy that’s efficient, reliability, and reduction of emissions.”
When we spoke, he was driving a fuel-cell powered vehicle to an installation in Orange County that provides heat, electricity, and transport fuel with hydrogen made from biofuel.