Hydrogen and Public Policy

California

California is the nation’s most populous state and, as the nation’s single largest market for motor vehicles, has an overriding interest in minimizing the impacts of
a car-dependent society. To meet this goal, California has enacted the strictest vehicle emissions standards in the nation. New York, Massachusetts, Vermont, and New Jersey have all adopted similar standards based on California emission laws. It is in this landscape that the state’s hydrogen-related initiatives take shape.

The most prominent hydrogen and fuel cell participant in the state today is the California Fuel Cell Partnership (CaFCP). The CaFCP serves as a focus and catalyst of hydrogen and fuel cell activities for the state. The CaFCP formed in 1999 as a public-private partnership focused on developing fuel cell electric vehicles. Its members include local, state, and federal policymakers; energy companies (BP, ChevronTexaco, ExxonMobil, and Shell Hydrogen); automotive and engine manufacturers (DaimlerChrysler, Ford, GM, Honda, Hyundai, Nissan, Toyota, and Volkswagen); fuel cell companies (Ballard and UTC); transit agencies (AC Transit, Sunline Transit, and Santa Clara Valley Transportation Authority); and other associate partners. Activities range from education and outreach to demonstration projects and support for fuel cell technology development. Although the organization is officially “fuel neutral,” it has proclaimed hydrogen as the “gold standard” fuel source to develop the technology and markets for fuel cell vehicles.

To help this market expand, the CaFCP operates a state of- the-art testing facility at its headquarters in West Sacramento to support the development of fuel cell vehicles by each of the automotive industry members. Since 1999, CaFCP has successfully completed a number of demonstration projects. The zero emissions
bus demonstration sponsored by the CaFCP was completed in late 2001. During the yearlong project, the bus traveled more than 14,900 miles, running for a total of 865 hours. Ballard Power Systems supplied the bus with its fuel cell technology. The zero emission bus completed the 275-mile drive between Los Angeles and
Las Vegas with only one refueling stop and cruising at 75 mph. In 2003, 43 vehicles were on the road, seven buses had been ordered, and seven hydrogen fuel stations existed in the state.

To complement the efforts of the CaFCP, Governor Schwarzenegger campaigned during Fall 2003 on the idea of promoting the construction of an extensive hydrogen fueling station infrastructure in the state by 2010. This project, called “Hydrogen Highways,” is taking shape through state support of private initiatives to build hydrogen fueling stations, though little public money is available for publicly directed projects. The program’s goal is to construct hydrogen fueling stations every 20 miles along major highways in the state. While this is only a fraction of California’s more than 14,000 gas stations, it would allow a consumer to buy a hydrogen fuel cell vehicle without the worry of running out of fuel in the state.

On April 20, 2004, Governor Schwarzenegger signed Executive Order S-7-04 designating California’s 21 interstate freeways as the “California Hydrogen Highway Network.” The California Environmental Protection Agency and other relevant state agencies were directed to work with state legislators and key
stakeholders to plan and build a network of hydrogen fueling stations along these roadways and in major cities, so that by 2010, access to hydrogen fuel will be available throughout California. In addition, a significant and increasing percentage of hydrogen is to be produced from clean, renewable sources. Also, the Executive Order directed that the state develop a California Hydrogen Economy Blueprint Plan by January 1, 2005 for the rapid transition to a hydrogen economy. The plan is to be updated bi-annually thereafter and contain recommendations to the Governor and the State Legislature. Finally, the Executive Order set out a number of other goals for the state to achieve by 2010 relating to the transition to a hydrogen economy.

Since the early 1990s, California’s low and zero emissions fuel standards have dominated the political landscape and shaped the way the retail automotive
business has developed in the state. These standards govern the technology for cars sold and driven in the state and therefore directly affect the private sector.
These standards have become increasingly stringent over time. The California Air Resources Board (CaARB) has established the strictest standards to date for 2004 model year cars. To meet these requirements, public money has been put toward consumer incentive programs.

As part of the ZIP (Zero Emission Vehicle Incentive Program) I and ZIP II programs, motorists who purchase zero or low emission personal vehicles are eligible for rebates of up to $5,000. The newer Fleet ZIP program makes rebates of up to $11,000 available per vehicle to fl eet operators of at least two vehicles. Funding for these grant programs, however, is in question for the state’s 2005 budget. In addition to zero emissions standards, the Clean Gasoline Standard was introduced in California in 1996. State regulation also specifi es the level of sulfur in gasoline and requires it to go through a special desulfurization process before being sold in California.

In June 2004, CARB released a report analyzing the best methods to reduce greenhouse gas emissions from motor vehicles. The report sets out new recommendations on more stringent restrictions to automotive emissions and examines different technologies including hydrogen. The report views hydrogen initially having a small impact in overall emissions as the technology is only in demonstration form. It concludes that long term, hydrogen has the potential to be a signifi cant technology choice in meeting the new proposed standards.

Also actively involved is the California Energy Commission (CEC). The CEC was formed in the 1970s and has been at the forefront of research on the state’s
energy future. While alternative energy is only part of the organization’s portfolio of projects, the CEC has participated in research since its founding aimed at adopting alternative fuel technology. Prominent projects in the past have demonstrated the use of ethanol and methanol, natural gas, and electric vehicles.
While not the focus of alternative fuel vehicles today, there are fuel stations from these projects that still exist around California and could potentially be converted to
hydrogen fueling stations.

Ongoing work of the CaFCP deals with the transportation piece of the equation. However, stationary power and grid reliability are also major concerns for the public and policymakers. The California Stationary Fuel Cell Collaborative (CaSFCC) was formed in 2001 in an effort to think comprehensively about energy, the environment, and reliability in the state of California. Essentially it serves as the stationary version of the CaFCP and seeks to be a catalyst and coordinator of hydrogen and fuel cell activity for stationary applications. This partnership between
federal, state, and non-governmental organizations (including academic institutions) concentrates on promoting the development and dissemination of
stationary fuel cells for distributed generation (DG). As part of the CaSFCC’s active promotion of the California fuel cell market, which they anticipate will comprise between 5 and 25 percent of global market share in coming years, the Collaborative plans to install cells in state government buildings.