Hydrogen and Public Policy

Hawaii

Nearly 90 percent of Hawaii’s energy is imported from Alaska or foreign sources. This dependence on imported energy puts the state in a particularly vulnerable position to fluctuations in price and supply. As a state with multiple natural renewable energy resources—such as solar, wind, geothermal, and biomass—Hawaii could capture the benefi ts from locally generated energy. For several years, state policymakers have been thinking about how to help Hawaii become independent from imported oil. One result has been an increased support for hydrogen. Jet fuel demand is the most signifi cant driver of overall price and mix of supply at Hawaii’s refi neries. Gasoline and other uses become almost secondary. However, hydrogen’s use as a transportation and stationary fuel source will allow for the decoupling of energy prices for these uses from the
fluctuation of jet fuel supply and demand.

In 2002, the Hawaii Department of Business, Economic Development, and Tourism commissioned the Hawaii Natural Energy Institute and Sentech, Inc.
to conduct a feasibility study. The study concluded that each island might be able to benefi t from hydrogen, using production methods designed to capitalize on the indigenous strengths of each island rather than adopting a single statewide strategy. The life cycle of hydrogen production, distribution, storage, and end-use may seem cost prohibitive compared with current fossil fuel prices on the islands. However, when the fuel efficiency of fuel cell cars (estimated by the report to be 2.2 times that of traditional internal combustion engines) plus the use of local energy sources to generate hydrogen were calculated in the report, prices for hydrogen were found to be on a par with petroleum fuel prices for the state.

In support of the efforts already made by state leaders Hawaii implemented the Energy Policy Act which called for a full assessment of the economic impacts of the state’s oil dependency, including the impacts should fossil fuel supplies expire or be cut. To respond to this assessment, the Act also calls for an island-by-island approach to developing a hydrogen fuel generation system from natural, renewable resources native to the Hawaiian Islands. The Office of Naval Research, the Hawaii Natural Energy Institute, the University of Hawaii at Manoa, and the Naval Research Laboratory have begun the Hawaii Energy and Environmental Technology Initiative (HEETI). This initiative has opened a
state-of-the-art research and demonstration facility to develop and test hydrogen fuel cell technology. The group partners with several private businesses, including
United Technologies Companies, Inc. In addition to HEETI, Hawaii had funded and plans to open a Hydrogen Power Park located on one of its islands. This
facility would develop and demonstrate an “integrated system comprising electrolysis for hydrogen production, hydrogen storage, and a 50 to 75 kW grid-connected fuel cell.” The state may receive additional support from the federal Energy Policy Act of 2003, sponsored by Senator Peter Domenici (R-NM) that includes a line item promoting Hawaii’s energy independence.