When fuel cells are discussed in the news, the focus is typically on cars. The 60 Minutes news article on Bloom Energy brought to light another important application for this technology: stationary fuel cells.
Fuel cells can be used to power a car, bus, building, or cell phone. Although different types of fuel cells are used for different applications, the basics are the same. Briefly, a fuel cell is a device that converts fuel electrochemically to electricity and heat, with water as the only exhaust. Because the fuel is converted electrochemically, instead of burned, it has a very high conversion efficiency. Some fuel cells can get as high as 87% efficiency when capturing waste heat.
There are several different types of fuel cell technologies, each with their own advantages. Large high-temperature fuel cells used for commercial buildings such as Solid Oxide Fuel Cells (SOFC), Molten Carbonate Fuel Cells (MCFC) or Phosphoric Acid Fuel Cells (PAFC). Polymer electrolyte (PEM) fuel cells are typically used for transportation because they are smaller, lighter, and operate at a lower temperature.
In Japan, there has been considerable growth in smaller residential fuel cell systems built by manufacturers Toshiba, Panasonic, Toyota, Eneos Celltech and Ebara Ballard. Japan has more than 3,000 fuel cells installed since 2008, running on propane, natural gas or kerosene. Testing in Japan has shown that residential fuel cells can:
- reduce fuel consumption by 24%
- CO2 emissions by 39% for a typical household
Fuel cells are still very expensive, where a residential until can cost about $30,000 (USD). Currently residential fuel cells are receiving hefty subsidies in Japan, reducing the cost by about half. The Ministry of Economy, Trade and Industry (METI) residential fuel cell program started in 2004 and provided $100 million in funding through 2008. The program has been extended and has spurred production in Japan.
- Ebara Ballard has announced production goals of 10,000 units a year by 2011
- Toshiba plans to expand production to 10,000 a year by 2012.
Because residential electricity rates are higher in Japan, fuel cells are more cost competitive there than in the US. However, there are some generous subsides in the US. Under the California Self-Generation Incentive Program (SGIP), fuel cells receive a rebate of $4.50 per watt when using a renewable feedstock such as biogas. There is a $2.50 rebate per watt for natural gas fuel cells, up to 3MW in size (reducing in subsidy each MW). The Federal level also has several different tax credits for fuel cells, including a 30% corporate Investment Tax Credit capped at $1,500 per .5kW.
Scott Samuelson of the National Fuel Cell Research Center at UC Irvine says that, “Japan is a decade ahead of the US in the residential fuel cell market.” Even still, fuel cells will need to dramatically reduce in price in order to have a reasonable payback on electricity and hot water use. Industry analysts estimated that the price of a residential unit will drop to $5,000 each, by 2015.
Although fuel cells are still very expensive to produce electricity, they will be essential to providing clean, reliable, distributed energy when intermittent renewables are not able to provide power.