Alternative-fuel Vehicles Grab the Spotlight Amid Challenges

LCT Staff
Posted on February 2, 2005

DETROIT – Last month, automakers filled the streets of Detroit with fuel-saving and low-polluting gas-electric hybrids, high-mileage diesels and even exotic hydrogen-fueled vehicles, during the North American International Auto Show.

Ford Motor said it will build more hybrids than announced and do it sooner than planned. General Motors said it is getting closer to real-world hydrogen fuel-cell power.

But each alternative-power vehicle is carrying a heavy load of challenges. Before any of the promising alternatives makes a difference in oil consumption or air quality, prices have to come down, reliability has to be proven, consumers have to be sold, and in the case of hydrogen, cheap, safe and convenient ways have to be found to make, transport and dispense the fuel.

"Internal-combustion engines are here for the foreseeable future," said Mary Ann Wright, director of Ford's hybrid and hydrogen vehicle programs. "There'll come a time when everything's a hybrid; it's inevitable, because of the fuel economy and performance and (air pollution) benefits."

According to an analysis by the Power Information Network, Tom Libby noted: "Nearly 42% of hybrid models sold in the U.S. in the last year were in California. Hybrid prices need to drop to the point where they make economic sense for consumers. Until that time, hybrids will successfully appeal only to fringe groups, including Hollywood stars and ultra-environmentalists."

Automakers said hybrids also appeal to upscale college students, long-distance commuters and people who like the cars' high-tech aspects.

Hybrids' $20,000-something prices sound reasonable, but are $3,000-$4,000 more than consumers would pay for similar gas-powered vehicles. A driver would have to be a traveling salesman or gas prices would have to almost double for a hybrid's lower fuel costs to repay that price premium in the time someone is likely to own the car.

In contrast, improved technology probably can boost efficiency of the conventional gas engine another 25%, "for a cost of maybe $1,000, and that's a hard target to match," said David Cole, chairman of the not-for-profit Center for Automotive Research.

Wright agreed: "Early adopters are willing to pay a premium. But over time, commercial success requires it to be cost-neutral."

Automakers report about 84,000 hybrids were sold in the U.S. last year. According to J.D. Power and Associates' powertrain expert Anthony Pratt, about 220,000 probably will be sold this year. He sees that climbing to 500,000 a year in 2008, then stalling. "We don't think hybrids will appeal to the masses unless gas goes beyond $3.50 a gallon in today's dollars, and we don't think that will happen through 2011," he said.

"If you add up every hybrid made from the beginning of time, it doesn't amount to the (annual) output of one auto plant," Cole pointed out. A big car factory produces 300,000 vehicles a year.

Toyota is planning hybrid versions of most models in the next few years. Honda, which introduced hybrids to the U.S. when it launched its Insight two-seater in December 1999, is going slowly. It has added hybrid versions of its Civic and Accord sedans, but plans no more until a hybrid SUV that's at least three years off.

GM and DaimlerChrysler plan to jointly develop a hybrid system that both say they'll use widely, but not for several years.

Nissan is not interested in investing in hybrids until it can't avoid doing so, partly to meet clean-air regulations in strict California. Its first will be a hybrid version of a redesigned Altima sedan in 2006.

The big stumbling block for hybrids is the cost issue. They require two complete drivetrains — gas and electric — plus complex transmissions to connect the two and sophisticated computer gear to blend their power output smoothly.


It's almost literally everywhere but a little touchy to transport and store. As a gas, its natural state, hydrogen takes up an impractical amount of space. Keeping it as a conveniently compact and energy-dense liquid, though, means chilling it to more than minus-200 degrees Fahrenheit. The alternative is storing it combined with something else — water, for instance, is a mix of hydrogen and oxygen — and that means using a lot of energy to separate the hydrogen when you need it.

"Mass commercialization of hydrogen is maybe 20 years off" because of the challenges, said Ford's Wright.

Hydrogen is useful as fuel in two ways:

• Passing the hydrogen through special membranes that create an electro-chemical reaction, resulting in electricity to run a car motor and emitting only water vapor out the exhaust. That's a fuel-cell system.

• Burning hydrogen directly as fuel in modified versions of the ordinary internal-combustion gas engine. That's less efficient than a fuel cell and doesn't eliminate as much pollution. But it could keep costs down by continuing to use well-known powertrains and chassis instead of converting to electric drive, as fuel cells require.

Hydrogen typically is obtained from natural gas and is commonly used by refiners to make cleaner fuels and higher-octane gasoline. "It's not an especially expensive or energy-intensive process. Hydrogen can be produced on that scale, in a refinery setting, more cheaply than gasoline. The challenge is transporting it to the retail site, because it needs to be cooled," said Phillip Baxley, vice president for business development at Shell Hydrogen.

Transportation and storage costs would make hydrogen, very roughly, twice as expensive as gasoline, but fuel cells are expected to be at least twice as efficient, making hydrogen no pricier overall.

Shell installed a hydrogen tank and pump at one of its gas stations in Washington, D.C., which GM has been using since October to refuel seven D.C.-based fuel-cell demonstration vehicles.

Baxley said that's the first hydrogen pump at a conventional gas station in the U.S. and is "a significant step in bringing hydrogen from the research phase to the reality phase."

Convenient fueling will be a major issue because it's hard to store enough hydrogen on a vehicle to go very far. At the Detroit show, GM displayed its third-generation hydrogen vehicle, the Sequel, which has the best range yet —300 miles. Some gasoline vehicles can go more than 400 miles on a tank.

Toyota's 10 prototype fuel-cell vehicles, based on its Highlander SUV, can go 120 miles between fill-ups. Honda's FCX fuel-cell prototypes can go 190 miles. Ford says its fuel-cell Focuses can go nearly 200 miles, double the range of a previous version.

California and Florida are most active. California has 13 hydrogen fueling stations and about 65 hydrogen-powered vehicles in automaker-backed demonstration fleets, said Robert Hayden, spokesman for the California Fuel Cell Partnership. Governor Arnold Schwarzenegger hopes for 150 stations by 2010.

In Florida, BP is setting up stations around Orlando to fuel demonstration fleets to be run there by car companies.

GM says it would cost $12 billion to modify gas stations to also sell hydrogen fuel at 12,000 sites in 100 big cities.

Hydrogen filling stations for the public aren't likely until 2015-2025, Shell's Baxley said.

"We're in the same phase with hydrogen as when cell phones were expensive and large and only available in the largest urban areas."

LCT Staff LCT Staff
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