People have been talking about a hydrogen economy for many years, one driven by the cheapest, most common, nonpolluting element in the universe. This dream may become reality in this decade as hydrogen fuel cell development nears the production stage.

Contractors who learn about this new technology can ride its potential wave of profits. Several big international companies, as well as startups and government laboratories, are announcing major developments daily.

Part I of this two-part article answers some frequently asked questions. Part II, which will run next month, will include some practical case studies and recommendations.
Coming tidal wave?

“Fuel cells are not just the wave of the future, they are the tsunami of the future, and the electrical contracting industry is well positioned to ride the crest,” according to Greg Dolan, deputy executive director of the U.S. Fuel Cell Council (e-mail: Electrical contractors can be major players in this emerging and exciting marketplace.

Fuel cell technology will most benefit “early adopters”; that is, contractors with the intuition to see around corners and recognize potential profit-making opportunities before their competitors. However, several cost hurdles need to be overcome for this technology to be commercially profitable and competitive with fossil fuel generation.

“It’s the ‘second coming’ for the electric utility industry,” said William Cratty, president of Sure Power Corporation, Danbury, Conn. (

Sure Power has been in operation for just over two years, specializing in power quality applications. Its enviable performance record bears testimony to the rapidly expanding fuel cell marketplace. Sure Power’s recent installation of an ONSI Corporation fuel cell as the core of an 800 kW power system for the First National Bank of Omaha was carried out by Commonwealth Electric, a Lincoln, Neb.-based contractor with branches in Iowa, Minnesota, and Arizona. This project will be discussed in Part II of this article.

The chemical process employed in fuel cells is based on the principal of electrolytic charge exchange between a positively charged anode plate and a negatively charged cathode plate. When hydrogen is used as fuel, a reverse hydrolysis occurs, yielding only water and heat as byproducts while converting the chemical energy into direct current electricity. Sir William Grove made this chemical discovery in 1839, but it wasn’t until the 1960s that the first commercial applications were made feasible with the U.S. space program.

Proton exchange membrane (PEM) fuel cells are what power the space shuttle. Although they have been far too expensive to compete with electricity generated from burning oil, gas, or coal, and even nuclear sources, that situation is changing rapidly.

Leading developers’ and the U.S. Department of Energy’s efforts over the last several years are making the technology more cost competitive for specialized commercial applications. Applications on the verge of commercial introduction include transportation, stationary generation, and portable power sources. Most profits are earned in the early stages of a new business opportunity before everyone else jumps into the market and depresses prices and profits with excessive supply. This is the present stage of development of fuel cell power generators.

Those contractors that help to create the market for these revolutionary devices will likely reap the greatest profits. If you are looking for new ventures and can invest a little time and effort in self-education over the next couple of years, you may find this article to be profitable soon. What follows are answers to frequently asked questions that will increase your interest in this breakthrough technology and get you started toward your new career in fuel cells.

What is a fuel cell?

A fuel cell is a power-generating device that combines the energy in hydrogen of a fuel such as natural gas, methanol, ethanol, or gasoline, with the oxygen in air to produce direct current electricity. Fuel cell construction generally consists of a fuel electrode (anode) and an oxidant electrode (cathode) separated by an ionconducting membrane. (See figure for reference.)

How does a fuel cell work?

Hydrogen is fed into the anode and oxygen enters through the cathode. A catalyst (platinum) helps split the hydrogen atom into a proton and an electron, which take different paths between the anode and cathode. The proton passes through an electrolyte, while the electron creates a separate current that can flow through an external circuit before reuniting with the cathode, where it recombines with the proton to form a molecule of water.

A fuel cell that includes a fuel reformer can obtain hydrogen from any hydrocarbon fuel such as methanol, ethanol, natural gas, and gasoline. Some types of fuel cells require that hydrogen in a pure form be provided. (Texaco has invested $67 million in Energy Conversion Devices, Inc., in hopes of developing a cheaper way of making storage and use of hydrogen safer in use for fuel cells.)

Unlike a battery that must store depletable energy internally, a fuel cell keeps on producing power so long as fuel is injected. An individual fuel cell produces only a small voltage and current; therefore, many are normally stacked together for creating usable amounts of power, up to 3 mW and more. Since the output is DC, an inverter circuit is used to convert it to AC power.

How big is the market for fuel cells?

Actual figures for commercial sales are quoted in the $500 million range now, although forecasts are very speculative, ranging into the high billions of dollars. A new study from the Freedonia Group ( reports that the demand for fuel cells in the U.S. market will rise fourfold through the year 2004 to $2.4 billion. Explosive growth is forecasted thereafter, with the market reaching $7 billion by 2009. Fuel cell industry activity is expected to shift rapidly from product development, test marketing, demonstration, and prototyping to the actual sale of finished products to real-world customers. Early sales will possibly be in niche markets, but mainstream use could follow shortly.

Much depends upon meeting the chicken-egg challenge of simultaneous low-cost manufacturing breakthroughs and increasing commercial demand. The growing demand will increase production and thereby lower costs, and lower costs will stimulate demand. Since the market is just being formed, contractors have a golden opportunity to get involved before others establish their positions. Contractors could play a leading role in successful growth if they help promote fuel cell use with their customers and show their interest in partnerships with emerging suppliers.

Electric utilities, gas suppliers, and manufacturers will be natural allies with mechanical contractors and standby generator dealers. Smart electrical contractors will begin aligning with these groups, positioning themselves to do the installation wiring and service work as it develops. They might also become value-added resellers to end-users. To get involved, you might register with the aforementioned Fuel Cells Matchmaking group on the Fuel Cells 2000 Web site and engage in e-dialogue.

Why do fuel cells cost so much?

Currently, electricity generated by fuel cells can be 10 times the cost of conventional generation. One reason is the low production volume. As demand increases, prices are expected to drop dramatically. Another reason is that exotic precious metals such as platinum are being used as catalysts in the process of reforming hydrogen from other compounds.

However, work at the Argonne National Laboratory (ANL) has resulted in alternatives that could reduce both size and costs of the reactor. Researchers were able to use a new method of producing the catalyst that would reduce the platinum load while retaining activity. In just two years, ANL has reduced the amount of platinum required for a 50kW reactor by 93 percent. Researchers have also identified a nonprecious metal/mixed oxide that is a potential alternative to the current platinum/mixed oxide. This catalyst would cost just 1 percent of what the platinum catalyst would. Some experts estimate fuel cell power will be fully competitive in less than 10 years.

What types of fuel cells are being developed?

Fuel cells are characterized chiefly by the form of electrolyte used between the anode and cathode, serving as the bridge for ion exchange.

Six main versions are being commercially tested: phosphoric acid, proton exchange membrane, molten carbonate, solid oxide, alkaline, and direct methanol fuel cells.

What are some applications for fuel cells?

Fuel cell applications can be categorized into those for portable uses, transportation, and stationary plants. The latter are the most likely to provide opportunities for electrical contractors. However, fuel cells are being used in applications ranging from small units to power cell phones and personal computers, through devices that power electric vehicles, to 5 to 7 kW units for residential use, up to 250 kW units that can power 200 homes, and even central plants of 3mW and higher that distributed power generation utilities for 2,000 homes and businesses can use.

What are the expected benefits of fuel cells?

Use of fuel cells could reduce U.S. dependence upon foreign oil supplies, which is much higher now than during the oil crisis of the 1970s. Fuel cells could dramatically reduce air pollution and reduce trade deficits, while producing more American jobs. Consulting firm Arthur D. Little predicted that 800,000 new jobs could be created if only 20 percent of autos were powered by fuel cells. Since they produce only water vapor in addition to electricity, their clean operation is a primary advantage to environmentalists. Reliability and dependability also appear to be primary benefits in applications where users cannot tolerate momentary power disruptions. Supplying economical power internationally in areas without established power transmission grids also poses exciting possibilities.

Who produces fuel cells?

A wide ranging group of international companies and relatively small new firms are involved. The U.S. Fuel Cells Council provides a list of firms, complete with links to company Web sites. Two of the most prominent traditional electrical manufacturers heavily involved in fuel cells are GE and Siemens-Westinghouse. GE is partnered with Plug Power ( and plans to offer residential fuel cells in states with deregulated power markets in 2001 through a network of selected resellers. (See the Web site at

Siemens-Westinghouse is partnered with the U.S. Department of Energy to develop solid oxide fuel cell applications.

Another major player is International Fuel Cells, a division of United Technologies Corporation (UTC) and composed of ONSI Corp. and International Fuel Cells, LLC ( UTC has been supplying fuel cells to NASA, which have produced electricity and water in space shuttles since the 1960s. ONSI has delivered over 200 commercial units of its PC25 250 kW stationary models worldwide in 84 cities. A leader in stationary generators is Fuel Cell Energy, Inc. It plans to have commercial models ready for delivery in late 2001 at 300kW, 1.5mW, and 3mW capacities ( These and other companies, including Daimler/Chrysler, DuPont, General Electric, Honeywell, Siemens-Westinghouse, DTE Energy, KeySpan Energy, NiSource, and Sempra are investing nearly $1 billion annually to make fuel cells a commercial reality in the next few years.

How quickly will fuel cell markets develop?

Auto makers have announced plans to market fuel cell-powered commercial vehicles in two years and private autos in four years. Government timetables call for commercial marketing of stationary fuel cell plants in 2004. The U.S. Department of Energy (DOE) is investing about $100 million annually to spur commercial marketing plans by accelerated beta testing in several applications. For fiscal year 2001, the federal budget includes these DOE items: $42.2 million for stationary fuel cells, $41.5 million for transportation fuel cells, $5.5 million for cogeneration fuel cells, and $23 million for developing a hydrogen infrastructure. Commercial development of stationary applications is assigned to the National Energy Technology Laboratory of DOE (

TAGLIAFERRE, is proprietor of the C-E-C Group in Springfield, Va.He can be reached at (703) 321-9268, or by e-mail at GREENWOOD has been a lecturer with the University of Maine’s Department of Sociology for 13 years. She can be reached at or (207) 581-2394.