PURSUING SUSTAINABLE TRANSPORTATION ENERGY
At its second gathering, the Fuels Institute evaluated alternative
fuel options and expanded its outreach.
BY JOHN EICHBERGER
What will it take for hydrogen fuel cell ve- hicles to gain market share? At what price point will drivers of flex
fuel vehicles purchase E85? What will drive vehicle
and fuel purchasing decisions of tomorrow’s consumers? How are retailers introducing natural gas
to their customers?
These are some of many questions explored
last month during the 2014 Spring Meeting of the
Fuels Institute. This meeting was the second time
Fuels Institute participants gathered in person
to discuss crucial issues facing the fuels market.
The two-day meeting was marked by an extremely high level of engagement and an exchange of
perspectives by those committed to a collaborative
approach for evaluating challenges and opportunities in the marketplace.
Hydrogen, E85 and Natural Gas
The Spring Meeting began with a robust discussion
about the development of a hydrogen transportation
fuels market to power fuel cell electric vehicles. Joe
Gagliano, infrastructure specialist at the California
Fuel Cell Partnership, detailed the effort involved in
his state to bring this new technology to market, noting
the various types of hydrogen retail delivery systems
available and the timeline for vehicle introductions.
Attendees probed for information about the cost
of hydrogen-powered vehicles, cost and characteristics of refueling systems, the overall environmental
implications and the unexpected challenges that
arise from the introduction of a new technology.
What we learned: It currently costs around $2 million to install a retail facility, hydrogen fuel is selling
for about $12 to $15 per kilogram (likely dropping to
$10 as the technology is introduced more broadly).
We also learned that a vehicle refuel will take about
five minutes and deliver 5 to 6 kilograms of hydrogen with a range of 300 to 400 miles. The Fuels
Institute hopes to deepen our understanding of this
alternative fuel with visits to hydrogen refueling
sites during the Fuels Institute Annual Meeting this
November in Southern California.
Following the dialogue on hydrogen, Professor
Bruce Babcock of Iowa State University discussed
his team’s evaluation of the potential for E85 to
assist with compliance of the Renewable Fuel
Standard. Leveraging knowledge of consumer
behavior in the ethanol-heavy Brazilian market, he
created a model that projects potential U. S. demand
for E85 under certain economic conditions. His
work suggests that by optimizing the location
of E85 stations and pricing E85 at a certain
discount relative to E10, it might be possible
to significantly increase the volume of
ethanol sold as E85. The exact value of the
necessary discount needs to be evaluated
more closely in domestic markets.