realitybase - Journal

After hearing Newt Gingrich talk about energy policy, I've upgraded hydrogen powered vehicles from completely nuts to a bad idea that won't be implemented. Newt argues that if a high fraction of our electricity were being generated by nukes, they could generate hydrogen at night when grid demand for electricity is usually lower. Under those assumptions, hydrogen could be cheap and carbon neutral, and one could begin to imagine a hydrogen economy. But here are reasons the assumptions are inadequate.

Even if hydrogen is cheap when generated by a nuke at night because not charged with any of the nuke's capital costs, the savings could be entirely captured as profits to the nuke instead of being passed through as lower prices at the hydrogen refueling station. The retail price of hydrogen will tend to be floored by the costs of the highest-cost hydrogen producer, who may not be using spare capacity but absorbing a full share of capital costs into its hydrogen production costs.

For the nuclear power industry, the prospect of hydrogen is seductive because that could give a nuke a way to follow the grid load and make daytime and intermittent generation from other sources less important. But that prospect is dimmed if direct solar generation (from photovoltaics and/or concentrated solar thermal plants) is widely deployed. Under that scenario, nukes would supply electricity to the grid at a steady rate around the clock, and solar-electric plants would follow the incremental daytime load. Nukes would have less spare capacity—or perhaps no spare capacity—to generate hydrogen cheaply at night. (I tried, unsuccessfully, to find data about diurnal demand variations, which surely vary from place to place and season to season.)

To be the next dominant type of vehicle, hydrogen powered vehicles must out-compete battery powered vehicles, especially plug-in hybrids. If battery vehicles have enough range to serve as a family's primary vehicle, they will generally be recharged at home at night. This would tend to level the demand difference between day and night in the same way that making hydrogen at night would tend to level demand. In a previous post, I pointed out that battery powered cars and hydrogen fuel cell powered cars are competing technologies, both starting with grid electricity and ending with electric motors at the wheels, and that the processes in between give the advantage to batteries over fuel cells.

In summary, Newt's video provides the first explanation I have seen for why hydrogen could possibly be cheap and carbon neutral—it all depends on having a greatly expanded nuclear power industry and a continuing diurnal electricity demand profile. But a lot of other factors would have to go implausibly right also. Hydrogen vehicles are still a Will o' the wisp. Bet on plug-in hybrids instead.

Thanks to Peter for sending me the link to Newt's speech.