Obama Cancels US$1.2 Billion Hydrogen Car Fund

A planned US$1.2 billion development fund for hydrogen fuel cell-powered cars set up by the former Bush administration has been dumped by US President Barack Obama.

The issue of fuel cells has been a contentious one, with many believing the technology is of dubious benefit when battery-electric cars offer a far simpler solution. The USA's newly-minted President agrees, and last Thursday scrapped the fuel cell funding plan set up by former President George W. Bush in 2003.

Instead, President Obama plans to spend just US$68.2 million on fuel cell research - less than half the amount spent last year. With Bush's US$1.2 billion plan in the bin, a further US$100 million will be saved each year.

In contrast, the Bush administration spent a total of $500 million in automotive fuel cell research, with limited results and no prospect of wide-scale adoption of the technology in the near future.

"The probability of deploying hydrogen fuel-cell vehicles in the next 10 to 20 years is low," US Energy Department spokesman Tom Welch said in an interview last week.

Currently, Honda is the only manufacturer with a fuel-cell vehicle in its stable. The FCX Clarity (above)  is available for lease only in limited numbers in the USA and Japan, with the scarcity of hydrogen refueling infrastructure restricting their use to some areas of California in the US and major metropolitan areas in Japan.

Battery-electrics are the new darling of the Obama administration, with Energy Secretary Steven Chu saying the government wanted to target more "immediate energy-saving solutions".

And target it will. Buyers of all-electric vehicles and plug-in hybrids in the United States are eligible for a Government rebate of US$7500, while the US Energy Department is in the midst of preparing up to US$25 billion in Federal loans for manufacturers of ‘advanced technology vehicles’ - which includes battery-electric cars.

Unlike hydrogen fuel cells, battery technology is simple and uncomplex in its operation. The 'refueling' infrastructure exists in virtually every home and, if generated from renewable sources, entirely emissions-free.

Compared to the energy-intensive hydrogen production process, the considerable difficulties with storing and distributing it and the cost of retrofitting existing filling stations to handle the new fuel, the decision to back battery power is really a no-brainer.