Feb 26 - Knight Ridder/Tribune Business News - Kurt Blumenau The Morning Call, Allentown, Pa.

 

California, long one of America's most car-obsessed states, is emerging as the cradle of what could be the next stage of automotive development -- the hydrogen-powered car.

A growing string of hydrogen fueling stations is opening in California, accompanied by an increasing number of prototype hydrogen-powered cars. Those cars produce little or no pollution, whether the gas is run through special devices called fuel cells or pumped into converted internal combustion engines.

Air Products and Chemicals of Trexlertown, the world's leading hydrogen supplier, is a major player on the California scene. The company has built 14 stations there in the past two years, with more on the way.

"We're getting the lion's share of the stations that are being built," said Ed Kiczek, Air Products' senior business development manager for future energy solutions.

The pumps are largely out of public view so far, with most found at research hubs or in city public works yards. Scientists using those pumps are gathering daily performance data that could help improve both vehicles and stations.

How did California become the hub for hydrogen, and not, say, the Lehigh Valley? California's reputation as a "green," environmentally friendly state plays a part. Also, Gov. Arnold Schwarzenegger has devoted more money and publicity to hydrogen than other state leaders, backing a "Hydrogen Highway" station network of which Air Products' stations are a part.

Not all is sunny on California's hydrogen scene. Serious technological problems still must be solved before the element goes mainstream. Hydrogen is also receding from the public eye, since President Bush, its leading backer, has devoted most of his recent energy speeches to other alternative forms of energy.

Still other challenges could be classed as growing pains. Air Products has worked without success for two years to get a group of partners to sign off on a collaborative research contract with the U.S. Department of Energy. The contract could be worth $91 million.

That delay is not holding back research, all sides say. But it shows how hard it can be to bring together energy companies, car makers and the government -- all necessary partners in hydrogen's growth.

Still, the U.S. government's proposed hydrogen research budget is on the rise, and so are the numbers of cars and stations. Advocates say that's a better measure of success at this early stage than headlines or speeches.

"It's a long-term endeavor, with really long-term sustained benefits," said Patrick Serfass, spokesman for the National Hydrogen Association trade group in Washington, D.C.

Bush put hydrogen on the map in his State of the Union address three years ago, anointing it as America's energy future. He boosted research funding for hydrogen to $1.2 billion over five years, while cutting research money to other alternative fuels.

Hydrogen is among the Earth's most abundant elements, but is almost never found by itself. It is commonly extracted from some other substance, such as natural gas, usually using methods that produce pollution. One challenge facing Air Products and others is to find a clean, efficient, large-scale way to make hydrogen.

Hydrogen is already a $1 billion-per-year business for Air Products, though almost none of it comes from the California research cluster. Oil refineries use hydrogen to remove sulfur from crude oil, making cleaner gasoline. They use so much that Air Products often builds hydrogen plants next to refineries.

By Air Products' standards, the California cluster is small-time. One contract to build five stations for the South Coast Air Quality Management District, a Los Angeles-area pollution control agency, will pay Air Products $3.9 million. That's a drop in the bucket for a company with $8.1 billion in revenue last year.

Of course, Air Products isn't in California for a short-term payout -- just as auto companies such as Toyota, which use its hydrogen stations, don't expect to sell many hydrogen cars soon.