Fuel Cell System Cost Reduction

Identifying real examples of cost reductions in the fuel cell field is difficult given the limited numbers of units in service and the increase in production experience to date. However, evidence from the Japanese Ene-Farm project over the past few years provides examples of what has been achieved by leading businesses in the field. Both Panasonic and Toshiba have made public announcements in the past 

Panasonic, with Tokyo Gas, announced in January 2013 that it had reduced the price (excluding installation) of its domestic PEM fuel cell system to 1,995,000 by approximately 760,000, a reduction of 27.5 % from its 2011 model. This itself was a reduction from its 2009 model (selhng at 3,465,000 [104]) of 20 %. A year or so earlier in January 2012 Toshiba, with Osaka Gas, announced that it had reduced the price of its domestic fuel cell system by 650,000- 2,604,000, a 25 % reduction in cost [105]. In both cases sales increases were anticipated and further cost reductions expected. The Panasonic announcement also included further information on the performance and other aspects of the unit. The cost reduction was associated with an improvement of lifetime from 50,000 to 60,000 h a reduction in components by 20 % reduced weight by 10 % and reduced size overall. Of significance was a reduction in noble metals in the fuel processing subsystem by 50 % and platinum catalyst by 50 %. Total efficiency, both heat and power, was calculated at 95 % LHV. 

It is evident that cost reductions are possible over time, but that they are not simply a function of numbers of units produced and installed, or technology improvements, but a mix of both production increases and technology and product improvements, made by it should be added, experienced and capable businesses. 

One means to address the issue of the current overly expensive stationary fuel cell systems is to provide some form of financial support from the public sector. Public support is an important early market incentive for stationary fuel cells systems, be this in the form of capital subsidies (e.g.. North Rhine-Westphalia in Germany [106]) or capital support and feed-in-tariff style pricing (e.g.. South Korea [107]) or capital and other incentives available in the USA, usually at the State level, where incentives vary up to 5500/kWe. This support goes some way toward negating the higher prices of stationary fuel cell systems when compared with competitive systems. 

There are markets where the relatively high cost of fuel cell systems, be it residential or commercial, can be justified on the basis of the additional value associated with green credentials or other benefits. In Japan under the Ene-Farm program subsidies are available for the sale of residential CHP fuel cell systems. 

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The Shell studies imply that fuel cell sales will start with stationary applications to businesses that are willing to pay a premium to ensure highly reliable power without utility voltage fluctuations or outages. This demand helps to push fuel cell system costs below 500 per kW, providing the era of transportation which drives costs to 50 per kilowatt. But, can the high-reliability power market really drive transportation fuel cell demand and cost reductions, especially for proton- exchange membrane (PEM) fuel cells ... 

Over years of R D, the system cost has been reduced significantly, as shown in Figure 8.4. The cost reduced from 275 to 108 and to 49 per kW from 2002 to 2006 and to 2011, about a 50% reduction every 4 years. The target of 30 per kW by 2017 does not appear to be overly optimistic. At this cost, a 100 kW fuel cell system costs only 3,000, similar to a normal internal combustion engine (ICE) system. 

Even in a simple hydrogen fuel cell system, capital cost reduction requires improvements in many diverse areas, such as catalyst loadings, air pressuriza-... 

There has been an accelerated interest in polymer electrolyte fuel cells within the last few years, which has led to improvements in both cost and performance. Development has reached the point where motive power applications appear achievable at an acceptable cost for commercial markets. Noticeable accomplishments in the technology, which have been published, have been made at Ballard Power Systems. PEFC operation at ambient pressure has been validated for over 25,000 hours with a six-cell stack without forced air flow, humidification, or active cooling (17). Complete fuel cell systems have been demonstrated for a number of transportation applications including public transit buses and passenger automobiles. Recent development has focused on cost reduction and high volume manufacture for the catalyst, membranes, and bipolar plates. 

Despite great improvements in fuel cell technologies over the past decade and demonstration of promising performance, both stationary and automotive fuel cell systems still face large challenges. These primarily involve cost reduction costs on the order of 500 to 800/kW-peak are required for competitive stationary systems, and costs on the order of 50 to 100/kW-peak are required for competitive FCVs. These cost levels are far below current levels for various fuel cell technologies that are in prototype and low-volume production. Additional challenges include fuel cell... 

In the future, if the cost of the fuel cell system approaches 50/kW, the cost of the electrolyzer is also expected to approach a low number (about 125/kW). Such low capital costs for electrolyzer units, together with levelized electricity costs in the neighborhood of 0.02 to 0.03/kWh, would result in a competitive hydrogen cost. It is also estimated that for a photoelectrochemical method to compete, its cost needs to approach 0.04 to 0.05/kWh. The order-of-magnitude reductions in cost for both hydrogen processes are similar. 

V/cell offers some cost reductions compared to the baseline, but both direct hydrogen fuel cell systems are significantly less expensive than either of the reformer/fuel cell systems. This cost reduction is primarily due to the decreased size and cost of the fuel cell stack, as can be seen in Figure 4. The... 

The price of the fuel cell stack is determined by the cost of the materials and the production technology. These costs are strongly determined by the number of units produced. For various components a strong decrease in the price can be expected as the demand increases. As a consequence, reliable cost estimations are difficult. However, the material expenses and some estimates of production costs can be compared with the actual market prices of the competing technologies, namely primary batteries, rechargeable batteries and the internal combustion engine. The comparison shows that fuel cell systems are still too expensive for most applications and a reduction of the cost by a factor of 10-50 is necessary to achieve competitiveness. 

The use of passenger car fuel cell system or the common uses of some sub-modules allow a significant cost reduction of the fuel cell powertrain for bus application. In several demonstration projects and in the small serial production busses, Daimler and Evobus have presented this application. 

In many regards, the use of fuel cells for electric power production is very attractive. Fuel cell systems are versatile, quiet, and virtually non-polluting. The single major factor limiting the widespread use of fuel cells in electric power production is their cost. However, if projected price reductions are realized, fuel cells will become cost competitive with other power generation technologies in a growing number of areas. 

The fuel cell developers will have to focus on cost reduction if they want their applications to become a mass-market product. In every market, the extent to which the cost of fuel cells will have to fall will depend on competing technologies. It is sometimes argued that the price of fuel cell systems could increase because of the limited availability of precious metals like platinum [58, 69]. 

The costs for fuel cell systems are currently extremely high due to individual manufacturing, but a significant reduction is feasible today by mass production. A study by NREL and TIAX [13] calculated the costs for the components of fuel cell systems and the overall cost for mass production. 

Components that are critical for success include the hydrogen tank (pressure vessels) and the electric machines, which can be responsible for two-thirds of fuel cell drivetrain costs. Production and assembly processes can lead to learning effects and possible cost reductions. Fuel cell systems need to be optimized for their automotive application, for example, in terms of durability, packaging and start-up behavior. 

Credible cost reduction pathways are necessary for stationary fuel cell systems to achieve the longer term aim of mass market adoption. Developers therefore face the challenge of both addressing market segmentation, but also of defining... 

Fuel cells and fuel cell systems have reached a level of maturity that allows for their broad apphcation in stationary and antomotive apphcations there is still a number of requirements in terms of cost reduction and increase of energy output that will be in the focus of futirre research activities. 

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