Thursday, November 8, 2012

More post-Sandy commentary

This column by Bob Massie of the New Economics Institute describes a series of discussions he had back in 2000 - that's 12 years ago - about the possibility of developing cars powered by hydrogen fuel cells. The idea wasn't that far-fetched; GM unveiled the Hy-Wire concept car in 2002.

Of course, Massie recounts, there were problems with the idea, one of them being how to convert gas stations to supply the fuel. He asked someone from a petroleum company about the problem of fuel cell infrastructure. Here's what he says:
How many gas stations were there in the United States? I asked. About 150,000, he said. How much would it cost to convert a gas station to provide hydrogen? I continued. Anywhere from $500,000 to $1,000,000, he replied. And did every gas station have to be converted to provide adequate supply? No, he said, they anticipated that only about a third of existing stations would need to switch to provide adequate coverage.
I did the math. "So you are saying that the price of converting every gas station in the country at the maximum price would be about $150 billion?" I asked. Yes, he said. "And if the price were only $500,000 and we only did 1/3 of them, we could do the job for $25 billion?" Yes, he agreed. We came to the conclusion that a reasonable cost for the whole job would be about $50 billion.
That looks like a lot of money, but at less than 1/3 of 1% of a single year's GDP, it seemed a bargain price to change America's automotive fuel source so profoundly. The investment had the potential to completely revitalize America's auto industry, alter our fuel sources, and, because hydrogen fuel cell reforming emits less than half the carbon emissions of internal combustion engines, catapult us into a clean energy future. When the discussion came up in the press, however, political and business analysts ridiculed the idea that Congress would ever commit $50 billion to such a switch.
That $50 billion? It's about the cost of the cleanup from Hurricane Sandy, in today's dollars. The cost to convert would have been more than $50 billion, of course, but Massie has a pretty good point, I think. Do you agree?

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