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Executive Summary

The use of hydrogen as a fuel for cars and trucks has been touted as an environmentally responsible way to end America’s dependence on foreign oil. However, a transition to a “hydrogen economy” —if poorly executed—could extend America’s dependence on fossil fuels and nuclear power, while doing little to solve the severe environmental problems caused by our dependence on polluting and dangerous sources of energy.  As the nation and various states begin to engage the policy issues posed by hydrogen, it is critical that they do so carefully—proceeding with proven near-term strategies that reduce fossil fuel dependence while ensuring that any eventual transition to a hydrogen-based transportation system adequately protects America’s future economic and environmental health.

America’s inefficient use of fossil fuels threatens our economy, our environment and public health.

• Experts predict that, at current rates of growth in consumption, the worldwide production of oil will peak sometime within the next 35 years, and possibly by the end of the decade. When that peak occurs, supply will no longer be able to keep up with demand, triggering price increases and shortages.

• Domestic production of natural gas has failed to keep up with growing demand in recent years, despite a dramatic increase in the number of operating natural gas wells. Natural gas prices have doubled since 1995 and will likely remain high for the near future.

• Fossil fuel consumption in automobiles poses significant environmental and public health threats. Motor vehicles are responsible for more than a quarter of the nation’s emissions of smog forming pollutants and health-endangering particulates. America’s transportation system emits more global warming gases than the entire economy of any other nation in the world except China and possibly Russia.

• Coal and nuclear power are unacceptable long-term solutions to the nation’s energy problems. The extraction and combustion of coal cause devastating environmental and public health problems, while nuclear power remains an extremely risky and expensive source of energy.

Hydrogen fuel is neither inherently renewable nor inherently clean.

• Hydrogen does not exist by itself anywhere in nature. Instead, it must either be extracted from other fuels (such as natural gas or biomass) or extracted from water using electricity.

• The National Academy of Sciences estimates that creating hydrogen from renewable energy sources is likely to be more expensive than creating it from natural gas, coal or electricity in the near term. However, the NAS notes that:

• Using coal or electricity from today’s electric grid to create hydrogen is likely to release as much global warming-inducing carbon dioxide as burning gasoline in efficient hybridelectric vehicles (in the absence of as-yet-unproven technologies to capture and store carbon dioxide underground or in ocean waters).

• Dependence on natural gas as a source of hydrogen would likely lead to an increase in imports—replacing our nation’s dependence on imported oil with a dependence on imported natural gas.

• Generating hydrogen from renewable sources of energy would be virtually emission-free. But the cost of renewably generated hydrogen—at least in the short-term—is far greater than the cost of generating hydrogen from other sources. And using solar or wind power to replace the dirtiest forms of electricity generation in the short term would be less expensive and achieve greater reductions in carbon dioxide emissions than using them to generate hydrogen to power vehicles.

• Renewable generation of hydrogen—or the use of other renewable fuels for transportation—is essential for the long-term sustainability of the U.S. transportation system. Even if the average fuel use or global warming emissions from U.S. motor vehicles were to be sliced in half immediately, continuing the recent rate of growth in vehicle travel would result in a return to current emission levels by 2027.  Renewable energy is the only alternative that can achieve a breakthrough in the reduction of global warming emissions from transportation.

If hydrogen is produced from renewable sources of energy, it could alleviate our nation’s reliance on fossil fuels and nuclear power and reduce the environmental impacts of our transportation system.  To ensure that hydrogen can contribute to a clean, sustainable transportation future, we must employ “win-win” strategies that reduce our reliance on fossil fuels in the short term, while paving the way for renewable energy to power the nation’s transportation system in the future.

1. Make Today’s Cars Cleaner and More Efficient

• A variety of analysts have estimated that the nation’s cars and trucks could achieve 10 to 50 percent better fuel economy at minimal increase in costs using technologies that either exist now or will be on the market soon.

• Similar improvements are possible for reducing vehicle emissions. More than 20 models of partial zero-emission vehicles—each of which emits about 90 percent less pollution than today’s new cars—are now available in California and selected other states.

• State governments can encourage improvements in vehicle emission control technology by adopting California’s stringent-yet-achievable standards for health-threatening pollutant emissions and the introduction of advanced vehicle technologies.  Governments at all levels can use tax and other incentives to encourage the purchase of cleaner vehicles.

2. Develop Renewable Energy

• Increasing the amount of electricity generated from renewable sources would reduce the environmental impacts of our electric system, reduce our dependence on fossil fuels and nuclear power, and bring down the price of renewables in the future, making a transition to a truly renewable hydrogen future more easily attainable.

• Governments can promote renewable energy through the adoption of renewable energy standards for electricity generation and standards for the integration of renewable energy in building design, the creation of renewable energy funds, the adoption of tax credits for renewable generation, and the removal of barriers to the installation of clean, small-scale distributed generation technologies, including stationary fuel cells.

3. Pave the Way for a Renewably Powered Transportation System

• Government can play a role in encouraging basic research into vehicles and fuels with the potential to operate on renewable sources of energy, including hydrogen-powered and battery-electric vehicles and vehicles that operate on biomass fuels.

• Governments should not invest in the development of hydrogen fueling stations powered by non-renewable forms of energy. In addition, government should work to steer private-sector investment toward measures that move toward renewable generation of hydrogen. While the development of fueling stations based on natural gas might have short-term environmental benefits and ease the introduction of hydrogen powered vehicles, public money and effort would be best focused on solving the technical problems facing hydrogen-powered and other zero-emission vehicles and on supporting the development of renewable hydrogen technologies.

• State and local governments should also monitor the progress of safety codes and standards for hydrogen, adopting and enforcing them once they are promulgated. Governments should also open discussions with businesses, non-profit organizations and others to plan the future transition to a renewably powered transportation system.

Governments should not take actions that encourage the generation of hydrogen from environmentally damaging sources of energy.

• Government must not support efforts to derive hydrogen from environmentally damaging sources—such as the coal and nuclear-based hydrogen programs favored by the Bush administration—and should support the development of all vehicles and fuels with potential benefits for energy security and the environment, not just those that operate on hydrogen.

• Any hydrogen strategy that does not include progress toward cleaner cars in the near term, the expansion of renewable energy, and basic research into clean vehicle technologies—or that makes investments in technologies known to have major, negative environmental impacts—does not help to achieve the goal of a sustainable transportation system and should be avoided.