Economics of on-site power generation by fuel cells

Abstract Recent advances in fuel cell technology have led us to study characteristics of fuel cell processes, especially efficiency and minimum cost, and to interpret these characteristics in terms of possible competition between fuel cells and “conventionally” generated power. The study limited to processes utilizing fuel cells with solid-oxide and molten-carbonate electrolytes because present information indicates that these “high-temperature” cells alone are able to utilize efficiently the impure fuel stream that results from partial oxidation or stream reforming of methane (natural gas). The study is also limited to “on-site” generation since the main advantage of fuel cells seems to be the hope of reducing the consumers' cost of electricity due to the lower cost of transmitting and distributing energy as methane rather than as electricity. THe results are reached via a detailed theoretical analysis that involves economic optimization of single cells, evaluation of performance and economics of batteries, evaluation of performance and economics of complete processes, and comparisons with costs of conventional electricity. In making the analysis, we have endeavoured to be as realistic as possible in the processes area, including not only the effects of reforming, but also such factors as incomplete fuel-utilization, battery effects, heat rejection, etc. In other areas, notably cell life and cost, we have been optimistic to the extent of assuming improvement over the present state-of-the-art through continued development. One conclusion of the study is that the solid-oxide cell processes will not be economical unless a way is found to eliminate noble metals in electrodes and in cell-to-cell connectors. The lowest conceivable materials cost for a single cell is too high for practicality while still retaining noble metals in electrodes and connectors when consideration is given to the various escalating factors involved in projecting materials costs to system costs. On the other hand, the study concludes that the molten-carbonate cell processes migh be competitive in industrial and commercial applications, provided certain extensions in technology are realized. Notable among these is cell life, which must be improved to about 4 1 2 years.