Community, Technology and Trust

On December 3, 2002 Coleman Powermate released the following press release.

“Coleman Powermate and Ballard Power Systems Generate Power Out of Thin Air

AURORA, Ill., Dec. 3 /PRNewswire/ -- Coleman Powermate, a leading power equipment manufacturer, today introduced the AirGen(TM) fuel cell generator -- a machine that converts two of the most abundant elements in the universe (hydrogen and oxygen) into electricity.

While it sounds like science fiction, fuel cells have played a pivotal role in space exploration, and they are now making their way into the marketplace.

‘The AirGen(TM) fuel cell generator marks the dawn of the Hydrogen Age,’ said Gwen Wisler, president and CEO of First Alert/Powermate, Inc. ‘This is the first step toward introducing fuel cells into homes and businesses.’

According to Ken Frank, senior research and development engineer, the AirGen(TM) fuel cell generator can be used as a portable power source or as an emergency backup power system.”

One can view this miraculous fuel cell by visiting the web sites of Coleman and Ballard. The pictures of the device show a hose running from the “fuel cell” to what appears to be conventional tanks for storing high pressure gases. The text notes that these tanks contain the hydrogen, one of the “two most abundant elements in the universe (hydrogen and oxygen)” referred to in the press release. 

What the press release does not say is that hydrogen does not exist as a separate element by itself, at least not on earth. Hydrogen is abundantly found in combination with carbon in the form of hydrocarbons, also known as oil, natural gas, and coal. 96-98% of all hydrogen is produce from hydrocarbons, primarily from natural gas.  2-4% of hydrogen is produced by electrolysis, a process where electricity is used to split water into hydrogen and oxygen. Currently the electricity used to split the water is generated from power plants which burn oil, natural gas, and coal - or uranium in the case of nuclear power plants. 

So the headline that reads “Generate Power Out of Thin Air” would be more accurate if it read “Generate Power Out of Hydrogen Produced From Fossil Fuels”.

A reader might be less enthused with the idea of a Hydrogen Age if the actual process was explained. There is nothing very exciting about using fossil fuels in a new way if our energy problem is based on the depletion of these fuels. The reader might think that the phrase in the release “sounds like science fiction” might be better restated, “sounds like B.S.”

Press agents and their writers do not welcome such factual statements. Being professionals, they would fall back to their second line of defense which is “It’s true hydrogen today comes from fossil fuels, but these are only “transition” fuels until the hydrogen can be produced by electricity from solar and wind power.” They would tell you that the cost of energy produced by solar and wind have dropped by a factor of 10 in the last twenty years.

This statement about transition fuels is true but not complete. In the first decade of this twenty year period, energy production costs did drop by a factor of 10. However, in the second decade of the twenty year period, production costs rose slightly. This is what engineers call “the law of diminishing returns”, meaning that as a technology is enhanced over the years, the early improvements are the most substantial ones and subsequent improvements are harder and harder to obtain.

We might ask the press agent the following question: “The AirGen is using hydrogen made from fossil fuels to generate electricity. You plan to eventually use solar power to generate the electricity that will in turn generate hydrogen (using the electrolysis process) to be used in the fuel cell to generate electricity. Why not just use the solar power to generate the electricity?” This is a somewhat complex sequence of statements to get to the question. It might have to be elaborated upon and, guessing how the press agent will react to this question, a lot of elaboration may be needed. Eventually the standard answer will be forthcoming: “Using solar power and wind is not cost effective yet.”

I applaud the work of Ballard and Coleman in researching, designing and developing the fuel cell they have announced. I know the more than 20 year history of the Ballard Corporation and it has not been an easy one.  They are both dedicated and committed to their work. But I wonder why they can’t tell us “the truth, the whole truth and nothing but the truth.” The Hydrogen Economy, like the Internet Economy, seems to be a fantasy used to extract money from investors and to seduce people into thinking our problems will be solved by the next technology. Like the Internet Economy, the Hydrogen Economy will find its place in the world. And, like the Internet, it may be far less glamorous, exciting and useful than it is currently made out to be.

Within a week of this announcement, Ballard stock dropped sharply based on negative recommendations by security analysts. Ballard had announced a 28% layoff as well as two financing packages from customer investments and an equity offering. The general response of the financial community was that Ballard’s moves represented responses to significant problems. Implementing cost effective fuel cells is a risky proposition and obviously Ballard is not finding this an easy task. “Generating power out of thin air” is apparently not a guarantee of success.

The sad thing about this is that once more people feel betrayed. Once more a corporation will have promised them something that the corporation knows is not true. Once more unnecessary disappointment and bitterness will be experienced. Once more people will ask “Who can we trust?”

Can we ever trust corporations when they exist in places thousands of miles from where we live? Can we trust them when they speak to us only through professional media specialists? Can we trust them when they are so big and powerful that the only people to whom they will listen are the stock analysts, venture capitalists and investment bankers? So far the answer is no.