March 19, 2018
Focus: Green Business/Energy

CT fuel cell industry sees hope, challenges ahead

Joel Rinebold Chairman of Connecticut Hydrogen-Fuel Cell Coalition and Director of Energy at Connecticut Center for Advanced Technology

Q&A talks with Joel Rinebold, chairman of the Connecticut Hydrogen-Fuel Cell Coalition and director of energy at CCAT, about the state and future prospects of Connecticut's fuel cell industry.

Q. There have been ups and downs in the fuel cell industry over the past few years. Starting with a positive development, Congress recently extended the 30 percent investment tax credit for fuel cells, which expired at the end of 2016. How significant is the tax credit for the fuel cell industry and might we see an uptick in production as a result?

A. The immediate effect of the investment tax credit will be lower costs, lower risk, and higher returns necessary for successful financing and project development.

The long-term effect includes the stabilization of the domestic fuel cell industry workforce; increase in manufacturing, siting, and installation jobs; and an increase of project revenues, tax payments to state and local governments, and business support for state supply chain companies.

The national Fuel Cell Hydrogen Energy Association projects an increase of 20,000 jobs over the next five years as a direct result of the investment tax credit. Many of these jobs will be in Connecticut.

Q. Moving to state government: While Connecticut has provided millions of dollars in economic support to fuel cell manufacturers, the Department of Energy and Environmental Protection (DEEP) has thus far declined to greenlight state-directed purchases of electricity from proposed fuel cell projects. An ongoing request for proposals (RFP) is supposed to help, but fuel cell makers have publicly expressed concern this year. What is the problem?

A. The clean energy RFP will help with fuel cell deployment that will provide clean and highly reliable power and state economic development with job creation. While the fuel cell industry is cautiously optimistic, it is concerned that new resources to be selected in this RFP may consist predominantly of intermittent generation to be operated outside of Connecticut.

There are expectations that the RFP process will recognize the additional value provided by fuel cells for clean and reliable power with high availability located within Connecticut, negating the need for new transmission, batteries, or backup capacity necessary with other energy resources.

Q. In addition to DEEP's role requiring utilities to buy power from certain clean energy sources, the agency also recently issued major recommendations for the state's energy future, the Comprehensive Energy Strategy. It recommends that fuel cells should not be permitted to generate the most valuable type of renewable energy credits, called Class I, because some types of fuel cells emit carbon dioxide. What impact would it have on the industry if fuel cells lost Class I status?

A. Connecticut now appropriately recognizes the value of fuel cells as advanced technology with extraordinary high availability. Fuel cells are also seen as complementary to the operation of intermittent renewable energy facilities, and with fuel and operational flexibility for long-term sustainability. If fuel cells are no longer qualified as Class I, Connecticut will miss a rare opportunity to retain and expand clean energy research and manufacturing jobs, and the ability to have dispatchable and highly reliable energy capacity to meet demand in conjunction with wind and solar energy.

Q. After choosing no fuel cell projects in a 2016 energy selection process, DEEP said solar and wind developers won out because they had cheaper bids and lower-cost energy projects. What is the fuel cell industry's take on how cost is, or should be, assessed in future selection processes?

A. A well-balanced decision will recognize the value and cost of all renewable technologies in a coordinated and equitable manner. All costs for back-up generation, battery storage, interconnection, extension of electric transmission and distribution lines, and the impact to natural and cultural resources must be considered.

All values including job creation, high availability, local reliability, and ease of siting with a high energy density that preserves land resources also must be considered. When all costs and values are assessed, fuel cells are a clear winner for powering up the state and region in a clean energy economy.

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