Background

The Air Quality Management Plan identifies the need to achieve major use of zero-emission vehicles (ZEVs) in the Basin for both on- and off-road applications. The Air Resources Board (ARB) has adopted several regulations to help meet these AQMP objectives, including the 1990 Low-Emission Vehicle / Clean Fuels rulemaking, which requires the seven largest automobile makers to collectively produce and certify about 28,000 on-road ZEVs in California by 1998. ARB has also adopted a requirement for all new golf carts in the Basin to be zero emitting by 1997. Effectively, these regulations require vehicle manufacturers to begin phasing out the internal combustion engine in favor of electric vehicles (EVs).

Near-term EVs obtain power and energy from conventional electrochemical batteries, which provide zero tailpipe emissions, but also have technological limitations resulting in relatively short driving ranges and long recharge times. Over the mid to long term, fuel cells are thought to be an ideal solution for EV propulsion because they can provide high fuel efficiency and zero emissions, while also matching the long range and rapid refueling capabilities of the internal combustion engine. When powered by renewable (e.g., solar- or wind-generated) hydrogen, fuel cells are truly "cradle-to-grave" zero-emissions propulsion systems.

In accordance with AQMP objectives, the AQMD's Technology Advancement (TA) program is working to expedite fuel cell vehicle commercialization in numerous ways. To date, the AQMD has cost shared several projects involving the proton exchange membrane fuel cell (PEMFC), a leading fuel cell technology for vehicular applications. These projects have focused on transit buses, passenger cars, and locomotives. The City of Palm Desert -- a model community for on-road use of electric golf carts and other environmentally benign modes of transportation -- has proposed TA cosponsorship of a pilot project to demonstrate small "neighborhood" EVs powered by PEMFCs fueled with renewable hydrogen.

Proposal

The primary objective of the proposed Palm Desert Renewable Hydrogen Transportation System project is to develop and demonstrate advanced PEMFC propulsion technolgy in small passenger and utility vehicle applications. Currently, such vehicles are dominated by either high-emitting internal combustion engines or range-limited battery-electric propulsion systems. A pilot fleet of PEMFC vehicles will be built that provides zero systems emissions -- benefits beyond those of battery-electric vehicles, which have associated power plant emissions.

Additionally, the project is designed to 1) encourage development of a renewable-hydrogen refueling infrastructure in the Coachella Valley by harnessing the area's abundant wind and solar energy resources; 2) educate city employees as well as the general public about the potential for hydrogen fuel cell technology to meet clean-transportation goals, 3) alleviate safety fears about hydrogen as a transportation fuel; and 4) provide economic development opportunities for the Coachella Valley by attracting a fuel cell manufacturing and service industry to the area.

The proposed project involves a public-private partnership that includes the City of Palm Desert, the Schatz Energy Research Center at Humboldt State University, the US Department of Energy (DOE), Sandia and Lawrence Livermore National Laboratories, and various private corporations. These participants, described in more detail below, plan to accomplish the project objectives through the following work program:

• Design, fabricate, and operate a fleet of five (5) personal utility vehicles and three (3) neighborhood EVs powered by hydrogen-fueled PEMFCs. Various modes of on-board hydrogen storage will be investigated, and the best-available system will be employed.

• Design, fabricate, and operate a refueling infrastructure relevant to future hydrogen-based transportation systems. This will include two zero-emission hydrogen generation/refueling stations. One station will feature wind-powered water electrolysis for hydrogen generation, and the second will use solar-powered water electrolysis.

• Conduct research into the details of PEMFC production, with particular emphasis on developing low-cost materials and manufacturing techniques.
• Design and construct a PEMFC service and diagnostic center. The center will be located in a refurbished building in the City of Palm Desert corporation yard. Service personnel will be trained through this project. The center will serve as an incubator to attract a fuel cell manufacturing industry to the City.

Project Participants

A strong and diverse partnership has been formed to fund this project and perform the work tasks. Project participants are listed below along with their proposed contributions:

• The City of Palm Desert, acting as prime contractor, will provide administrative oversight for the project, and a host site for the test vehicles. Palm Desert is an enthusiastic supporter of renewable energy and fuel cell technologies, as further described in the Sole-Source Justification section.

• The Schatz Energy Research Center (SERC) will be the primary subcontractor for this work, and will also provide major in-kind cost sharing in the form of project labor. SERC will have responsibility for design, fabrication, and testing of the fuel cell vehicles; design and oversight of the solar-hydrogen refueling station and the fuel cell service /diagnostic center (including training of personnel); and participation in research to lower manufacturing costs of PEMFCs.

• The DOE will provide technical oversight and approximately 43% of the project funding (subject to final approval of 1996 funding appropriations). DOE has provided a letter of support for the project.

• Lawrence Livermore National Laboratory, one of the project originators, will provide technical oversight for the wind-hydrogen refueling station, as well as expertise, consultation, and materials for the research on reducing manufacturing costs of PEMFCs.

• Sandia National Laboratory (SNL) will provide expertise on hydrogen storage, and select the best method of on-board storage for incorporation into the project vehicles. SNL will also provide expertise in the area of PEMFC manufacturing.

• DuPont will contribute all the proton exchange membrane material necessary to build the fuel cells, and provide expertise in membrane electrode assembly technology.

• Wintec, a local wind developer (in the San Gregornio Pass region), will contribute and install a 65 kW wind turbine for the wind-hydrogen refueling station.

• Teledyne-Brown Engineering will provide cost sharing and engineering expertise for the two 50 kW electrolyzers that will be used at the renewable hydrogen refueling stations.

• ASE Americas will provide cost sharing and expertise for the 50 kW photovoltaic array that will be used at the solar-hydrogen refueling station.

Sole Source Justification

Section II, Step C(3) of the Consultant Selection Policy and Procedure identifies four provisions under which a sole-source bid may be justified: (1) cost to prepare documents exceeds cost for consultant, (2) delay would result in the endangerment of public health, (3) services are only available from sole-source, (4) other circumstances exist identifying sole-source as in the best interests of the AQMD. This request for sole-source bid is made under provision # 3.

The consortium established for this project consists of a unique technical, administrative, and cost-sharing team. In December 1994 the (City of) Palm Desert Redevelopment Agency voted unanimously to support this project by: 1) committing matching funds of $300,000, 2) providing use of a 6,000 square foot building and adjacent corporation yard, and 3) contributing 17% annually of the City's Economic Development Director's time. The California legislature, through Assembly Bill 1229, established Palm Desert as a test locale where golf carts can be used as street-legal "personal utility vehicles." This legislation makes Palm Desert an ideal host site for the use of small PEMFC-powered vehicles, with a legitimate potential to become one of America's first cities to widely deploy such zero-emitting technology. Moreover, Palm Desert is beginning to acquire a national reputation as a model community for research, development and demonstration of alternative energy and transportation systems.

The proposed technical team is equally well qualified and highly capable of achieving the stated project objectives. Each member of the team brings unique expertise and/or cost sharing for a particular part of the project. DOE has provided a letter of support for the project indicating its intention to provide funding from the federal hydrogen program.

Financial Terms

The total cost of this three-year project, including direct and in-kind funding contributions, is estimated to be $4,228,440. Table 1 shows a breakdown of the anticipated cost sharing. The City of Palm Desert has asked the AQMD to contribute a total of $825,000 over 36 months -- equivalent to a cost share of about 20 percent. Staff recommends an AQMD cost share of $550,000 for the first year (FY 1995-96 funds). It is expected that staff will seek authorization to provide $275,000 in FY 1996-97.

                                                                             
                 Table 1: Anticipated Project Cost Sharing                   

Agency/Organization             Direct Funding         In-Kind Funding   

            US DOE                      $1,859,300                 -0-         

             AQMD               $825,000 (over 36 months,          -0-         
                                    $550,000 this FY)                          

             SERC                          -0-                  $521,640       

      City of Palm Desert                $300,000               $434,000       

            DuPont                       $42,500                   -0-         

            Wintec                         -0-                  $145,000       

  Teledyne-Brown Engineering             $40,000                   -0-         

         ASE Americas                      -0-                   $61,000       

           Subtotals                    $3,066,800             $1,161,640      

Grand Total                   $4,228,440                             

Sufficient funds are available in the FY 1995-1996 Budget of Technology Advancement to fund the first year of this project. This recommendation was approved by the Technology Committee July 12, 1995. In addition, this recommendation will be reviewed by the Technical Review Committee for allocation of SB2297 funds.

THEREFORE IT IS RECOMMENDED THAT YOUR BOARD

--Authorize the Chairman of the Board to execute the agreement with the City of Palm Desert to provide funding for the Renewable Hydrogen Transportation System project, in an amount not to exceed $550,000.

Respectfully,

James M. Lents, Ph.D.

Executive Officer

ACL:AA:JHL