BOARD MEETING DATE: January 21, 2000
AGENDA NO. 12

PROPOSAL:

Authorize AQMD Membership in California Fuel Cell Partnership as a Full Partner

SYNOPSIS:

The California Fuel Cell Partnership has invited the AQMD to join it as a full member. The Partnership seeks to demonstrate fuel cell vehicles through on-road operation and development of supporting fueling sites beginning in 2000.

 

COMMITTEE:

Technology, December 17, 1999, fewer than three members were present and therefore, pursuant to the Procedures for Standing Committees of the Governing Board, the Committee forwards this letter without recommendation.

RECOMMENDED ACTION:

1. Authorize the AQMD to join the California Fuel Cell Partnership as a full member; and,
   
    
2. Authorize the Chairman to endorse the California Fuel Cell Partnership Statement of Intent and its Addendum subject to the AQMD Public Records Act Guidelines.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

In April of 1999, the California Fuel Cell Partnership was formally initiated. It’s membership currently includes auto manufacturers (DaimlerChrysler, Ford Motor Company, Honda and Volkswagen), energy providers (ARCO, Shell and Texaco), a fuel cell company (Ballard Power Systems), and the State of California (California Air Resources Board and the California Energy Commission). Through this public/private effort, automobile companies and fuel suppliers have joined together to demonstrate fuel cell vehicles under real day-to-day driving conditions. The Partnership will place approximately 50 fuel cell passenger cars and fuel cell buses on the road between 2000 and 2003. In addition to testing the fuel cell vehicles, the Partnership will also identify fuel infrastructure issues and help prepare the California market for this new technology.

On October 21, 1999 the Partnership formally invited the AQMD to join as a full member, including representation on its Steering Committee. The Partnership staff presented this request at the October 22 Technology Committee meeting. A number of questions were raised by the Committee members at that meeting. Subsequently, the Partnership addressed those questions and concerns in a letter (see attachment). In summary, the Partnership has provided the following clarifications to its request:

Expectations of the Partnership Regarding the AQMD’s Participation:
The Partnership would like the AQMD to fully participate in both the Steering Team and Working Group meetings, and provide support commensurate with the other partners (see Proposal).

Status as a Full Partner:
The AQMD is being invited to participate as a full partner and not as an Associate member.

Reason in Delay in Inviting the AQMD to Join:
The idea for establishing the voluntary partnership began to crystallize in late 1998 through informal discussions among ARB staff and the Fuel Cell Alliance consisting of DaimlerChrysler, Ford and Ballard. There was a sense of urgency to formalize and announce the partnership as soon as possible. Fuel providers were recognized as a critical early addition to the core group prior to any announcement. There was an understanding that additional full partners, including other government entities such as the AQMD, would be invited at a later date.

Intention to Broaden the Partnership’s Outreach:
The Partnership plans to invite other key industry members to become associate partners as their expertise is needed to implement the programs envisioned by the Partnership.

As a full partner, the AQMD is being asked to support the goals and objectives of the Partnership, which may include support of partnership expenses and fuel cell vehicle demonstrations. The AQMD is also being invited to provide representation on supporting teams, and participate in guiding the project to completion in 2003. Specifically, the Partnership seeks to achieve four main goals:

1. Demonstrate vehicle technology by operating and testing the vehicles under real-world conditions in California;
2. Demonstrate the viability of alternative fuel infrastructure technology, including hydrogen and methanol stations;
3. Explore the path to commercialization, from identifying potential problems to developing solutions; and
4. Increase public awareness and enhance opinion about fuel cell electric vehicles, preparing the market for commercialization.

Proposal

The Partnership has incorporated its goals and operating guidelines into a Statement of Intent (SOI), which the AQMD has been asked to endorse. The SOI commits the Partnership to a consensus decision process regarding the direction of specific projects and activities, and does not create any legal rights or obligations between the participants in the Partnership. Vehicles and equipment utilized in the program remain the exclusive property of the manufacturer if so desired by the manufacturer. Participants also agree that there will be no attempt to reverse-engineer vehicles or equipment used as part of any project

Phase I of the Partnership’s program runs through FY 1999, and will focus on development of vehicle, infrastructure and outreach plans for future projects. Phase II, FY 2000-2001, involves the demonstration of fuel cell cars and buses using hydrogen fuel. Phase III, FY 2002-2003 involves the demonstration of cars and buses using methanol or hydrogen fuel. Expansion of this latter phase may include a limited number of fleet customers beginning in 2003.

The Partnership expects all full partners to share equally in the common partnership expenses. Specific request for AQMD funding will be evaluated by staff, and if warranted, will be brought to the Board for approval.

Benefits to AQMD

The efforts of the Partnership are expected to have a significant effect on the pace and scope of fuel cell vehicle commercialization. The Partnership has identified four major objectives need to be achieved to commercialize fuel cell engines for automobiles. The first is to refine the development and size of the engine so that it can operate on a liquid fuel and not take away from the passenger and cargo space of the vehicle. The second is to reduce the cost of the fuel cell engine so that it is competitive with today's ICE. The third is to develop the manufacturing processes that will be required to produce fuel cells and fuel cell engines in automotive volumes. And fourth, depending on the choice of fuel, infrastructure investments will have to be made to support widescale introduction.

The Partnership will expedite the commercialization of fuel cell vehicles by helping to address these objectives. The AQMD’s Air Quality Management Plan (AQMP) considers fuel cell vehicles to be a core technology which is needed to continue our progress in attaining and maintaining clean air standards.

Membership in the Partnership is consistent with the November 1998 update of the Technology Advancement Plan under Project 98M13-3, Demonstration of Fuel Cells in On- and Off-Road Vehicle Applications. The AQMD supports the ARB’s zero-emission-vehicle requirement and strives to educate public and private organizations regarding the benefits and characteristics of fuel cell vehicles.

Authorization for funding of vehicle demonstration activities, such as the planned fuel cell bus demonstration project, and other activities of the Partnership, may be sought from the Board in the future.

Attachments

A - Letter of Intent dated October 12, 1999
B - Letter of Clarification dated November 18, 1999

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