It’s been a long time coming, but Ballard Power is finally reading the tea leaves and realizing that the dream of a fuel-cell car powered by hydrogen is a dream that only a million-dollar prototype can occupy. The Vancouver-based fuel cell company, an industry pioneer and leader, confirmed today that it was in talks with part owners Daimler AG and Ford Motor Co. about, well, it didn’t say exactly. But we know it’s generally about “strategic alternatives,” and it’s likely about selling off the auto unit so that Ballard can focus on forklifts and power generation. I guess the market has been wishing for this for a long time, because the confirmation sent Ballard’s stock up 13 per cent today.
Now, how do we read this? Perhaps it’s not the death of the fuel-cell car, particularly if Daimler or Ford do take over the business. It kind of makes sense, at least at this point, that the auto companies embrace and drive forward the fuel-cell approach from hereon in. Failing that, the market is not going to happen. Ballard has done a good job lowering the cost of its fuel cells, though there’s still a long way to go. But there are other factors beyond its control — infrastructure, storage, standards, regulation, progess with competing technologies. The auto manufacturers are in a better position, given their scale, to influence these factors.
I can say one thing, however. As an avid reader — and generator — of news related to clean technologies, there is considerably more hype and excitement these days about the potential for electric vehicles powered by batteries/ultracaps than fuel-cell vehicles powered by hydrogen. The recent announcement from Shai Agassi re: the $200 million in private equity raised for his Project Better Place is a case in point. This is a big chunk of change aimed at supporting a major shift in the way we buy, sell and power vehicles, not unlike earlier ambitions for fuel-cell vehicles. The difference, however, is that momentum is on the side of battery technology and the infrastructure to support it needs to be extended and upgraded, instead of created from scratch. This isn’t to say Agassi’s vision of the future is a slam dunk — I’ve got some problems with his mobile phone analogy and the issue of lithium availability, which I’ll be addressing in a later post — but I do think the battery approach bypasses a couple of steps that makes hydrogen fuel-cell an inefficient choice for mass transportation. I also think millions of “smart” electric cars plugged into the grid can offer an extremely valuable way of managing electricity supply and demand and smoothing out peaks.
I’d be more than happy to host comments on the fuel-cell versus battery/EV debate on this post. I always love a good scrap.