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HYDROGEN ECONOMY    261


                         Considering that 70 percent of the U.S. population dwells in urban areas, the con-
                       struction of hydrogen pipelines and local hydrogen-generating facilities becomes a
                       daunting national task. It is estimated that the distribution of hydrogen fuel for vehi-
                       cles in the United States would require numerous hydrogen filling stations that would
                       cost several billion dollars.
                         The key to a successful hydrogen economy, as related to vehicular systems, is hydro-
                       gen fuel generation at the source. Such a scheme will allow combined solar, thermal,
                       and PV technologies to produce the required electrical and thermal energy for high-
                       temperature electrolysis that could provide liquid hydrogen at filling stations.

                       FOUNDATIONS OF THE HYDROGEN ECONOMY

                       A hydrogen economy is based on the premise of reducing dependency on petroleum fuel
                       and reducing atmospheric pollution resulting from the use of hydrocarbon fuels in trans-
                       portation. At present, a hydrocarbon economy is used for the production of petroleum-
                       based fuels such as gasoline, diesel fuel, and natural gas. However, the combustion of
                       hydrocarbon fuels causes the emission of greenhouse gases and other pollutants.
                         A significant characteristic of hydrogen fuel is that it has a high energy density by
                       weight. When used in fuel cells, hydrogen produces more energy than internal combus-
                       tion engines. Internal combustion engines, in general, operate at an efficiency of about
                       30 percent, whereas hydrogen fuel cell efficiency under ideal conditions is 35–45 percent.
                         The performance efficiency of hydrogen does not take into consideration losses in
                       production, which would result in an overall efficiency reduction of about 15–25 percent.
                       In fuel cell–based vehicles, when considering losses in the electric motor drives and
                       associated controls, the engine-to-wheel efficiency is reduced to 24 percent.
                         For the past several decades, hydrogen production has represented a significant global
                       segment of the petroleum fuel and fertilizer production industries. Worldwide production
                       of hydrogen exceeds 50 million metric tons, which equals about 170 million tons of
                       oil-equivalent fossil-fuel energy produced in 2006. Hydrogen energy production has
                       experienced a consistent growth rate of about 10 percent per year. In the United States,
                       annual hydrogen production is estimated to be about 12 million metric tons. The eco-
                       nomic value of all the hydrogen produced worldwide is over $140 billion per year.


                       PRIMARY USES OF HYDROGEN
                       At present, there are two primary uses for hydrogen, namely, as petroleum fuel and for
                       ammonia production. About half the hydrogen produced worldwide is used for ammo-
                       nia (NH ) via production or used directly or indirectly as fertilizer. In view of the
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                       world’s rapid population growth and intensive use of fertilizer, ammonia demand has
                       been growing at a rate of 12 percent per year. The balance of hydrogen produced is
                       used to convert heavy petroleum sources into lighter fuels, such as gasoline and jet
                       fuels. The process of hydrogen use in fuel refining is referred to as hydrocracking.
                         The scales of economies related to oil refining and fertilizer manufacture are clas-
                       sified into two categories, namely, captive for on-site production use and merchant
                       hydrogen for smaller quantities of hydrogen production, which are manufactured and
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