Something in the Air
In an industrial park still under construction in Poway in northern San Diego County, Ballard Power Systems has a good shot at developing, within the next few years, a commercially economic fuel cell that will be able to run buses and cars with no noxious emissions.
The goals of the San Diego unit of Ballard, a small, $25-million-in-sales company based in Vancouver, Canada, recently became more attainable when Germany’s Daimler-Benz--maker of Mercedes cars--invested $450 million in the company, including $250 million to finance accelerated fuel cell work in San Diego, Vancouver and Stuttgart, near Daimler’s headquarters.
The company’s good fortune bodes well for California--particularly the Southland--where clean-air equipment and services is now a $2.2-billion-a-year business, employing more than 15,000 people in a score of small companies, according to San Diego’s authoritative Environmental Business Journal.
The air pollution segment is still a lesser part of California’s $22-billion-in-sales environmental industry overall, which includes water treatment and waste disposal companies. But air pollution is about to become a larger industry. And early in the next century, air pollution equipment and services has enormous potential as firms such as Ballard perfect their technologies.
“Every country and major company look to California for innovation in emissions reduction,” says Dan Sperling, head of the Institute for Transportation Studies at UC Davis. Environmental innovations “will happen first in California and then will happen everywhere,” he says, referring to vast potential markets in smog-shrouded cities from Mexico City to Bangkok and Lagos to Sao Paulo.
California’s know-how is about to take a couple of leaps forward thanks to two regulatory developments. First, the California Air Resources Board ruled last month that vehicle emissions tests will become more stringent as of 2001. Emissions tests will be taken at the equivalent of 80 mph, with the air-conditioning running, to better simulate actual driving conditions than do current tests, which are conducted at 57 mph.
The assumption is that such tests will reduce harmful emissions by 133 million tons a day by requiring cars to be equipped with stronger controls.
Also, the federal Environmental Protection Agency has come out with proposed rules on particle pollution, which will seriously restrict the use of diesel oil in trucks, buses, and ships in Los Angeles and Long Beach harbors.
Such EPA rules are controversial, and groups from trucking and other industries are lobbying Congress to prevent their implementation. But, if administered intelligently, rules on air pollution benefit the economy in several ways.
Most obviously, they drive reductions in pollution. During the last 20 years, Southern California has cut the number of days children can’t take recess out of doors from 184 in 1977 to 53 last year.
And like them or not, rules spur work on nonpolluting vehicles and engines from the region’s many innovative companies, from Aerovironment in Monrovia to Motive in Newport Beach, from AC Propulsion in San Dimas to AlliedSignal in Torrance.
“We won’t be using gasoline engines 20 years from now,” says Ron Flint of Motive, a car design firm that works with major auto makers.
In fact, a serious phaseout of gasoline engines will start before 2010 if Ballard makes the progress on fuel cells that it believes possible.
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“We’re past the science stage on the fuel cell,” explains Neil Otto, vice president for Ballard’s U.S. operations and head of the Poway facility. “Now we’re working on getting the costs down so that fuel cells can be less expensive than internal combustion engines.”
That’s still a tall order. A Ballard fuel cell that would provide the power of a $2,500 to $3,000 internal combustion engine now costs about $14,000.
But Otto, a Chicago-born metallurgical chemist, points out that every facet of today’s fuel cell is separately machined, as fuel cells are when they power NASA’s space vehicles. But those costs will come down as Otto and the 25 research workers at Poway develop ways to mass-produce the devices. “We’re within the envelope on cost,” says Firoz Rasul, Ballard’s Vancouver-based chief executive.
Fuel cells are deceptively simple--a series of membranes sandwiched between graphite plates through which hydrogen passes to combine with oxygen, releasing energy and water vapor as byproducts.
But the challenge of Ballard’s work, which is being watched by all the major car makers now that Daimler-Benz put such an investment into it, is anything but simple. The Poway plant is working on a fuel cell that will use methanol as a source for hydrogen to power a Mercedes without noxious emissions. The car will be introduced to California highways in 2003, the state’s deadline for zero-emission vehicles.
After that, progress on fuel cells could usher in a new era of nonpolluting transportation--and energy supplies that would be a revolution for Southern California in more ways than one.
First, nonpolluting transportation would allow the continuation of economic growth in this mobile region that suffers particular problems of air pollution.
“Some say the choice is mobility or clean air, but that’s not a real choice,” Otto says. “We must have both.”
And then we can bring them to the rest of the world. For the development of fuel cells and other nonpolluting innovations would greatly increase the size and global importance of the region’s environmental industry.
Southern California’s economy will reap great riches in jobs and capital in the next century if it can build on its present position as environmental leader of the world.
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Smog Fighters
California’s remarkable progress in reducing smog has spawned a billion-dollar industry in air pollution equipment that has enormous potential for the state. Vancouver, Canada-based Ballard Power Systems, which makes fuel cells in its San Diego plant, is one of almost 200 companies competing in the sector. Here’s a look at air pollution advisories and how the state’s pollution-control and overall environmental industries compare.
Declining Pollution
(Please see newspaper for complete graph information)
Numbers of days each year when health advisories are issued in the L.A. Basin:
1996: 53 days
Sizable Industries
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Air-pollution- Total state control environmental equipment industry* Revenues $1.43 $22.18 (in billions) Exports $0.45 $2.16 (in billions) Employment 10.2 157.5 (in thousands) No. of companies 174 12,464
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* Includes sold-waste, waste-water and hazardous-waste services, equipment and resources.
Sources: Environmental Business International Inc., South Coast Air Quality Management District
