Technology learning for fuel cells: An assessment of past and potential cost reductions

Fuel cells have gained considerable interest as a means to efficiently convert the energy stored in gases like hydrogen and methane into electricity. Further developing fuel cells in order to reach cost, safety and reliability levels at which their widespread use becomes feasible is an essential prerequisite for the potential establishment of a ‘hydrogen economy’. A major factor currently obviating the extensive use of fuel cells is their relatively high costs. At present we estimate these at about 1100 €(2005)/kW for an 80 kW fuel cell system but notice that specific costs vary markedly with fuel cell system power capacity. We analyze past fuel cell cost reductions for both individual manufacturers and the global market. We determine learning curves, with fairly high uncertainty ranges, for three different types of fuel cell technology – AFC, PAFC and PEMFC – each manufactured by a different producer. For PEMFC technology we also calculate a global learning curve, characterised by a learning rate of 21% with an error margin of 4%. Given their respective uncertainties, this global learning rate value is in agreement with those we find for different manufacturers. In contrast to some other new energy technologies, R&D still plays a major role in today’s fuel cell improvement process and hence probably explains a substantial part of our observed cost reductions. The remaining share of these cost reductions derives from learning-by-doing proper. Since learning-by-doing usually involves a learning rate of typically 20%, the residual value for pure learning we find for fuel cells is relatively low. In an ideal scenario for fuel cell technology we estimate a bottom-line for specific (80 kW system) manufacturing costs of 95 €(2005)/kW. Although learning curves observed in the past constitute no guarantee for sustained cost reductions in the future, when we assume global total learning at the pace calculated here as the only cost reduction mechanism, this ultimate cost figure is reached after a large-scale deployment about 10 times doubled with respect to the cumulative installed fuel cell capacity to date.