The search for an alternative fuel

by Business Case Studies on Tuesday 10th June, 2008

The search for an alternative fuel

The rising price of oil is pushing the search for an alternative source of energy. Manufacturers have displayed dozens of fuel-cell concept cars but have been reluctant to put them into mass production without an infrastructure to support them.

Andrew McCree, chief executive of AEA, an energy consultancy that reports to the Department for Business, believes the rising price of oil will lead to the use of alternative sources of energy, particularly hydrogen. He said:”With oil at $200 a barrel, the economics of hydrogen energy look increasingly compelling.” (The Times, 24 May 2008)

Vehicles can be powered by hydrogen in two ways – by using a modified internal combustion engine or in fuel cells that generate electricity directly from the gas. The latter is more efficient and releases more energy by volume. Hydrogen can be manufactured as a green fuel by extraction from water using electrolysis driven by nuclear, solar or wind power. It could also be made from biomass or produced by genetically-modified algae. Because it can be obtained from water, there is a compelling energy security argument. Unlike oil and gas, it would not need to be imported from world trouble spots. (The Times, 24 May 2008)

Martin Green, development director at Johnson Matthey Fuel Cells said:”The real challenge is building the infrastructure to support an economy based on hydrogen.” (The Times, 24 May 2008)

Britain's first hydrogen fuel station opened at Birmingham University in April this year. This is the first stage of a technology revolution offering drivers the prospect of pollution-free motoring. The university is conducting trials with a fleet of five fuel-cell vehicles. Another three hydrogen stations are planned for London and there will be at least twelve stations countrywide by 2010, paving the way for the commercial production of cars powered by fuel cells. (The Times, 16 April 2008)

Air Products, the company that installed the fuel station, is also working with Transport for London to build fuel stations for a fleet of 70 hydrogen-powered vehicles to be introduced from next year. London's first hydrogen station will open next year at a bus garage in East London. (The Times, 16 April 2008)

See the Times 100 case study on Go-Ahead. The company was created as a result of bus privatisation and deregulation in 1986. Previously buses had operated in the public sector controlled by local authorities. Go-Ahead typically operates in densely populated areas, such as London, where its expertise lies in getting people to places on time in a clean, reliable and fuel-efficient way

Sources:

The Times, 24 May 2008(print edition)

The Times Online – Energy adviser puts forward powerful case for hydrogen, 24 May 2008

The Times Online – Hydrogen fuel stations for cars land in Britain, 16 April 2008

BBC News – Hydrogen car project begins, 17 April 2008 (video clip – Birmingham Fuel Station)

The Times 100 Edition 12 Case Studies – Go Ahead, Meeting needs in a competitive sector

Potential Questions

  • What are the stages of new product development?
  • What are some of the reasons why new products fail?
  • Read the source articles in full and discuss what benefits could be gained by a bus company using hydrogen fuel rather petrol/diesel.

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