While the fossil-fuel era enters its sunset years, a new energy regime is being born that has the potential to remake civilization along radically new lines--hydrogen. Hydrogen is the most basic and ubiquitous element in the universe. It never runs out and produces no harmful CO₂ emissions when burned; the only byproducts are heat and pure water. That is why it's been called "the forever fuel."

Hydrogen has the potential to end the world's reliance on oil. Switching to hydrogen and creating a decentralized power grid would also be the best assurance against terrorist attacks aimed at disrupting the national power grid and energy infrastructure. Moreover, hydrogen power will dramatically reduce carbon dioxide emissions and mitigate the effects of global warming. In the long run, the hydrogen-powered economy will fundamentally change the very nature of our market, political and social institutions, just as coal and steam power did at the beginning of the Industrial Revolution.

Hydrogen must be extracted from natural sources. Today, nearly half the hydrogen produced in the world is derived from natural gas via a steam-reforming process. The natural gas reacts with steam in a catalytic converter. The process strips away the hydrogen atoms, leaving carbon dioxide as the byproduct.

There is, however, another way to produce hydrogen without using fossil fuels in the process. Renewable sources of energy--wind, photovoltaic, hydro, geothermal and biomass--can be harnessed to produce electricity. The electricity, in turn, can be used, in a process called electrolysis, to split water into hydrogen and oxygen. The hydrogen can then be stored and used, when needed, in a fuel cell to generate electricity for power, heat and light.

Why generate electricity twice, first to produce electricity for the process of electrolysis and then to produce power, heat and light by way of a fuel cell? The reason is that electricity doesn't store. So, if the sun isn't shining or the wind isn't blowing or the water isn't flowing, electricity can't be generated and economic activity grinds to a halt. Hydrogen provides a way to store renewable sources of energy and insure an ongoing and continuous supply of power.

Hydrogen-powered fuel cells are just now being introduced into the market for home, office and industrial use. The major auto makers have spent more than $2 billion developing hydrogen-powered cars, buses and trucks, and the first mass-produced vehicles are expected to be on the road in just a few years.

In a hydrogen economy the centralized, top-down flow of energy, controlled by global oil companies and utilities, would become obsolete. Instead, millions of end users would connect their fuel cells into local, regional and national hydrogen energy webs (HEWs), using the same design principles and smart technologies that made the World Wide Web possible. Automobiles with hydrogen cells would be power stations on wheels, each with a generating capacity of 20 kilowatts. Since the average car is parked most of the time, it can be plugged in, during nonuse hours, to the home, office or the main interactive electricity network. Thus, car owners could sell electricity back to the grid. If just 25 percent of all US cars supplied energy to the grid, all the power plants in the country could be eliminated.

Once the HEW is set up, millions of local operators, generating electricity from fuel cells onsite, could produce more power more cheaply than can today's giant power plants. When the end users also become the producers of their energy, the only role remaining for existing electrical utilities is to become "virtual power plants" that manufacture and market fuel cells, bundle energy services and coordinate the flow of energy over the existing power grids.

To realize the promise of decentralized generation of energy, however, the energy grid will have to be redesigned. The problem with the existing power grid is that it was designed to insure a one-way flow of energy from a central source to all the end users. Before the HEW can be fully actualized, changes in the existing power grid will have to be made to facilitate both easy access to the web and a smooth flow of energy services over the web. Connecting thousands, and then millions, of fuel cells to main grids will require sophisticated dispatch and control mechanisms to route energy traffic during peak and nonpeak periods. A new technology developed by the Electric Power Research Institute called FACTS (flexible alternative current transmission system) gives transmission companies the capacity to "deliver measured quantities of power to specified areas of the grid."

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