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Iceland strides toward a hydrogen economy

Global economic crises underscores urgency of the goal, even as it delays progress.

By Colin WoodardStaff writer / February 12, 2009

Power plants like this one at Hellisheidi, Iceland, produce much of the volcanic island’s green energy. Earth’s heat turns water to steam, which spins turbines.

Colin Woodard


ReykjavÍk, Iceland

It looks much like any other filling station: Shell-branded gasoline pumps lined up before a brightly lit convenience store on the shoulder of a busy highway. But this is the hub of one of Iceland’s most ambitious projects, an obligatory stop for visiting foreign dignitaries that offers a glimpse of what might be the future of human transportation.

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This is no ordinary Shell station. Just to one side, where you might expect to find diesel pumps, stands the world’s first commercial hydrogen fueling station. Pull up in your hydrogen-powered car, swipe your credit card, attach the pump fixture, and in five minutes you’ll be back on the road, your tank full of emissions-free fuel produced right at the filling station from water and sustainably generated electricity.

“It’s a completely green car, with only water coming out of the tailpipe,” says Jon Bjorn Skulason, general manager of Icelandic New Energy, who drives one of the city’s 14 hydrogen-fueled vehicles. “If we complete our plans, we will be a zero-emissions society. We would not have to import fuel from foreign sources, and we would be 100 percent sustainable, which must be the true future of the world.”

While many countries talk about sustainable energy and redu­cing greenhouse-gas emissions, Iceland is committed to weaning itself off fossil fuels altogether by the middle of the century. Instead of importing oil to power its cars and fishing vessels, this remote island nation of 300,000 plans to power them like everything else here: with electricity from hydroelectric and geothermal plants.

In recent decades, Icelanders have harnessed meltwater from massive ice sheets and the steam that pours from its volcano-dotted landscape, which together generate virtually all the island’s heat and electricity. In the dead of winter, Icelanders use geothermal heat to grow bananas in frost-covered greenhouses, and to warm the streets and sidewalks of central Reykjavík.

“Our power plants are essentially processing water,” says Eirikur Hjalmarsson, spokesman for Reykjavík Energy. Its geothermal power plants have become tourist attractions. “Since we’re generating electricity from renewable sources, it may make sense to use it to power vehicles.”

The government’s plan, announced in 1998, is to replace fossil fuels with hydrogen. Together with Daimler AG, Shell, Norsk Hydro, and local utilities and research institutions, they created Icelandic New Energy, the company charged with spearheading the effort. The Shell station opened in 2003, serving the needs of three experimental hydrogen fuel-cell buses that plied the streets of Reykjavík for four years without incident. Hydrogen-fueled cars followed in late 2007, and were joined by a fuel cell-equipped passenger vessel last year.

“We haven’t found any major problems with the operation of a hydrogen economy with buses, cars, or ships,” says Icelandic New Energy’s Mr. Skulason. “If somebody were to say to me today, ‘I’ll bring 20,000 hydrogen cars to Iceland every year for the next five years at the same cost as a conventional car,’ it would not be a problem for us.”

But the project, which aimed to convert the country to hydrogen by 2040, is several years behind schedule, due to delays in automobile manufacturers’ roll-out of the next generation of hydrogen vehicles, which the global recession will only make worse. Iceland’s own financial collapse has not only delayed the building of additional fueling stations, Skulason says, but has also underscored the need to develop domestic fuel supplies.