A Strategy for the Hydrogen Transition

The document proposes a strategic commercialization path for fuel cells and hydrogen (H2) that avoids the need for immediate, massive bulk-supply infrastructure. The strategy relies on the development of "Hypercars"—ultralight, high-efficiency vehicles—and the integration of fuel-cell deployment between buildings and vehicles. By first establishing fuel cells in buildings for co- or trigeneration and using decentralized "hydrogen appliances" for production, the market can build the volume necessary to reduce fuel-cell costs to levels competitive for vehicles. Ultimately, the strategy envisions a transition from decentralized production to bulk supply, including wellhead reforming of natural gas with carbon sequestration and the conversion of hydroelectric dams into "Hydro-Gen" plants.

• The adoption of "Hypercars"—vehicles featuring ultralight design, polymer composites, and low aerodynamic drag—reduces the required fuel-cell capacity to approximately 25–30 kWe for a 4-passenger sedan or 30–50 kW for larger light-duty vehicles. This efficiency allows fuel cells to be competitive at a higher price point (around $100/kWe) and enables the use of compressed gaseous H2 tanks, eliminating the need for onboard liquid-fuel reformers.
• Fuel cells can be commercialized more rapidly by first targeting the building market, where they can provide co- or trigeneration (electricity, heating, and cooling). This approach leverages the fact that buildings use two-thirds of U.S. electricity and allows fuel cells to compete by utilizing thermal credits and providing "distributed benefits" to utilities, such as avoiding costly distribution grid expansions in "hot spots."
• A decentralized hydrogen infrastructure can be established using mass-produced "hydrogen appliances" (off-peak electrolyzers or natural-gas steam reformers) installed in buildings. These appliances can serve both the building's fuel cells and parked fuel-cell vehicles, which can act as "power plants on wheels" by sending 20+ kWe of electricity back to the grid during the day to offset lease costs.
• The transition to a bulk hydrogen supply can occur as the market grows, utilizing existing natural-gas networks or new pipelines. One high-profit opportunity is wellhead reforming of natural gas, where CO2 is reinjected into the gasfield for sequestration and enhanced hydrocarbon recovery, potentially providing a 200-year bridge to a fully renewable system.
• Renewable energy sources, specifically hydroelectric dams in regions like the Pacific Northwest and Tennessee Valley, could increase profits by becoming "Hydro-Gen" plants. These plants would produce hydrogen for vehicles rather than selling electricity into bulk markets, as hydrogen can be sold at a value equivalent to electricity prices 5–7 times higher than current bulk rates in those regions.
• The proposed strategy is estimated to be significantly cheaper than building a centralized hydrogen production and delivery system from scratch. A nationwide system of decentralized hydrogen sources is estimated to cost $4.1 billion, whereas some estimates for a from-scratch bulk infrastructure for 25 million cars reached $95 billion.

APA

Lovins, A. B., & Williams, B. D. (1999). A Strategy for the Hydrogen Transition. RMI. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_T99-07-A-Strategy-for-the-Hydrogen-Transition.pdf

Chicago

Lovins, Amory B., and Brett D. Williams. A Strategy for the Hydrogen Transition. RMI, 1999. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_T99-07-A-Strategy-for-the-Hydrogen-Transition.pdf.

Wikipedia

{{cite report |last1=Lovins |first1=Amory B. |last2=Williams |first2=Brett D. |title=A Strategy for the Hydrogen Transition |publisher=RMI |date=1999 |url=https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_T99-07-A-Strategy-for-the-Hydrogen-Transition.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{lovins1999strategy, author = {Lovins, Amory B. and Williams, Brett D.}, title = {{A Strategy for the Hydrogen Transition}}, institution = {RMI}, year = {1999}, url = {https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_T99-07-A-Strategy-for-the-Hydrogen-Transition.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }