Cleaner Energy, Greener Profits

The report argues that while fuel cells have high initial capital costs, they can be cost-effective by capturing 'distributed benefits' such as deferring utility distribution investments, providing premium reliability for the digital economy, and meeting strict urban emission standards. It proposes a commercialization path starting with grid-connected systems in commercial buildings and semiconductor fabs, eventually integrating with fuel-cell vehicles through vehicle-to-grid (V2G) systems.

• Fuel cells are characterized as high-capital-cost but low-energy-cost power sources. As of 2001, the cost per kilowatt (kW) of fuel cell capacity was approximately 7 to 10 times higher than that of combined-cycle combustion turbines used in central generating stations.
• Distributed generation (DG) provides 'option value' through small scale and modularity, which reduces the financial risk of overbuilding capacity and allows for shorter lead times compared to 'lumpy' central generation investments.
• Area- and time-specific (ATS) cost analysis reveals that marginal distribution capacity cost (MDCC) varies widely, ranging from $0/kW to over $1,000/kW. Targeting DG in high-MDCC 'hot spots' can allow utilities to defer costly transmission and distribution (T&D) capacity investments.
• Fuel cells offer significant advantages for the digital economy, where businesses such as data centers and semiconductor fabrication plants ('fabs') require 'premium-reliability power' to avoid crippling costs associated with even brief outages.
• Strict air quality regulations, particularly regarding oxides of nitrogen (NOx) in non-attainment urban areas, create a competitive advantage for fuel cells over reciprocating engines and small gas turbines, which may struggle to meet permitting standards.
• The report identifies a near-term commercialization path for fuel cells focusing on grid-connected systems in commercial buildings, communication provider facilities, and semiconductor fabs that require both high reliability and low emissions.
• A long-term vision involves integrating stationary fuel cells with fuel-cell vehicles via a 'vehicle-to-grid' (V2G) model, where parked vehicles generate electricity for the grid during peak-demand hours.
• Fuel cells can provide electrical engineering savings by reducing system losses, providing voltage and reactive power support, and extending the life of aging T&D equipment.

APA

Swisher, J. N. (2005). Cleaner Energy, Greener Profits. RMI. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_U02-02_CleanerGreener.pdf

Chicago

Swisher, Joel N. Cleaner Energy, Greener Profits. RMI, 2005. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_U02-02_CleanerGreener.pdf.

Wikipedia

{{cite report |last1=Swisher |first1=Joel N. |title=Cleaner Energy, Greener Profits |publisher=RMI |date=2005 |url=https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_U02-02_CleanerGreener.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{swisher2005cleaner, author = {Swisher, Joel N.}, title = {{Cleaner Energy, Greener Profits}}, institution = {RMI}, year = {2005}, url = {https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_U02-02_CleanerGreener.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }