Dang! More Fuel Cell information!

[salty]

You are paying anyway, so maybe you better start figuring out how this REALLY works.

[DD_BobK]

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Great post. Simple logic to de-bunk the "fuff piece".

More like 20 houses....maybe.

OP-

Unless fuel cell tech has made some great strides in the last 4 years (last time I discussed fuel cells with the guys I know at NFCRC) fuel cell capital costs are ~10x small (25 to 200 kw) microturbine generators and they;re not exactly cheap.

cheers Bob

[George]

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Folks who actually design and manufacture fuel cells will tell you that they are not yet economically ready for prime time. There are pretty much two reasons why you would use them. One is you are building a spacecraft and there is some reason you can't use a nuclear power source. Two is you can get the government to pull the money out of the pockets of others to subsidize your installation.

[trader4]

$68,000 for a brand new 3 phase 400KW generator. How does that sound compared to the $1mil for the fuel cell and $6.5mil for the total fuel cell project cost that powers two elementary schools. Think you could get that $68K generator into a suitable structure, connected, running, etc. for less that $6.5mil? Still happy to see your tax money used like that? How many jobs do you think it saved or created?

As for costs, we're still waiting to see true costs from you on the fuel cell. AFAIK, for a typical fuel cell like this, you wind up saving 20 to 40% on energy costs. But I'd like to see where you ever come even close to recovering the $6.5mil that was spent upfront.

I have a Honda car to sell you for $200K. I'll throw in free oil changes for life as a free bonus. Sound good?

[Fillet]

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You mean the way they have been subsidizing fossil fuels for the past

75 years or more?

If subsidies are your only argument, then you don't have one.

[trader4]

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Having one subsidy doesn't make the next one right. I use conventional fossil fuels and nuclear for most of my power. Outline where there is any subsidy approaching handing out $6.5 mil for a fuel cell for too schools for me.

[Fillet]

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Holy Crap! Are you even slightly serious with that question?

Oil companies get billions upon billions of dollars in subsidies, and always have. How do you think they put the whaling industry out of business?

[Kurt Ullman]

Name a couple. The depletion allowances don't count because that is something that ALL mineral extractors get.

[Fillet]

How about 500 Billion in Fossil Fuel subsidies world-wide PER YEAR?

[Fillet]

How about 500 Billion in Fossil Fuel subsidies world-wide PER YEAR?

[Fillet]

You don't get to pick and choose, which subsidies "count" and which ones don't.

A subsidy is a subsidy is a subsidy.

[Kurt Ullman]

The "tax breaks" are long standing ones that are given to all miners, etc., because of the finite nature of finds. It is essentially amortizing the production input pretty much like a punch press, or computer or other things. One talked about lower than average sales taxes. Since most sales taxes are put on by the individual states, I am not sure how that is a subsidy to the oil industry. I also note that the links did not also include royalties, leases, etc., that the oil companies to the government for the rights to drill.

[Kurt Ullman]

Corp income taxes are the same for oil industry. They have a tax break for depletion that is given to every mineral extracting company as a way to take into account that taking out a mineral is like using up a punch press, computer or any other input of production.

Sales taxes are a state tax. In Indiana anyway, the sales tax is there on gas. Some states have a deal where they charge sales taxes only on the cost of the gas after backing out the other state and federal taxes so you don't pay taxes on the taxes. Otherwise I have no idea what the Concerned Scientists are talking about.

Most of which come from the Fed and state taxes on gas. Also help the auto industry, tourism industry, trucking industry, construction industry, politicians by giving them more money to spread around.

Hidden or made up?

[Fillet]

It is a subsidy, no matter how much you try and rationalize.

[Kurt Ullman]

Fine, as long as you note that this is not an OIL company subsidy, but a tax break given to all companies that extract minerals (oil, gas, copper, coal, iron ore, aluminium, etc. etc.) Indeed is a part of the tax code that EVERY entity from BP through to the sole proprietor of the local bodega gets to take advantage of.

[trader4]

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And you don't see a difference between cases where a subsidy is a tiny factor in the cost of the end product and doesn't change whether the final product is economically viable and a subsidy that is so overwhelming that without it the product could not come close to being vialbe on it's own?

In the case of fossil fuel subsidies, ie oil, NG, coal, these businesses are all viable without the subsidies. The companies involved pay HUGE taxes at the highest rate. So, what if the tax is reduced a small amount? The change in the cost of the end product without the subsidy might be a few percent, if that. All the major oil companies are paying 50% of their income in FED tax, after any special tax credits.

Then we have the case of the fuel cell under discussion here. The govt paid the entire amount of the project, $6.5Mil for a power facility to provide power to two elementary schools in CT. It didn't take a 10% subsidy to make it economically viable. They had to pay for the whole thing.

In my view those are two very different situations. The first has past the test of being economically viable and a good allocation of resources via the free market. The second, has not. The first, at worst, leads to a minor change in how capital and resources are allocated by the free market. The second creates a total distortion of those.

Also, the claim of $500mil in "subsidies" worldwide for fossil fuels is extreme. Those numbers are coming from proponents of alternate fuels and they have included everything but the kitchen sink in them. Things like including money spent on public roads because it encourages the use of oil, or conjuring up some alleged public cost of healthcare attributable to illnesses caused by burning fossil fuels.

[Fillet]

That is why they are making such obscene profits, while at the same time pleading that they can't make enough money.

Not on the planet with the yellow sun, they don't. What color is the sun on your planet?

Complete hogwash.

I suppose you have an explanation for why gasoline in many other countries costs more than twice as much at the pump?

[Kurt Ullman]

You want to actually kick in here with a fact to back up your comments?

See above.

The entire difference is related to higher taxes. IN other words, artificial.

[Kurt Ullman]

They are making "huge profits" because they are big companies. The average profit margin for oil companies run around 8%, the average industrial profit margin is around 6.5%. (If you back out the auto industry, they have a profit margin that is actually less than average). I might take your umbrage about oil company profits a little more seriously if you were even more upset about biotech and computer software where the profit margin runs to just under 20%. If you make 8%, you are going to make more profits at $100 than at $10. Profit numbers are so high because the amount sold is so high.

[Fillet]

I'm not the one who made the unsupported claim. Provide what yu think is proof that "The companies involved pay HUGE taxes at the highest rate." and I will be happy to debunk your "proof".

Yes, complete hogwash.

Since you like to ask for cites, I'll ask you to provide some verifiable ones for this malarkey.