GM looking at more deals to test fuel cells

VANCOUVER, British Columbia, June 9, 2003; Reuters reports that - General Motors Corp. expects to sign new agreements for testing stationary fuel cells similar to a pact unveiled recently with Dow Chemical Co., a company official said on Monday.

The automaker, which is testing the units in its broader effort to build fuel cells for cars, is in talks with other hydrogen producers, said Timothy Vail, a director of market development in GM's fuel cell development operation.

Vail did not name the potential partners but said he expected an announcement to be made "soon."

"It difficult for me to say (exactly when). It took a little bit longer than I thought to get the Dow agreement closed," Vail told reporters in Vancouver where he was speaking at a fuel cell industry conference.

GM and Dow Chemical announced in May that the automaker would supply and test a fuel cell system to help power a Dow plant in Freeport, Texas. The plant will supply fuel for the cells, which produce electricity via a chemical reaction rather than through combustion.

If the initial testing is successful, the cells could eventually produce up to 35 megawatts of electricity per year for the plant, enough for 25,000 homes.

Testing is expected to begin in the fourth quarter of 2003, and the companies will decide in 2005 whether to extend and expand the agreement.

Vail said GM still views its testing of stationary fuel cells as part of a broader effort to develop cells for cars that will be cost competitive with gasoline-powered engines.

Fuel cells are seen as an environmentally friendly alternative to standard gasoline engines because -- depending on the source of the hydrogen -- they generate electricity with little or no toxic emissions.

Vail and other speakers warned the conference on Monday that while fuel cells may be promoted as green power they will not win the hearts of consumers unless they can also be bought and used economically.

"The consumers is not going to take anything less than than they have today," he said.

Nearly all the major automakers are looking at developing fuel cell-powered vehicles, with GM looking at having them on the road by 2010.