Hed: Fuel Cells in Your Future? The Market Should Say Yes!

Power to the People: How the Coming Energy Revolution Will Transform an Industry, Change Our Lives and Maybe Even Save the Planet, by Vijay V. Vaitheeswaran. Farrar, Straus and Giroux, 358 pages, $25.

President George W. Bush’s 2003 State of the Union address will always be remembered for his dubious assertions about Iraqi weapons of mass destruction. But buried within the speech, the Texas oil man turned President proposed a major federal initiative with potentially far greater implications for America’s long-term homeland security: $1.2 billion for research into fuel cells, the hydrogen-power plants long heralded by environmentalists as the Holy Grail of energy production. The prospects for fuel cells are tantalizing: Through a chemical reaction, these devices combine hydrogen and oxygen to generate electricity, with the only byproduct being harmless water vapor. If fuel cells can be made commercially viable, it would spell the death knell for the internal-combustion engine-and the oil industry as we know it.

Despite the President’s attempt at envirospeak and his empty buzzwords about fuel-cell automobiles (the “Freedom Car”), America continues to guzzle fossil fuels and to pay the price for its greed. More than 130,000 American troops are dodging bullets in Iraq to protect our strategic oil interests in the region. Two former oil executives control the White House. Average fuel economy for the American auto fleet is now at its lowest level since 1980. Detroit’s hulking S.U.V.’s grow more menacing with each new model year, a trend matched by the expansion of America’s waistlines. And this summer, the worst blackout in American history rippled across the Northeast as the ailing electricity grid faltered under relentless demand.

Some day soon, according to Vijay Vaitheeswaran’s analysis of the global $2 trillion energy market, all that will be just a memory of the bad old days. His plainly written and accessible Power to the People is a window on a technology-driven, environmentally clean future where oil and coal will be relics of a dirty past and fuel cells will reign supreme.

Mr. Vaitheeswaran, the energy and environment correspondent for The Economist, stays true to his magazine’s free-market doctrine and presents a modern energy future dictated by unfettered market forces-much to the detriment of President Bush’s Big Oil constituents-based on pure-burning hydrogen fuel and decentralized “micropower.” In Mr. Vaitheeswaran’s future, power will come not from gigantic, centralized power plants, but from nimble fuel-cell generators humming quietly away in homes, offices and under the hoods of our cars, powering everything from vehicles to cell phones, laptops, iPods and Gameboys. When these devices aren’t in use, we’ll be able to “sell” our excess capacity back into the “energy Internet.” Let 1,000 ConEds bloom! (I long for the day when my electricity bill is a check made out to me.)

“This book is about the future of our planet,” Mr. Vaitheeswaran declares. “By encouraging big nukes and big coal, America would be locking in old, dirty, inflexible, and inefficient technology for decades to come.”

Currently, America’s power-distribution system relies on massive power plants fueled by filthy coal, which Mr. Vaitheeswaran views as a perversion of economics and anomalous to democracy. We are invited to imagine a world in which “power flows not from on high, but from the masses.” In a truly free society, citizens would be empowered to produce electricity from localized clean sources rather than succumbing to the giant utility companies that are the literal and figurative arbiters of power in the global economy.

In his thoroughly researched survey, which reads like a collection of articles from the pages of Mr. Vaitheeswaran’s magazine, we’re treated to glimpses of “feel-good” environmental projects that seek to buck the primacy of fossil fuels. He takes us to San Ramón, “a hardscrabble” village in Honduras, where villagers installed shiny solar panels after Hurricane Mitch decimated their rural outpost in 1999. The indigenous groups now enjoy pollution-free energy and high-speed Internet access. (Could they now be posting profiles on Friendster?) Back in the U.S., Mr. Vaitheeswaran ogles the Condé Nast Building in Times Square, but not for the lithe editorial assistants or the sensuous lines of Frank Gehry’s cafeteria. He’s enthralled by the boxy fuel-cell generators “whirring quietly away on an unfinished floor.” The building, designed by architect Robert Fox, generates a majority of its power from on-site sources, a working example of Mr. Vaitheeswaran’s “micropower” vision. These examples are presented in vivid detail-without arcane science or thickets of technobabble.

Born in India, raised in Connecticut and educated at M.I.T. (where he earned a mechanical-engineering degree), Mr. Vaitheeswaran approaches environmentalism with an international objectivity: He judges all parties involved in the debate over oil, America’s resource gluttony as well as Europe’s environmental hypocrisy. He scolds the United States for abandoning the Kyoto climate-change treaty aimed at reducing carbon emissions, and at the same time criticizes European enviros who “used the [Kyoto] opportunity to grandstand” on contentious issues like emissions-trading schemes and allowing forests to be counted as “carbon sinks” that absorb emissions out of the air. He chastises profit-hungry big business and also discredits environmental Malthusians, who wrongly believe that fossil-fuel reserves are perilously low. (Sorry, Ms. Huffington-as a result of breakthroughs in oil-exploration technology, we’ll be able to drive our Hummers well into the next century).

Mr. Vaitheeswaran believes that California’s energy crisis in the summer of 2000 wasn’t a market failure so much as a political debacle. A staunch market advocate, he lambastes poorly instituted reforms such as California’s deregulation fiasco. When California energy prices skyrocketed in 2000, regulators with a “schizophrenic attitude … naively expected the market to sort out other problems of transition all by itself.” Instead, Californians got an energy crisis-complete with rolling blackouts, and manipulated by companies like Enron. Free markets need proactive regulators, Mr. Vaitheeswaran writes, “to ensure that a liberalized market delivers on its promised benefits of efficiency, innovation, and lower prices.”

Mr. Vaitheeswaran’s techno-optimism ignores the political roadblocks that protect the fossil-fuel status quo. When he talks about unleashing free markets, it’s a polite way of saying that Congress needs to enact a fossil-fuel energy tax. “Direct environmental taxation is a … more effective way to level the energy playing field,” he writes. But passing a significant gasoline tax in this S.U.V.-addled country would be political suicide for the measure’s supporters. The first President Bush made this painfully clear at the 1992 Earth Summit in Rio de Janeiro, when he defiantly stated that “the American way of life is not up for negotiation.” The fossil-fuel industry spent more than $3 million on political lobbying between 1999 and 2001 to make sure that his statement played out (Enron gave the Republicans a record $1.7 million, the most of any energy company).

Though he acknowledges that “the entire history of corporate America … is really one of corporatism and cronyism,” Mr. Vaitheeswaran fails to prescribe concrete solutions such as campaign-finance reform that would relax the oil industry’s grip on Washington. For the “happy collision of markets, environmentalism and innovation” to take place, Washington needs to untangle itself from the web of energy lobbyists who work to block new energy-tax legislation. Without dismantling the industry lobbies that fund Washington, there’s little hope for revolutionary energy-tax reform to promote nascent technologies such as fuel cells.

Still, Mr. Vaitheeswaran offers reasons for guarded optimism. Last year, bucking the S.U.V. trend, Toyota sold nearly 20,000 of their zippy Prius hybrid cars, which achieve nearly 60 miles per gallon (but remember that more than 800,000 F-series Ford pickups-America’s best-selling vehicle-were sold in 2002). Antiwar fervor over Iraq has made the fossil-fuel debate more urgent for many Americans, and even Ford’s chairman and chief executive, William Clay Ford Jr. (great-grandson of Henry), broke with Detroit doctrine and predicted that “fuel cells will finally end the 100-year reign of the internal-combustion engine.” We may indeed one day drive shimmering eco-friendly cars, but it just might take another 100 years to get there.

Gabriel Sherman is the Manhattan Transfers reporter for The Observer.