Fuel cell power systems, installed at properties such as the Hilton New York, Sheraton San Diego Hotel & Marina, and Mohegan Sun Resort and Casino, have worked reliably for years now but have failed to catch on in a big way throughout the lodging industry.
Cost and availability of funding have certainly been reasons and the recent recession certainly has not helped. A lack of a serious marketing push by suppliers has contributed to the technology’s slow acceptance and systems have also not been available for smaller hotels. Some recent developments, however, could make fuel cells a more attractive option for the lodging industry.
The first development is the availability of smaller power systems. ClearEdge Power, Hillsboro, Ore., for example, is now offering a 5-kilowatt system. A little smaller than a refrigerator, the ClearEdge5 is now available in California. The company, which has grown from 33 employees in January 2009 to 150 employees today, will be expanding its business outside of the Golden State by early 2011. Michael Upp, vice president of marketing for ClearEdge Power, says the ClearEdge5 is ideal for B&Bs, boutique hotels and properties up to the size of a Four Points by Sheraton. The ClearEdge5 provides an alternative to the larger systems—up to more than 2 megawatts in size—that companies like FuelCell Energy, Inc., Danbury, Conn., and South Windsor, Conn.-based UTC Power offer. Up to five or six ClearEdge5 systems can be grouped together to create an up to 30-kilowatt plant. (Larger systems offered by FuelCell Energy, Inc. and UTC Power can also be grouped together to meet a property’s power needs.)
Another development is the availability of financing programs that make it easier to purchase a fuel cell system. California, for example, offers a Self-Generation Incentive Program (SGIP) rebate. States such as Connecticut, New York, Massachusetts and New Jersey also offer incentives. (See www.dsireusa.org/incentives/ for list of incentives by state). The Property Assessed Clean Energy Program (PACE) is available in 22 states and is a creative way to finance renewable energy projects with zero upfront dollars. According to FuelCell Energy, the Energy Policy Act of 2005 provides substantial financial incentives for fuel cell power plants. Specifically, it grants a federal investment tax credit of 30 percent or $3,000 per kilowatt (whichever is lowest) of total project costs, as well as five-year accelerated depreciation.
Power Generation Process Explained
Fuel cells are electrochemical devices that combine fuel with oxygen from the ambient air to produce electricity and heat, as well as water. The fuel used is typically natural gas but other gas sources can also be used. Heat from the electricity generation process can be used to heat hot water or provide building heat. According to ClearEdge Power’s Upp, to reduce installation costs, ideally one would locate their system closest to the main electric panel and where the heated water would be used—a swimming pool or spa, for example.
Using fuel cell systems eliminates much of the inefficiency of coal and other fossil fuel powered plants. The electricity needs to travel only a short distance from the plant to the point of use and much less carbon dioxide and other pollutants are produced. According to Erik Robie, regional sales manager for UTC Power, most power plants that generate electricity are about 33 percent efficient whereas on-site fuel cell power systems can be 42 percent efficient. “When byproduct heat is used, a system can be close to 90 percent efficient,” he says.
Fuel cell systems are also much more water efficient than power plants that use coal or other fuel sources. In fact, fuel cells actually produce water. The overall positive environmental comparison to other means of electricity generation depends on the location of the installation. For example, in areas where electricity is generated from hydroelectric plants, the environmental comparison would not be as dramatic; in areas where electricity is generated from coal or other dirty sources, the argument for fuel cell power would be much stronger.
Unlike solar and wind systems, fuel cell plants can run 24/7 without interruption, even when the power grid goes down. Fuel cell systems also provide cost savings. According to David Prost, director of engineering at the 1,053-room Sheraton San Diego Hotel & Marina, that hotel has been able to generate electricity at a cost 5 to 10 percent less than what the local utility would charge. The hotel currently has six 250-kilowatt fuel cell plants on the property able to generate 1.5 megawatts of electricity. The plants were manufactured by FuelCell Energy.
Waste Heat Pays Dividends
Prost says the Sheraton San Diego Hotel & Marina’s system is owned and managed by an outside company. Seventy percent of the property’s electricity demand is met by the fuel cells and waste heat is used to heat water for the hotel’s Bay Tower and the water in the 110,000-gallon swimming pool in the Marina Tower. “There is still more heat we can capture,” Prost says.
“We enjoy having them here,” Prost adds, regarding the fuel cell plants. “We are pursuing LEED certification. We try to do everything possible that is green. They are a great thing to market. They are great for the environment.”
At the Hilton New York, where a 200-kilowatt, 40,000-pound PureCell system from UTC Power has been up and running for almost three years, Mike Smith, directory of property operations, is just as bullish about the technology.
“It’s been working very well,” Smith says. “It is so quiet you would not even know it is there. We go through periodic maintenance by UTC. They monitor it online. From our side it is seamless.”
Six Percent of Electricity Needs Met
The PureCell system provides, on average, about 6 percent of the 1,980-room Hilton New York’s electricity needs. The system is owned by the hotel’s owners. Waste heat is used to preheat the temperature of the hot water used in the hotel (before final heating) by 30 degrees. This saves a significant amount of energy. Smith says he is currently looking at ways to recover waste heat for the heating of guestrooms in the winter.
According to Homer Purcell, manager of stationary fuel cell sales for UTC Power, for companies selling large fuel cells, the challenge today is to find a facility that is large enough to be able to maximize the use of a fuel cell plant’s waste heat. Hotels that do not have their own laundry facilities or that use portable heating and cooling systems such as PTACs tend to not be a good fit.
Getting the cost of large systems down is also a challenge, UTC Power’s Robie says. “State funding won’t be around forever,” he says. “Reducing the cost of the technology is challenge No. 1. We are still a few years away out on that.”
For companies like ClearEdge Power, which have developed a much more compact system for hotels, market adoption should be much faster.
This article first appeared on the Green Lodging News website.