[miningmx.com] — THE “rah rah’ statements delivered at COP17 on the subject of fuel cells by Anglo American CEO Cynthia Carroll and Anglo American Platinum CEO Neville Nicolau have given me a horrible feeling of deja vu.
I’ve heard it all before you see – back in the mid-80’s to be precise – from a different cast of executives who have since moved on and whose optimistic predictions turned out to be dead wrong.
I have been covering the mining industry for longer than I care to remember, even though I have not been around “since the rinderpest’ (1896 for those who don’t know their South African history) as some of my so-called friends and colleagues have alleged.
In 1984 I was the mining editor on the Rand Daily Mail and even then platinum company executives used to talk in hushed tones about the “exciting long term potential” of the fuel cell for platinum demand.
Such talk/speculation/wishful thinking continued for more than a decade with little to back it up in terms of concrete developments but it reached a crescendo in the late 1990’s and early 2000’s.
Motor giants Ford and DaimlerChrysler bought equity in a Canadian hi-tech group Ballard Power Systems which claimed to be on the brink of commercialising the fuel cell and relegating the internal combustion engine to the scrap heap.
In November 1999 the Annual Review of Energy and the Environment ran a paper which claimed that “significant work is still necessary, but intensified research and development activities could lead to the dawn of fuel cell commercialisation and widespread use in the early part of the twenty-first century”.
So, that would be about now then?
Barry Davison – then the MD of Amplats – put it even more strongly when I interviewed him for the Financial Mail Top Companies survey in 2000.
Davison maintained that platinum was the metal for the new millennium: “I believe the commercialisation process of the fuel cell is now irreversible and it will be a long-term demand kicker for the platinum industry.”
Of course the future, generally, looked very much brighter for SA’s platinum mines at that stage than the way things eventually turned out.
Davison had at the time announced Amplats’ intention to expand its platinum production to 3.5 million ounces per year, from around 2 million ounces. Sidekick John Dreyer – then Amplats new business director- had responded at a results presentation: “Barry, you pick a number and we can deliver it.”
If only! Amplats was forced to cut that expansion target back to 2.5 million ounces annually because of a combination of changed market conditions and the organisation’s inability to deliver the goods.
The vehicle-based fuel cell did not happen, because internal combustion engines became more efficient and battery technology advanced to the point where hybrid cars like the Toyota Prius became commercially viable.
Speakers at the Modern Energy conference held in Denver last year stressed that fuel cells were more expensive and less reliable than battery technology and inherently less efficient.
That assessment jibes with the views of Carroll who told the COP17 conference that “hydrogen fuel cells using platinum catalysts are efficient, versatile and scalable. They represent a proven technology that provides clean, reliable and cost-effective power”.
In the car industry the current technological focus is on raising the capacity of the batteries being used and speeding up the rate at which they can be recharged. The key metals required are vanadium, lithium and certain of the rare earth metals.
Fuel cells have been relegated to niche applications such as powering forklift trucks in big warehouses as well as certain types of busses. The reason for this is that the required back-up infrastructure – in particular the provision of hydrogen – is far more manageable in these restricted applications.
The latest thinking is that the future of fuel cells now lies in stationary units and stand-alone power plants, running buildings or providing back-up power to key installations.
Carroll said Anglo American has been working with the UK’s Carbon Trust to develop new uses for fuel cells “from powering vaccine fridges in rural clinics to providing heat and power for hospitals” while Amplats is “about to start trialling fuel cells in our underground locomotives and miners’ cap lamps”.
Also, according to Carroll – quoting a Carbon Trust report – “hundreds of thousands of new South African jobs could be created over the next 30 years” given the “appropriate level of deployment and investment in manufacturing, installation and maintenance activities”.
That’s all very admirable. Yes, fuel cells really are as “green’ as they are cracked up to be and, yes, it would be great for South Africa in general and, of course, the platinum producers in particular if this vision were to become reality.
But – at the risk of being called a cynic – I would not hold my breathe over these kind of predictions.
They resonate more like sound bites aimed at the “greenies” on the one hand and the South African government on the other given its fixation with local beneficiation.
