STATE OF NEW YORK

EXECUTIVE CHAMBER

GEORGE E. PATAKI, GOVERNOR

Press Office

518-474-8418

212-681-4640

http://www.ny.gov

FOR RELEASE:

IMMEDIATE, Wednesday

October 4, 2006

GOVERNOR ANNOUNCES $21 MILLION DEMONSTRATION PROJECT TO FUEL HYDROGEN VEHICLES AND CREATE NEW HIGH-TECH JOBS FOR WESTERN NY

            Governor George E. Pataki today announced plans for one of the world’s largest hydrogen demonstration projects, a $21 million initiative to harness hydropower to produce clean-burning, carbon-free gas to fuel nonpolluting hydrogen vehicles. The initiative, which will be undertaken in Western New York, is expected to spur development of a new industry for creating high-tech jobs for the region.

            “This ambitious, $21 million initiative will further establish New York State as a national leader in developing innovative energy solutions that will enhance our air quality, reduce our dependence on foreign oil, and create new technology jobs in an emerging industry,” Governor Pataki said. “The demonstration project in Western New York is a renewable power application that will help the transition to a hydrogen economy.  The process will not emit any greenhouse gases or other pollutants, making it a model for meeting the challenge of global climate change, that can be replicated at other locations throughout the State.”

            The hydropower-to-hydrogen project, which is expected to serve a number of hydrogen-fueled work and passenger vehicles and transit buses, corresponds with the New York State Hydrogen Roadmap, a strategic blueprint developed under Governor Pataki’s direction for positioning New York State at the forefront of hydrogen research and development efforts nationwide. The document reflects a coordinated effort by the New York Power Authority (NYPA), the New York State Energy Research and Development Authority (NYSERDA), and the Long Island Power Authority (LIPA), and includes hydrogen education and outreach, hydrogen codes and standards review, and research and development in the areas of hydrogen production, storage, distribution and utilization.

            Timothy S. Carey, NYPA president and chief executive officer, said, “These efforts are a corollary of Governor Pataki’s policies for reducing New York State’s dependence on hydrocarbon fuels for the energy and transportation sector.  Part of his legacy will be the significant strides toward use of renewable energy for combating global climate change, improving air quality and reducing dependence on foreign oil. The hydropower-to-hydrogen demonstration project for Western New York is the latest example of the Governor’s vision for introducing new energy technologies that could have significant effects for enhancing the environment and energy security in the decades ahead, while helping to attract industries engaged in manufacturing and servicing these technologies.”

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Peter R. Smith, NYSERDA president and chief executive officer, said, “Now, more than ever, it is crucial that we look for new ways to strengthen our energy security. NYSERDA is providing $5 million in funding for hydrogen transportation developments in New York State through demonstration

projects involving hydrogen internal combustion engines and the development of hydrogen fueling stations.  Implementing new and innovative technologies to reduce our dependence on foreign oil, while heightening the economy and preserving the environment, is a tremendous focus in New York State.  NYSERDA commends the Governor's vision and the efforts of NYPA to bolster this exciting hydropower-to-hydrogen initiative.”

            On Tuesday, NYPA’s Trustees authorized up to $21 million for the hydropower-to-hydrogen initiative, with potential sites at Niagara Falls State Park and at Western New York locations operated by the Niagara Frontier Transportation Authority (NFTA). Various other state and federal government organizations and corporations are also expected to partner in the pioneering project, with hydrogen production anticipated by the end of 2007.

            The NYPA board’s action followed an engineering feasibility study earlier this year by the Power Authority and the Electric Power Research Institute (EPRI), for determining the size of the electrolysis units for producing hydrogen and the possible vehicle demonstration models for the initiative, with fuel cells and other hydrogen engines. (EPRI is an independent, nonprofit organization for energy and environmental research.)

            When fully implemented within three years, the demonstration project, consisting of two hydrogen generation stations, plus storage and fueling facilities, will be producing up to 120 kilograms (kg) per day of the clean-burning fuel. (One kg of hydrogen has the energy equivalent of approximately one gallon of gasoline.)

            The hydrogen generation and fueling stations will use up to 700 kw of hydropower. The Power Authority would provide the hydropower from its Niagara Power Project to the NFTA, which is authorized to receive NYPA allocations under state law. The agency currently receives hydropower allocations for a light-rail system and the Niagara Falls Air Base.

            The hydrogen generation stations will cost approximately $7.5 million, including infrastructure upgrades and educational displays. An additional investment of $13.5 million is required for the hydrogen-fueled vehicles.

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