and the implications for cogeneration worldwide

Natural gas is the most important fuel for CHP in most parts of the world. The prospects for cogeneration are therefore very much linked with those of gas markets around the globe. Aksel Hauge Pedersen from the International Gas Union discusses the likely future of gas and, thus, on-site power.

A look at the current consumption of energy by regions (Figure 1) makes clear the way developing countries still lag far behind in their consumption patterns compared with developed countries. For example, the rest of the world would need to consume twice the energy it does to bring it to the level of Europe, which as a whole is a moderate energy consumer. This factor is five times to bring it to the level of the US.

Not surprisingly, the International Energy Agency (IEA) predicts a 60% increase in energy demand between 2002 and 2030.1 Oil demand is expected to grow at 1.6% per year, coal demand at 1.4% per year and gas demand at 2.3% per year between 2002 and 2030. This means, for example, that consumption of natural gas is expected to almost double between 2002 and 2030.

The energy industry is thought to be capable of meeting this IEA predicted demand. It has succeeded in doing so over the last 30 years (there was an 87% increase between 1971 and 2002). At current production rates, reserves of oil, gas and coal are estimated at 41, 67 and 164 years, respectively.2

However, other figures in circulation range from a more optimistic to a more pessimistic view. One example concerns the volumes of gas contained in the methane hydrates of the world’s sea beds. If a cost-effective method of extracting this gas could be developed, it would create a supply that would satisfy natural gas demand for several centuries.

Coal is predominantly used in electric power plants (about 70% by volume) and around 60% of the demand for oil is for transportation. Both sectors have enormous growth potential, especially in the world’s emerging economies. Gas demand is rising in all market segments, but the demand for natural gas is highest for electric power generation.


Much attention is on India and China, whose economies are experiencing high growth and each of whose energy consumption is expected to rise accordingly. India and China are expected to consume 3.0–3.5 times more natural gas within the next 15 years, but their market share for natural gas will remain small. Nevertheless, the impact of natural gas consumption in these countries is likely to affect the global market for natural gas.

a snapshot of the development phase

At a taxi-refuelling station in Japan, a fuel cell system not only generates electricity, but also hot water for the car wash

Europe is lagging behind both North America and Japan in the development of stationary fuels cells and should be increasing its research efforts. Thomas Flower discusses the position of development work across the globe, and draws up some recommendations for the EU.

According to the European Hydrogen and Fuel Cell Technology Platform, hydrogen is envisioned to eventually become the primary fuel for the portable and transport sectors, and in the stationary electric power sector it will complement existing fossil fuels. In stationary energy applications, the real benefits of hydrogen can be exploited only with novel technologies such as fuel cells. As an energy source for fuel cells, its primary applications lie in distributed generation, but it could also become increasingly significant through its role in enhancing energy storability.

Fossil fuels are expected to remain the major options for primary power generation at least until 2030. Meanwhile, fuel cell technology can provide the means to utilize these fossil fuels at high efficiencies, and so can significantly reduce carbon dioxide emissions. If fuel cell systems could be commercially available at price levels in the range of €1000–1500/kW for larger systems, then by 2050, we would see the creation of a decentralized electricity generation infrastructure powered by a broad spectrum of renewables and clean technologies with a strong fuel cell component.

Still to be resolved, however, is exactly how hydrogen will be produced, and at what cost.


Stationary fuel cells are now starting to enter the market place in a variety of applications. Fuel cells are being developed for small residential applications, larger industrial and commercial applications, and even for larger utility power plant applications. However, before fuel cells are to be available and cost-effective for central power plants, they must become more widely adopted in smaller applications. Most of the existing or near-term fuel cells use natural gas, the most widely available suitable fuel. A variety of other fuels are used as well – such as opportunity fuels including digester gas, landfill gas and syngas – and hydrogen. All this activity is paving the way for fuel cells to become a technology vital for a future hydrogen economy.