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EMD-80-B3 1 (1980-02-21)

handle is hein.gao/gaobabahb0001 and id is 1 raw text is: 


              COMPTROLLER GENERAL~ OF THE UNITED STATQ5
                       WASIINGON- DC. 20548
vys




3-196544                             FEB 2 19  



The Honorable Harley 0. Staggers                       111663
Chairman, Committee on Interstate  f-t
   airI Foreign Commerce
hlouse of Representatives

Dear Mr. Chairman:

      Subject:   iews on the proposed Hydrogen Fue] Develop-
               Vent and Use Act of 1979J(EMD-80-B3)

      In a letter dated October 10, 1979, you requested the
General Accounting Office (GAO) to report on H.R. 5399--The
HyJ rogen Fuel Development and Use Act of 1979. As you know,
thw bi ll would create a comprehensive goal-oriented hydrogen
resoa (ch, development, and deronstraton program managed by
Dep<-rtmcnt of Energy (DOE), and also amend the Internal Rev-
enue Code to provide financial incentives to encourage the
production and use of hydrogen fuel. In response to your re-
quest and discussions with your office, we reviewed the bill
from the standpoint of our past work, hydrogen's potential
for greater use, and current federally funded hydrogen re-
search and development activities.

      In general, although we believe research and develop-
ment on hydrogen fuels and associated energy systems should
be pursued, we have some reservations that passage of this
bill, at this time, may place undue emphasis on developing
hydrogen fuels as a major source of energy. In view of hydro-
gen's uncertain potential as a fuel, we are particularly con-
cerned that the bill mandates a number of specific commercial
demonstrations by January 1, 1985, and provides widespread
financial incentives for encouraging the production and use
of hydrogen. Mandating such demonstrations, in our view,
would tend to set them apart from the normal budgetary review
procedures and lock DOE into specific commercial demonstra-
tions. Some of these may not be very appropriate in the 1985
time frame.

      Our concern in regard to the incentives, as proposed in
 the bill, is that little or no restrictions are placed on
 (1) the type of primary energy source used to produce hydro-
 gen and/or (2) what systems or facilities would qualify for

                                        ~             (307186)

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