Platinum Supply and the Growth of Fuel Cell Vehicles

This report addresses problems associated with U.S. fuel cell vehicle production and a limited platinum supply. Polymer Electrolyte Membrane (PEM) fuel cells, which use a platinum catalyst, could place strain on the platinum market if fuel cell vehicles are widely produced. We developed a dynamic hypothesis, identified causal relationships, and created a system dynamics model in iThink. Based on this model, we found platinum prices would likely reach $50,000 per kilogram in 30 years and the cost of platinum for a fuel cell vehicle would be $2,500. At this price, the platinum barrier is surmountable if the cost of other FCV components is drastically reduced. If a world FCV market takes hold, it was concluded that only about 15% global market penetration is feasible. 1: Introduction and Background 1.1: Introduction Oil plays a pivotal role in today’s world, accounting for around 36% of worldwide energy use [1]. Unfortunately, many nations have already reached peak oil production and are now producing less and less oil per year. The United States is an excellent example; in 1970, the U.S. oil production peaked at just below ten million barrels per day [2]. Ever since, U.S. oil production has been decreasing; in 2007, oil production was just five million barrels per day. While the U.S. is still a significant oil producer, it is also the largest oil consuming nation on Earth. The United States consumed an astonishing 23.9% of the