METHANOL ECONOMY disadvantages:

* high energy costs associated with generating hydrogen (when needed to synthesize methanol)
* depending on the feedstock the generation in itself can be not clean
* presently generated from syngas still dependent on fossil fuels (although in theory any energy source can be used).
* energy density (by weight or volume) one half of that of gasoline and 24% less than ethanol[5]
* corrosive to some metals including aluminum, zinc and manganese. Parts of the engine fuel-intake systems is made from aluminum. Similar to ethanol, compatible material for fuel tanks, gasket and engine intake have to be used.
* hydrophilic: attracts water: in mixture with gasoline this could lead to phase separation and difficulty to start the engine or make it run smoothly
* methanol, as an alcohol, increases the permeability of some plastics to fuel vapors (e.g. high-density polyethylene). [6] This property of methanol has the possibility of increasing emissions of volatile organic compounds (VOCs) from fuel, which contributes to increased tropospheric ozone and possibly human exposure.
* low volatity in cold weather: pure methanol-fueled engines can be difficult to start, and they run inefficiently until warmed up. This is why, a mixture containing 85% methanol and 15% gasoline called M85 is generally used in ICEs. The gasoline allows the engine to start even at lower temperatures.
* Methanol is generally considered toxic[7].Methanol is in fact toxic and eventually lethal when ingested in larger amounts (30 to 100 mL).[8] But so are most motor fuels, including gasoline (120 to 300 mL) and diesel fuel. Gasoline also contains many compounds known to be carcinogenic (e.g. benzene). Methanol is not a, nor contains any, carcinogens.
* methanol is a liquid: this creates a greater fire risk compared to hydrogen in open spaces. Methanol leaks do not dissipate. Compared to gasoline, however, methanol is much safer. It is more difficult to ignite and releases less heat when it burns. The EPA has estimated that switching fuels from gasoline to methanol would reduce the incidence of fuel related fires by 90%.[9]
* methanol accidentally released from leaking underground fuel storage tanks may undergo relatively rapid groundwater transport and contaminate well water, although this risk has not been thoroughly studied. The history of the fuel additive methyl t-butyl ether (MTBE) as a groundwater contaminant has highlighted the importance of assessing the potential impacts of fuel and fuel additives on multiple environmental media. [10]. An accidental release of methanol in the environment would, however, cause much less damage than a comparable gasoline or crude oil spill. Unlike these fuels, methanol, being totally soluble in water, would be rapidly diluted to a concentration low enough for microorganism to start biodegradation. Methanol is in fact used for denitrification in water treatment plant as a nutrient for bacterias.[11]
Source: http://en.wikipedia.org/wiki/Methanol_economy

HYDROGEN ECONOMY:

In 2004, the National Academy of Engineering identified significant problems with a hydrogen economy in, The Hydrogen Economy: Opportunities, Costs, Barriers, and R&D Needs:
“There are major hurdles on the path to achieving the vision of the hydrogen economy; the path will not be simple or straightforward. Many of the committee’s observations generalize across the entire hydrogen economy: the hydrogen system must be cost-competitive, it must be safe and appealing to the consumer and it would preferably offer advantages from the perspectives of energy security and CO2 emissions. Specifically for the transportation sector, dramatic progress in the development of fuel cells, storage devices, and distribution systems is especially critical. Widespread success is not certain. The committee believes that for hydrogen-fueled transportation, the four most fundamental technological and economic challenges are these:
1. To develop and introduce cost-effective, durable, safe, and environmentally desirable fuel cell systems and hydrogen storage systems. Current fuel cell lifetimes are much too short and fuel cell costs are at least an order of magnitude too high. An on-board vehicular hydrogen storage system that has an energy density approaching that of gasoline systems has not been developed. Thus, the resulting range of vehicles with existing hydrogen storage systems is much too short.

2. To develop the infrastructure to provide hydrogen for the light-duty-vehicle user. Hydrogen is currently produced in large quantities at reasonable costs for industrial purposes. The committee’s analysis indicates that at a future, mature stage of development, hydrogen (H2) can be produced and used in fuel cell vehicles at reasonable cost. The challenge, with today’s industrial hydrogen as well as tomorrow’s hydrogen, is the high cost of distributing H2 to dispersed locations. This challenge is especially severe during the early years of a transition, when demand is even more dispersed. The costs of a mature hydrogen pipeline system would be spread over many users, as the cost of the natural gas system is today. But the transition is difficult to imagine in detail. It requires many technological innovations related to the development of small-scale production units. Also, nontechnical factors such as financing, siting, security, environmental impact, and the perceived safety of hydrogen pipelines and dispensing systems will play a significant role. All of these hurdles must be overcome before there can be widespread use. An initial stage during which hydrogen is produced at small scale near the small user seems likely. In this case, production costs for small production units must be sharply reduced, which may be possible with expanded research.

3. To reduce sharply the costs of hydrogen production from renewable energy sources, over a time frame of decades. Tremendous progress has been made in reducing the cost of making electricity from renewable energy sources. But making hydrogen from renewable energy through the intermediate step of making electricity, a premium energy source, requires further breakthroughs in order to be competitive. Basically, these technology pathways for hydrogen production make electricity, which is converted to hydrogen, which is later converted by a fuel cell back to electricity. These steps add costs and energy losses that are particularly significant when the hydrogen competes as a commodity transportation fuel—leading the committee to believe that most current approaches—except possibly that of wind energy—need to be redirected. The committee believes that the required cost reductions can be achieved only by targeted fundamental and exploratory research on hydrogen production by photobiological, photochemical, and thin-film solar processes.

4. To capture and store (“sequester”) the carbon dioxide by-product of hydrogen production from coal. Coal is a massive domestic U.S. energy resource that has the potential for producing cost-competitive hydrogen. However, coal processing generates large amounts of CO2. In order to reduce CO2 emissions from coal processing in carbon-constrained future, massive amounts of CO2 would have to be captured and safely and reliably sequestered for hundreds of years. Key to the commercialization of a large-scale, coal-based hydrogen production option (and also for natural-gas-based options) is achieving broad public acceptance, along with additional technical development, for CO2 sequestration.

For a viable hydrogen transportation system to emerge, all four of these challenges must be addressed.” (Emphasis added)
http://www.nap.edu/catalog.php?record_id=10922#toc

Regarding the hydrogen economy, the U.S. Army Corps of Engineers (2005) concluded that “there are tremendous problems to overcome; once we have solved the production, transmission, and resource issues, then the switch to hydrogen may occur. This is a long term issue and the hydrogen economy is decades away. The tools to make it work, such as safe nuclear reactors, windmills, and fuel cells are still in the development or early adoption phases. To realize the potential benefits of a hydrogen economy – sustainability, increased energy security, a diverse energy supply, and reduced air pollution and greenhouse gas emissions – hydrogen must be produced cleanly, efficiently, and affordably from regionally available, renewable resources.”

http://stinet.dtic.mil/cgi-bin/GetTRDoc?AD=A440265&Location=U2&doc=GetTR...

Clifford J. Wirth
Peak Oil Associates International