The wind-hydrogen test site has been scaled back to this small shack and several hydrogen storage tanks. (CBC)

P.E.I. will soon launch new research on converting wind power into hydrogen, though the project is much scaled back from what was hoped for a few years ago.

When it was first announced in 2005, P.E.I.'s wind-hydrogen village at North Cape was a $10 million project intended to take a small community off the grid, including producing electricity for homes, the North Cape Interpretive Centre, hydrogen-powered utility vehicles and a tour boat, a local farm and perhaps a fish plant.

The project has since been drastically scaled back. With only about one-third of the original funding, it will now focus more on experiment and less on demonstration. At the core of the project is an electrolyzer, which will take electricity directly from a turbine and use it to break water down into oxygen and hydrogen.

"With wind, you have to use it when the wind's blowing, and the wind is only blowing 40 per cent of the time, so you have to store it," Energy Minister Richard Brown told CBC News Tuesday.

The hydrogen can be stored in pressurized tanks for burning in a generator when electricity is needed and the wind isn't blowing. The electrolyzer has been installed at North Cape, and a 125 kW generator is expected within a month.

The electrolyzer uses electricity to break water down into hydrogen and oxygen. (CBC)

Like wind, hydrogen is considered a green energy source, producing only water vapour when it is burned. Hydrogen is produced in many places in North America using electricity off the grid. This new project hopes to find efficient methods of taking electricity directly from the turbine.

"The only way hydrogen can basically be produced right now is now off the energy grid," said Brown.

"As I understand it, we will be the first [in North America] taking it directly from the turbines."

One of the major goals of the project will be to design automated controls to make the most of the electricity coming off the turbine, which will vary as the wind blows harder or softer.

"To be able to use the wind to feed the electrolyzer," said Mark Victor of the P.E.I. Energy Corporation, "there's not a lot of work been done in other areas or in the past."

The benefits of the project will be felt first in remote areas. Places off the grid that use wind power with diesel generators as backup could become more self-sufficient if an efficient way to produce hydrogen could be developed. The P.E.I. government hopes it will be able to put together a package of wind-hydrogen technology, including controllers developed on the Island, for sale to remote communities and research stations around the world.

In the long term, as the price of fossil fuels rise and wind-hydrogen technologies become more efficient, the project could help P.E.I. become more self-sufficient in energy as well.