Posts

Going With The Flow

In recent months, I’ve come across more work being done in flow batteries than I’ve seen in the prior decade.

I’ve been known in the past to say that fuel cells are kinda like fueled batteries.  Well, flow batteries really are fueled-batteries.  A traditional chemical battery is one sealed system that charges and discharges chemical elements through a set of electrodes, and the amount of charge/discharge is dictated by the type and volume of chemistry within the battery.  In contrast, a flow battery separates the electrodes from the chemistry, which is stored externally from the electrodes in tanks.  In so doing, a flow battery delinks the relationship between power (an instantaneous concept) and energy (power over time) that is essentially hard-wired within a chemical battery.  In a flow battery, it’s straightforward to expand the energy of a system by adding more to the storage tanks.  And, it’s straightforward to add more “fuel” by injecting more of the reactants into the storage tanks.

Because of this, it is natural to think about how flow batteries can improve the range of electric vehicles, which is the focus of this 2009 article from The Economist.  However, energy density remains a challenge that could limit the utility of flow batteries for vehicular purposes. 

Several flow battery concepts involving different chemistries are being worked on by a number of academic researchers.  DOE’s advanced energy R&D shop ARPA-E awarded a team from Lawrence Berkeley Labs to pursue flow batteries.  Commercially, perhaps the three most well-known flow battery technology development companies are ZBB (NYSE MKT: ZBB), RedFlow and Primus Power.

Most of these efforts are targeting to apply flow batteries in grid-scale electricity storage at the substation level.  This could be an even more impactful role for flow batteries than their use in vehicles:  if flow batteries can provide an economic solution for grid-storage, the implications for expanded renewable energy deployment — enabling intermittent wind and solar energy to achieve more than 15% share of power generation — are possibly massive.

Shell uses Hydrogen Pipeline for Fuel Cell Cars from Toyota, Honda and Mercedes

Shell Daimler CaFCP Shell uses Hydrogen Pipeline for Fuel Cell Cars from Toyota, Honda and Mercedes

Shell Opens Third Hydrogen Station in Southern California

Shell announced the opening of a new demonstration hydrogen station in Torrance, California, the first in the US to have hydrogen delivered to the site directly from an existing underground pipeline. Excess hydrogen is typically available on the hydrogen pipelines used by oil refiners. Hydrogen is used to provide cleaner gasoline and diesel. Although hydrogen is most often reformed from natural gas, it is also available from the electrolysis of water wastewater treatment byproduct, and chemical plant byproduct.

Southern California has been the center for test deployment of hydrogen fuel cell cars. The West Coast has been the area of greatest use of hydrogen fuel cell buses, including the 20 hydrogen buses in Whistler, Canada that transported about 100,000 visitors during the last Winter Olympics.

Hydrogen fuel cell cars provide a way to give an electric car a range of up to 400 miles with hydrogen PEM fuel cells that supply added electricity to an electric drive system. GM successfully piloted 100 Equinox fuel cell vehicles during its Project Driveway. Toyota is planning to test 100 new fuel cell SUVs as it prepares for 2015 commercialization. Toyota FCHV Test Drive. 200 of the new Mercedes-Benz B-Call F-CELL are being put into use. Several automakers are targeting 2015 for the commercialization of fuel cell vehicles.

50,000 Commercial Hydrogen Cars by 2017 from Toyota, Honda, GM, Mercedes

Between 2008 and 2010, the fuel cell industry experienced a compound annual growth rate (CAGR) of 27%  according to the new Fuel Cells Annual Report 2011 from Pike Research. The California Fuel Cell Partnership forecasts over 50,000 hydrogen vehicles on California roads by 2017.

“Shell is pleased to be an active participant in the development of hydrogen-fuelled transportation, one of a small number of options to reduce road transport emissions in the longer-term,” said Julian Evison, General Manager of Operations for Shell Alternative Energies.  “Demonstration hydrogen filling stations allow us to evaluate a range of different technologies and learn valuable lessons about costs, consumer behavior, how to safely store hydrogen at different pressures and how to dispense it efficiently to different vehicles.’’

Initially, Shell expects 10 to 12 drivers to fill their tanks each day at the Torrance station’s two pumps, which provide hydrogen at both 350 bar (5,000 psi) and 700 bar (10,000 psi) pressure. Current fueling capacity is 48 kg. of hydrogen per day, equivalent to dispensing 48 gallons of gasoline. To exceed 200 mile range, most new fuel cell cars require 10,000 psi. Honda is the sole achiever of long-range at 5,000 psi with the Honda FCX Clarity. Only a handful of California stations support the high pressure fueling.

The close proximity of the hydrogen pipeline to TMS campus led Toyota to think beyond vehicles to consider additional ways to use hydrogen. In 2010, Toyota partnered with Ballard Power Systems to install a one-megawatt hydrogen fuel cell generator to offset peak electricity demand on campus. The fuel cell generator will be fed directly from the hydrogen pipeline through an existing tap on the TMS property. Pipeline hydrogen used on campus will be offset with the purchase of landfill generated renewable bio-gas.

The stand-alone station in Torrance offers only hydrogen and will be open 24 hours a day. Local fuel cell vehicle drivers will be trained to use the dispensers using personal access codes. The station is located on land provided by Toyota at the perimeter of its US headquarters.

Shell Delivers Hydrogen 24×7

“Vehicle demonstration  programs  and  demonstration  stations  like  the Torrance  station  are  a  critical  next  step in preparing the market for advanced  technology  vehicles,”  said Chris Hostetter, Toyota GVP of Product and Strategic Planning. This is the third demonstration station Shell has developed in the region. Shell opened the first integrated gasoline/hydrogen station in California in 2008 (in West L.A.) and a smaller sister station in Culver City in 2009. Shell is planning on building a hydrogen refueling site at one of its gas stations in Newport Beach later this year.

The station has been anticipated for years due to the potential of pipelined hydrogen to be less expensive than gasoline. It is now open after years of delay thanks to support from Toyota and Shell, who were not initial project partners. The much touted California Hydrogen Highway was never funded.

In addition to Shell Hydrogen and Toyota, project partners for the Torrance hydrogen demo station include Air Products, the US Department of Energy and the South Coast Air Quality Management District.

Intelligent Energy Raises £7 Million to Accelerate Commercialisation Plans in Further Material Up Round

Loughborough UK, 14th April, 2011 – Intelligent Energy, the global clean power systems company, today announced it has recently completed a fundraising round of approximately £7 million ($11 million) from existing and new institutional shareholders. This investment, achieved through a placement at £1.70 per share, enables Intelligent Energy to accelerate the commercialisation of its advanced fuel cell power systems.

“This material up round helps us to further accelerate the commercialisation of our clean power systems,” commented Dr. Mark Lawson-Statham, Director of Corporate Finance at Intelligent Energy. “We are experiencing real customer pull for our fuel cell power systems across our market segments. This is not surprising, as like us, a number of our partners and customers are seeing major commercial tipping points across the automotive, consumer electronic, backup power and combined heat and power markets.”

Late last year, the company announced its joint venture with Scottish and Southern Energy, IECHP (UK and Eire) Ltd., had received a £3.7 million investment from Scottish and Southern Energy, Scottish Enterprise and Intelligent Energy, to continue the development of fuel cell combined heat and power (CHP) systems for residential, commercial and light industrial markets in the UK and Ireland.

“Volatile oil prices and the fragility of our current energy infrastructure, further highlights the need for clean and reliable energy technologies,” said Dr. Henri Winand, Chief Executive of Intelligent Energy. “This investment allows us to continue the commercialisation of our fuel cell technology, some of which is already undergoing public road testing. Our Fuel Cell Black Cabs have debuted on the streets of London, while the Suzuki Burgman Fuel Cell Scooter recently obtained European Whole Vehicle Type Approval – a first for any fuel cell vehicle.”

About Intelligent Energy

Intelligent Energy is a global clean power systems company, with a range of leading fuel cell and hydrogen generation technologies. The company partners with leading global companies in the transportation, oil and gas, aerospace, defence, distributed generation and portable power markets. Current partners and customers include Scottish & Southern Energy plc and The Suzuki Motor Corporation, with whom Intelligent Energy built the Burgman Fuel Cell Scooter, a recent recipient of European Whole Vehicle Type Approval, which qualifies the scooter as safe to use on EU public roads. Other successes include developing the world’s first hydrogen fuel cell motorbike and supplying the fuel cell system to Boeing which powered the world’s first manned fuel cell aircraft.

Hydrogen: The Fuel of the Future. Will It Always Be Thus?

by Richard T. Stuebi

For years, the utopian vision for powering humankind’s energy requirements has been based on hydrogen, produced by decomposing ever-abundant water (H2O), via renewable sources of power (e.g., sunlight). When hydrogen is used in fuel cells to produce electricity on-demand, the only by-products of the chemical reaction are water vapor and pure oxygen. In other words, an energy cycle that is infinitely sustainable (at least as long as we have a sun).

Of course, there are a number of well-documented challenges to achieving the so-called hydrogen economy. Producing, transporting and storing the hydrogen are all expensive relative to the current conventional energy approaches — and require a major change-out of infrastructure, which would entail a massive societal investment. Fuel cells also remain expensive, due to high materials costs and short lifetimes, until further engineering obstacles are overcome.

With this as backdrop, it’s interesting to read “Sun + Water = Fuel”, an article in the current Technology Review. The article profiles the work of Daniel Nocera, a professor of chemistry at MIT, who claims to have discovered a catalyst that facilitates a reaction in which oxygen is generated from water by sunlight — making, in effect, an artificial leaf. Of course, if one produces oxygen from water, one is also producing free hydrogen.

Therefore, Prof. Nocera is suggesting that he is on the verge of discovering how to produce hydrogen from water via sunlight. If true, this would be a major breakthrough towards the hydrogen economy, dramatically simplifying the hydrogen production, storage and transportation issues, because water and sunlight are respectively inexpensive and free — not to mention almost ubiquitous.

That being said, we must be cautious to avoid getting prematurely overexcited. To illustrate, let’s not forget the promising claims made in 1989 by Pons and Fleischmann of cold-fusion: twenty years hence, and other than lots of controversy, not much to show for it. And, even if Prof. Nocera is really onto something, there’s still the little issue of repairing hydrogen’s public reputation in the wake of the Hindenburg disaster: seventy years later, and many urban legends about hydrogen’s dangers still linger, as in this recent satire.

This reveals a constant occupational hazard for those of us who work in the cleantech field: things just don’t change as fast as we often would like for them to change. In the case of hydrogen, many things must change, and some of the changes — technical, institutional and cultural — must be profound, for hydrogen to become a major actor in the world’s energy economy. I hope that day comes far sooner than I frankly expect it will.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Solar Rises 10.8%, Renewable Elec and Biofuels increase also (week ending 5/16)

Author: Mark Henwood

Broad market indices (Emerging Markets, EAFA, S&P500) all rose significantly this week. Camino’s PurePlay™ indices, with the exception of Fuel Cells, were up. Commodities (DJP) retreated slightly.

Solar was the story of the week with our 34 member index increasing 10.8%. Six constituents rose more than 20% with the top three, SolarFun Power (SOLF), Renesola (SOL), and China Sunergy (CSUN) increasing more than 40%. Renesola reported strong Q1 results on the 14th. SolarFun and China Sunergy are scheduled to report earnings next week.

Even after its 53.85 % price increase last week, SolarFun’s current year PE is 32.2 (corrected) and its 09 PE is 19.5 (corrected). With continued high growth rates expected, and unless there is a negative surprise next week, I wouldn’t be surprise to see this stock rise further. Renesola’s current year PE is now 22.3 but with expected growth in the 50% range it may support a higher price also. China Sunergy’s 44.9% increase is harder to understand. The company isn’t profitable this year and has a 09 PE of 32. Offsetting this are consensus expectations of revenue growth of over 50% this year and next.

After last weeks big gain at Energy Conversion (ENER) the stock rose an additional 19.2%. Other then hope for an ITC extension in the US I didn’t see any events specifically related to the company that would drive this change. The stock is in both of the solar ETFs so money flowing into them may have lifted the stock last week. At a current period PE of about 80 I can’t justify owning it.

Biofuels bounced up 4.9% last week. Some of the gain was no doubt driven by oil prices but some was driven by the 27.3 % increase in Brasil Ecodiesel (ECOD3.SA). The company reported a significant block transaction of stock during the week. Next week we’ll look at the correlation of this strategy with oil prices.

Fuel Cells continued to suffer with Medis (MDTL) leading the decline. The company reported an increased YoY quarterly loss. This strategy is now down 33% of the year and is still searching for the winning product mix.

LED & Lighting is a new strategy being tracked at Camino. It consists of 9 companies that pass our screens and are producers of energy efficient lighting using LED, flourescent, or other technologies. We expect this sector to grow as technical improvements and rising retail electric prices make advanced lighting more compelling to customers.

In total our five indices, which track just PurePlay™ sustainable energy companies, have aggregate market capitalization of USD 227 billion.

Mark is the founder of Camino Energy, an information provider specializing in globally traded sustainable energy stocks. He also is an investor in sustainable energy stocks.

Only Renewables Gain (Week Ending 4/25) + Solar ETFs

Author: Mark Henwood

Broad market indices were mixed this week and so were Camino’s PurePlay™ indices.

The Solar index followed last week’s 7.0% gain with a small 0.2% decline. The index members were also mixed with 15 stocks increasing and 19 stocks declining. Most notable in the group was Centrosolar (C3O.DE) which gained 26.2% for the week. The stock jumped on the 23rd after the company announced provisional results that were above expectations. Sales for the quarter were up 86% over the previous year and EBITDA almost tripled. One analyst suggested the stock was undervalued.


Camino’s Renewable Electricity index managed a small 0.1% increase with 8 stocks climbing and 15 retreating.


Biofuels reversed last week’s 1.5% gain with a 1.9% loss. There were 7 advancing stocks to 8 stocks falling. Several of the ethanol stocks (AVR, PEIX, VSE) seemed to benefit from coverage by Oppenheimer whose analyst believes that overcapacity in the sector will resolve itself in the next 12 to 18 months.

Fuel Cells slumped 5.1% on 1 stock advancing and 6 stocks declining. FuelCell Energy (FCEL) reported a sale to Posco which was well received by the market resulting in a 11% price increase for the week. The sale involved delivering 25.6 MW at a contact value of USD 70 million, or over USD 2,700 / kW. Analysts believe this number is below cost but will help the company reduce its cost. After years of losses FuelCell needs to get it right and get its costs down so it can compete in a very competitive natural gas fired electric generation market.

Solar ETFs It came as no surprise that solar ETFs have been launched by Claymore (TAN) and VanEck (KWT). These two providers worked hard to differentiate their products by using slightly different company selections and weighting schemes. Unfortunately they didn’t decide to compete on cost coming out at an identical 65 basis points.

The result is indices that have a 74% overlap in their 27 constituents. Between the two indices the only company not included in Camino’s Solar index (34 constituents) is MEMC Electronics (WFR). By our computation in 2007 at most MEMC has a 25% exposure to solar so we’re not sure why Claymore included them. We don’t think they currently belong in our PurePlay™ index.

Going forward we expect these ETFs will have comparable performance and very high volatility. We routinely calculate Sharp ratios for our indices in an effort to assess the risk/reward profile of the sector. Over the last 365 days our solar index’s Sharpe ratio was 0.8 and over the last two years the ratio was 0.48, both periods measured against the 13wk T-Bill. Traditional fund managers would probably not find these values attractive particularly considering their high beta. That said, we think there are plenty of opportunities in the sustainable energy sector.

Mark is the founder of Camino Energy, an information provider specializing in globally traded sustainable energy stocks. He also is an investor in sustainable energy stocks. Mark has no positions in solar.

The Best Fuel Cell Company You’ve Never Seen

I had a chat with Dr. Peter Podessor this week. He is the CEO of Smart Fuel Cells (XETRA: F3C.DE), the best fuel cell company that most Americans have never heard of. Cleantech Blog did an article on the problems with micro fuel cells last year, but we have never written much on the larger size methanol fuel cells that Smart Fuel Cell is developing. SFC is one of the longest running direct methanol fuel cell companies in Europe, but never has made much press in the US, despite the fact that the US is one of their largest markets.

It has been nearly five years since I last had the chance to speak with Smart Fuel Cell founder and then CEO Dr. Manfred Stefener, and a lot has changed. That is to say, unlike almost every other fuel cell company I know of, they have actually done what they said they would five years ago.

The technology is direct methanol, where methanol mixed with water is fed directly into the fuel cell. Their products are medium power range systems, mainly for APU type applications. An interesting tidbit on the technology, the classic problem in DMFC has always been the crossover problem, where methanol seeps through the membrane, reducing efficiency and performance, among other things. SFC uses a patented water management and active control system that has permitted them to deliver commercial products using membranes from a range of suppliers, including Johnson Matthey, DuPont and Cabot Industries, apparently relatively indiscriminant of the membrane itself.

These results (the combination of good performance, long life, and a range of membranes) are certainly interesting enough that I asked them after the interview to comment in more detail on what they mean by active crossover control, and share what they can about how it works:

“SFC has patented a method of converting energy using fuel cells that allows for miniaturization by focusing on simplified fuel intake, sealing and electrical configuration. We have also used low-cost materials and mass production techniques to lower the cost of manufacturing fuel cells. “Active Crossover Control” by SFC permits active monitoring and minimization of the negative methanol crossover effect, thus upping the fuel cell’s performance. The result is an extremely short startup time and highly efficient fuel cells by SFC. A mixture of methanol and water is introduced to the anode side by a patented internal water-management system. This enables us to employ 100% pure methanol in our fuel cartridges.”

Our technology is an “active” style DMFC with water and air management by pumps and crossover control permitting the use of various types of membranes. The fuel cell uses 100% methanol supplied in convenient, safety-tested and certified cartridges and dilutes it to the mix ratio required for power production.

Is there a simple summary on how the water management & active crossover control works? Active crossover control means advanced algorithms that manage fuel crossover and adapt it to the particular situation’s needs. When fuel crossover is not desired, it is reduced to about 2 per cent. In situations when fuel crossover is beneficial to the product, it is deliberately increased. – SFC’s water management submodule regulates the water balance of the product by matching water emissions and water recirculation. This process and the device performing the functions work reliably in a very wide window of operating conditions and are protected by several patents.”

They have over 7,500 fuel cell units sold. The products range from 600 to 1,600 watt hours per day in size (25 to 65 watt nominal power), with prices ranging from 2,000 to 4,000 euros. The system efficiencies are rate at 30%. A bit over 40% of revenues are from the recreational market, predominantly including APUs for RVs, including major manufacturer names like Hymer and Concorde, and 40% of the total revenues are into the US and European military customers for remote power systems and mobile power packs. Among the other intriguing applications they have developed include solar / battery / fuel cell hybrid power systems for off grid power solutions. They have also begun making initial inroads into the EV and hybrid vehicle market for light vehicles as well. SFC warranties a 3,000 hour life of the system (they estimate roughly 6 year life expectancy in a typical recreational vehicle application), though they cautioned me that many of the systems see several times that in practice.

SFC’s private equity backers included leading European private equity group 3i, strategic investor DuPont, and institutional backing from Deutsche Bank. SFC is publicly traded now, and after a fairly fast run up from 37 euros to north of 50 euros when it first went public in 2006, the stock has dipped back into the low to mid teens. That gives it a current market capitalization of around 100 mm euros, with around 50 mm euros of cash and 14 mm euros in revenues (including 70% from product sales) with a loss in 2007 of less than 5 mm euros. Possibly even more impressive, according to Dr. Podessor they have given guidance that they expect to break even in 2008. Aside from the technology, at an enterprise value to trailing revenues of 3.5x, plenty of cash, and projecting a near term breakeven, it is hard to see how SFC is not one of the cheapest fuel cell stocks out there, as well as with 7,500 units sold, one of the most mature. For someone who has been a long time skeptic of fuel cell companies, Smart Fuel Cell is a refreshing story.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog, a Contributing Editor to Alt Energy Stocks, Chairman of Cleantech.org, and a blogger for CNET’s Greentech blog.

Only Renewable Electricity Stocks Advance (Week Ending 4/11)

Author: Mark Henwood

Sustainable energy stocks followed the broader markets down this week with only Renewable Electricity able to show a gain.

The Solar index followed last week’s 14.5% advance with a 4.7% decline. The retreat was broad-based with only 4 stocks increasing and 30 stocks declining. Aloe Solar SG (AS1.DE) led the declines falling 13.1% for the week despite positive news on April 3 that it’s production expansion was on track and it had received orders in 2008 for EUR 150 million. With First Solar (FSLR) also falling 3.5% the decline was not limited to the silicon world as some commentary alluded to. Without extraordinary news to push the sector down the relatively modest change for this highly volatile group seems to be primarily driven by broader market movements.


In the Renewable Electricity sector Camino’s index advanced 0.3% with 14 stocks climbing and 9 retreating. German wind farm developer Planbeck Neue Energien Ag
(PNE3.DE) led all increases with a 13.1% gain. On March 31 the company reported on 2007 results and conducted a press and analyst conference. The company reported a solid pipeline and positive news about its wind blade subsidiary SSP Technology. While the stock price didn’t react for a few days it looks like this week’s price gain is a reaction to the recent news.

Biofuels reversed last week’s small gain with a 7.5% decline culminating in a YTD decline of 32.4%. There were 3 advancing stocks to 12 stocks falling. Aventine (AVR) led the way down lowering 23.1 % for the week. 9.5 % of the decline occurred Friday after a USB analyst lower their target price due to concerns over corn prices and shrinking margins. Aventine is now valued at USD 0.97 per gallon of production capacity. This compares favorably with VeraSun’s (VSE) value of USD 0.67 per gallon of production capacity (after this year’s 5 new plants start-up). If it is possible to make any money producing ethanol, the company valuations have to be getting low enough to be attractive.


Fuel Cells also reversed last weeks gain with the index falling 2.2% on 1 stock advancing and 6 stocks declining. Ceramic Fuel Cells LTD
(CFU.L) kept the index from falling further with its 13.6% gain for the week. We found no public news that would explain Ceramic’s being able to move counter to the market unless these are second reaction to the company’s Feb 28 order announcement. ITM Power (ITM.L), on the other hand, continued to lose ground with a 12.4% decline. I share the market’s skepticism about the impact of the company’s recent electrolyzer development.

Solar continues to move with the broader markets, all of which were down for the week. With its high beta over any period during the last 500 days the index’s performance this week is to be expected. Biofuels continue to be plagued by questions regarding profitability. Clearly, getting bigger, like VeraSun did with it’s acquisition of US Bioenergy, isn’t perceived as materially helping the basic operating cost issue. At some point stock prices for Biofuel companies will get low enough to present a compelling price / cash flow return and investors will start taking positions.

Mark is the founder of Camino Energy, an information provider specializing in globally traded sustainable energy stocks. He also is an investor in sustainable energy stocks. Mark has a position in PNE3.DE

The Week in Sustainable Energy Stocks (Week Ending 3/14)

Author: Mark Henwood

The Dow traded in a 569 range this week reflecting negative credit market news and strong intervention by government institutions. Global results were mixed with EAFA advancing and the S&P and Emerging Markets declining. The final changes were not dramatic. This translated into mixed results for the Camino indices with three indices retreating and one, Solar, advancing.

The Solar index increased 1.8% bringing the YTD decline for the sector to –41.5%. LDK Solar Co. LTD (LDK), which fell 21.3 % last week, led all stocks in the index with a 16.3% increase. Most of this gain happened Thursday and Friday after the company’s press release reported it had sold 100% of its 2008 production and 90% of 2009. The communication also shed some light on the inventory issue. This strong sales picture may be supportive of the view that demand for PV product hasn’t been affected much by larger economic concerns. Overall the sector had 19 stocks climbing and 14 stocks falling.

Biofuels experienced a 1.9% decline with 6 stocks rising and 10 stocks falling. Gushan (GU) was the leader recovering 7.5% after last weeks 24.9% decline. On the declining side, Schmack Biogas (SB1.DE) led the field with a 11.6% decrease. This may be a delayed reaction to the company’s 2/26 release of 2007 results where strong sales growth (47% !) was coupled with a wider than expected loss. VeraSun (VSE) and US BioEnergy (USBE) also suffered steep declines after VeraSun reported on Wednesday that ethanol prices weren’t increasing as fast as corn costs. Getting bigger with the merger isn’t going to change that equation.

In the Renewable Electricity sector Camino’s index retreated 0.5% with 8 stocks climbing and 11 retreating. Geodynamics Ltd. (GDY.AX) led the pack with a 17.2% decline. The only news we found was an ASX note on 3/11 that a flow test had been delayed until 3/14.

Fuel Cells had another down week with the index decreasing 3.2% on 3 stocks advancing and 4 stocks declining. ITM Power (ITM.L) suffered a 25.2% decline. On Feb 5 Citigroup criticized the company’s unfocused business strategy and apparently the company’s 3/14 announcement of a testing contract with Bi-Fuels did little to sharpen the strategy.


What did I learn this week? Traders are listening carefully to company communications and are very quick to take decisive action on news, both positive and negative. I also think LDK’s order news may be significant as a bell weather for overall demand in the solar sector.

Mark is the founder of Camino Energy, an information provider specializing in globally traded sustainable energy stocks. He also is an investor in sustainable energy stocks. Mark holds a position in GDY.AX .

The week in sustainable energy stocks (ending 3/7/08) ….

By Mark Henwood

Continuing concerns with economic conditions drove all the broad stock indicators into negative territory for the week. With one expectation our sustainable energy indices followed suit with three indices retreating and one, Renewable Electricity, advancing.

The Solar index suffered another large drop of 5.9% bringing the YTD decline for the sector to –42.5%. In perspective, even with this large YTD decline the index has 46% to give up before it losses all of the huge gains in 2007. LDK Solar Co. LTD (LDK) led the move downward falling 21.3% and closing below its IPO price. Apparently there remains some lingering angst over inventory issues. Overall the sector had 4 stocks climbing and 29 stocks falling.

Biofuels suffered a significant 12.5% decline with all 16 stocks falling and 5 falling more than 20%. It looks like concerns about rising corn prices and reduced margins affected the ethanol producers. Gushon (GU) reported a Q4 loss and, despite management explaining the loss was due to a large non-cash charge, the stock declined 24.9%

In the Renewable Electricity sector our index advanced 0.9% with 10 stocks climbing and 9 retreating. Suzlon (SUZON.NS) is a big component of the index and was down 13.1% percent after reporting a turbine blade replacement program for 1,251 blades. This represents a market cap decline of more than USD 1 million per blade against management’s estimated cost of USD 24,000 per blade.

Fuel Cells had a down week with the index decreasing 6.3% on 1 stock advancing and 6 stocks declining. FuelCell Energy Inc. (FCEL) led the movement downward with its stock price falling 14.3% for the week. Most of the loss came after their earnings call on March 6.

What did I learn this week? Oil prices hit record highs and sustainable stocks fall sharply with the broader market. Given the relatively high beta of the Solar, Fuel Cell, and Biofuels indices, their stock performance seems to be weakly correlated to oil prices and much more strongly influenced by broad market trends. Renewable Electricity, with its lower beta, may offer some portfolio diversification benefit.

Mark is the founder of Camino Energy, a information provider specializing in globally traded sustainable energy stocks. He also is an investor in sustainable energy stocks. Mark doen’t hold a position in any of the specifically mentioned stocks.

The week in sustainable energy stocks….

By Mark Henwood

Neal says “keep going”. So let’s start with the big picture.

Stocks were down – S&P, EAFA, emerging markets. Commodities advanced. The broad based ETN tracking the DJ AIG commodity index (DJP) increased 3.1% for the week. This was the week of oil history. Our sustainable energy indices were mixed with one, our biggest, declining and three advancing.

The Solar index suffered another large decline dropping 5.2% bringing the YTD decline for the sector to –38.9%. Solarfun Power Holdings Co. Ltd (SOLF) -16% and JA Solar Holdings Co (JASO) -13.9% led the decline after an analyst downgrade prompted by declining margins and weaker demand. With 25 stocks declining versus 8 advances, these concerns must be widely held.

In Biofuels our index advanced 1.8% led by an impressive 52.7% increase, in US dollars, for Basil Ecodiesel (ECOD3.SA). Despite Basil Ecodiesel being the largest biodiesel producer in Brazil, none of our usual news sources reported any developments to explain the sharp increase. Aventine (AVR) continued downward off another 7.3% in the wake of its liquidity issues, despite S&P leaving Aventine’s rating unchanged.

In the Renewable Electricity sector our index advanced 1.8% with 12 stocks advancing and 7 declining. Our scan of the news showed a series of normal announcements typical of an industry with some traction. The index results this week, moving counter to broad markets, are not surprising given the index’s 100 day beta of only .3.

Fuel Cells had a strong week with the index increasing 7.8%. The increase was due in large part to the 44.6% gain for Ceramic Fuel Cells Ltd. (CFU.L) Ceramic reported it was constructing a manufacturing plant in Heinsberg, Germany and a substantial order for 50,000 2 kW micro CHP units from NUON. If these units are able operate reliability at a reasonable cost this could be an important breakthrough in a significant market targeted by a number of fuel cell companies.

What did I learn this week? Market developments reinforced the highly “leveraged” nature of solar stock prices. High growth expectations result in high volatility. I also realized I need better information sources for some of the lesser developed markets like Brazil. These are important investment centers and I’ll be looking for improved resources. We also saw investors are carefully looking for the key breakthrough. Ceramic is now center stage.

Mark is the founder of Camino Energy, a information provider specializing in globally traded sustainable energy stocks. He also is an investor in sustainable energy stocks.

The week in sustainable energy stocks….

Neal asked me if I would comment on the markets for sustainable energy stocks in the last week. It’s an area I follow closely so he hopes I will occasionally stumble across some nuggets.

Let me start by saying I believe there is potential for good returns in sustainable energy stocks over time. In the short term though, it was a tough week. Sustainable energy stocks in all four of Camino’s sectors declined. In contrast, broader indicators such as the S&P, EAFA, and emerging markets were all positive for the week.

The Solar index, comprised of 33 companies, suffered the largest decline with a 5.3% drop bringing the YTD decline for the sector to -35.5%. Suntech (NYSE:STP) was hardest hit with a 20.3% price decline after it reported earnings and revenue below expectations, driven in part by silicon supply issues. If other producers report similar problems I would expect to see further declines in the sector as prices adjust to lower growth expectations.

In Biofuels Aventine (NYSE:AVR) was off 17.4% after it reported Thursday it had liquidity issues stemming from its $211.5 million invested in auction-rate securities. This issue may delay plant development. I expect analysts are reviewing the balance sheets of other sustainable energy companies to see if they have “cash equivalents” that aren’t exactly equivalent to cash. If you don’t understand what you’re investing in don’t invest in it.

In the Renewable Electricity sector Solar Millenium (FRA:S2M) declined 10.1% . The company announced a rights issue on Feb 19 that may have triggered concerns about dilution. Overall 8 stocks advanced and 11 declined resulting in relatively modest decline of 1.1% in the index.

In Fuel Cells all of our companies reported price declines with Fuel Cell Energy (NASDAQ:FCEL) falling the most at -6.3%. The company presented at the PiperJaffray conference on February 20, 2008 and didn’t highlight any items of concern that I noted.

What did I learn this week? Apparently growth constraints are still a factor in the high growth solar sector. I also relearned that unexpected risks occur when broader markets are having problems. Are there more surprises from the credit markets waiting to be revealed in sustainable energy companies?

Mark is the founder of Camino Energy, a information provider specializing in globally traded sustainable energy stocks. He also is an investor in sustainable energy stocks.

The Micro Fuel Cell Promise

Earlier this year I did a Cleantech Blog article called Micro Fuel Cell Killer talking about the challenges that undermined the promise of micro fuel cells.

Well, now we are looking at the other side of the story. One of my friends, Peng Lim, who is the CEO of Mechanical Technology Inc. (Nasdaq:MKTY), parent company to leading micro fuel cell developer MTI Micro, graciously consented to an interview on what they have done and the general state of play. In other words, what is the current micro fuel cell promise.

Peng, can you give our audience a little of your background prior to MTI? What made you choose MTI? And can you share some of your expectations from that time, and how they have panned out?

Prior to joining MTI, I spent the last 20 years in the consumer handheld electronics market starting with notebook computers in the early 1990’s and then moving into wireless computing in the mid 1990’s. At the time I joined, both markets were very young. You didn’t see many people with portable computers, or the hot spots that wirelessly connect them to the internet. I was fortunate to be part of the growth experienced by both portable computing as well as wireless computing. Each one of those industries grew because of the intrinsic need for people to be mobile. Allowing people to work any time, any place is something that they want; hence, both industries took off.

From there, in the late 1990s, I moved into the PDA market where I lead the worldwide product development for Palm, and was responsible for the Palm devices, OS and Application Software. At that time, the challenge was to take mobility to the next level. We devised a product that had the capabilities of a computer, but that could fit in your pocket; there would be no need to worry about the device. When needed, it is there and when it is not, it is stored in your pocket. Again the concept took off. At Palm, we captured 65% of the worldwide PDA market share and 75% handheld OS market share.

I left Pam in 2001 to start my own company focusing on handheld multimedia and gaming. The company was sold in 2005.

The reason why I joined MTI is two fold: 1) the technology has the potential to exponentially increase the energy density over that of lithium-Ion batteries, and 2) because of mobility. Mobile devices are not truly mobile yet. There is one last wire that attaches them to a wall – a charging wire.

Micro fuel cells promise to cut the last wire and provide customers with real mobility where they can use their devices at anytime and anywhere without having to be tethered to the wall for charging.

Besides MTI, I am currently on the board of advisors for Inventec Appliances, a multibillion dollar manufacturing company based in Taiwan.

Can you talk a little about the Mobion chip and your recent advances in it? What does that mean in the context of getting a product to market?

In June, MTI Micro demonstrated its integrated fuel cell chip used as the heart of its fuel cell systems for consumer product applications. The Mobion chip is based on 100% methanol feed, passive, direct methanol fuel cell (DMFC) technology. Passive water management applied to DMFC technology is the catalyst for reducing size and simplifying fuel logistics. MTI Micro has reduced the size of the Mobion chip by over 40% to 9cc (small enough to fit in the palm of a hand), and has reduced the parts-count of the chip to one molded piece. The Mobion chip is capable of operating at 0 to 40 degrees Celsius and at any level of humidity. This is an industry standard requirement for many OEMs who want to use fuel cells with their products.

MTI Micro’s Mobion chip architecture significantly reduces the complexity of a fuel cell system’s internal construction, thereby reducing manufacturing costs, increasing performance and enabling further system miniaturization – factors that are critical for the successful launch of fuel cell products in the consumer market. We believe the Mobion chip is the first micro fuel cell technology designed with the performance and manufacturability necessary to make a significant impact on the consumer portable electronics markets.

If you had to pick your 3 top early adopter products for micro fuel cells, what would they be? And for each one, what are the power to weight, power to size, and lifetime targets you feel each will require.

We see a lot of opportunity for the early adoption of micro fuel cells, particularly in handheld consumer electronics. Applications including cellular phones PDAs, MP3 Players, digital cameras, game players are very attractive to us. As far as power, size and energy goes, it certainly would depend on every application and also on what requirements OEMs may have; at the same time, there may be some trade-offs between size and energy, etc..

If you had to tell a consumer customer what to expect from a microfuel cell product – what would you tell them?

Most importantly longer device run-time – a feature that customers deeply care for. MTI Micro’s Mobion technology will also allow users to be free from tethering their devices to an electrical outlet, eliminating the need for carrying multiple bulky chargers and converters.

Also, since refueling would be as simple as just replacing a cartridge, there is no down-time required for a recharge. “Hot-swappable” cartridges would instantaneously allow the user to continue to use their device.

Micro fuel cells are also considered a green technology. On the other hand, some rechargeable battery technologies such as NiCad are toxic to the environment.

What’s different about micro fuel cells now as opposed to 4 or 5 years ago that gives you confidence?

1) Technical improvements including size, energy density and power density have improved.
2) The worldwide energy source for the consumer portable electronic market continues to grow (approximately $12 billion this year and is expected to grow to over $20 billion in 2012).
3) The infrastructure and supply chain are starting to come together – especially around methanol solutions like our Mobion Technology.
4) Methanol has been approved by the International Civil Aviation Organization (ICAO) to be carried inside commercial planes.

The DOT announcement on carrying methanol and fuel cells on planes is obviously huge – exactly why has it been so long in coming, and what put it over the line?

Direct methanol fuel cells and fuel refills can be transported safely, provided appropriate precautions are taken in design and packaging. However, meticulous considerations are given to any new products for approval in commercial transport. Having been approved by ICAO and now waiting for implementation by the U.S. Department of Transportation is an important and necessary step towards the commercialization of Mobion.

What exactly are the terms of the Samsung collaboration, and how does it affect MTI Micro’s plans for commercializing a micro fuel cell product?

MTI Micro first entered into a relationship with Samsung Electronics, our Korean partner and a leading producer of mobile phones, in May of 2006. Under the terms of MTI Micro’s initial Alliance Agreement, our Mobion technology was chosen to power a series of prototypes designed for mobile cell phone and cell phone accessories. In a short period of time, we delivered two rounds of these prototypes to Samsung for evaluation, and each prototype demonstrated significant size reductions and performance improvements from the previous. The latest and most advanced prototype contains the Mobion chip. This agreement expired on its own terms on July 31st of this year. However, on October 25th, MTI Micro announced its continued collaboration with its Korean partner, extending until the end of 2009, or six months after MTI Micro’s first commercial product launch should our commercialization timeline become accelerated – whichever comes earlier.

With this alliance in place, we feel very confident about MTI Micro’s strong momentum and ability to bring Mobion MFC technology to a high-revenue category within the worldwide consumer device market. Under this non-exclusive collaboration, MTI Micro will continue to refine the Mobion baseline product design for mobile phone applications. Until the design freeze date projected for December of 2008, our Korean partner may request product specification changes, and may also purchase commercial DMFC samples from MTI Micro as soon as they are readily available. Throughout this time we will also continue to share development updates with our Korean partner, as well as loan them prototypes for evaluation. With a production decision anticipated at the start of the third quarter of 2009, MTI Micro will thus prepare for the manufacturing of the Mobion baseline product starting in the third quarter of 2008, through the second quarter of 2009. To assist with evaluating potential manufacturing partners, and more importantly – to work as part of MTI Micro’s business development team to establish business relationships with new OEMs and maintain anticipated day-to-day, on-going customer relationships in Asia – we have added Korea-based Daehong Technew Corporation as a new representative, which we announced in late October.

On the financial side, can you share when you expect to reach breakeven, and your cash vs. financial burn forecasts, and your feeling on when or if the company will need to raise more cash?

As of November 8, 2007 the company has $12.6 million in cash and cash equivalents. Our burn rate is approximately $0.9 million per month. We have a number of resources for funding including the positive cash flow from our MTI Instruments subsidiary, sale of Plug Power stock, government funding and the capital markets.

Thank you Peng, always a pleasure. I will keep my fingers crossed for you guys.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog, a Contributing Editor to Alt Energy Stocks, and a blogger for the CNET Cleantech Blog.

Bio-fuel Cells

by Richard T. Stuebi

Earlier this month, here in Ohio, the fuel cell developer Technology Management Inc. issued a press release that it had succesfully operated its 1 kw solid oxide fuel cell stack on vegetable oil from soybeans. As reported on the Internet, it is claimed that this is the first instance of a solid oxide fuel cell running on vegetable oil, and that this development could break open the market for fuel cells in the developing world.

This does seem to be an innovation of merit. I have no reason to doubt the assertion, but I’m curious if any of our readers know of other examples of biofuels in fuel cells.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Riding on Sunlight

By John Addison (9/20/07). Electric light rail is a popular way to whisk millions through cities with speed, ease, and minimal emissions. Per passenger mile, source-to-wheels emissions are far less than people trying to navigate busy cities in their cars. Even if there is a coal power plant supplying the electricity, the efficiency of moving masses with efficient electric drive systems results in very clean transportation.

Unfortunately, the initial capital expense of light rail prevents many worthy projects. MTA New York City is spending over $7.5 billion to extend its sub-way. Most light-rail costs over $10 million per mile.

Buses can move millions for a fraction of the cost of light-rail. Bus routes can be easily changed as cities grow, change in shape, and alter in transportation demands. Light-rail tracks are likely to be fixed for over forty years; bus routes may change annually. For most major cities, the ideal is intermodal solutions that include both bus and light-rail.

Now AC Transit in Oakland, California, is making bus travel as appealing as light-rail. Each day, over one thousand people ride on three hydrogen fuel cell buses in Oakland and in environmentally conscious Berkeley. By 2012, five thousand people daily will be riding on twelve such buses. The only emission is water vapor.

At the heart of these electric buses are Siemens electric-motors, similar to the larger motors which power electric light-rail. The motors are powered by electricity generated from 120kW fuel cells and from 95kW of batteries. The batteries are also used to capture braking and downhill energy. The batteries are recharged nightly, making these buses plug-in hybrid hydrogen fuel cell buses.

The hydrogen is made by onsite reformation of natural gas. Basically CH4 is combined with steam (H2O) to produce hydrogen. The electricity to power the reformation and the compression of the hydrogen gas is from solar power. The 150 kg/day of hydrogen is used by the three buses and up to eleven Hyundai vehicles for supervisors.

The net result is electric buses that can run hundreds of miles up 18 percent grades, and then be cleanly refueled in minutes. By 2010, the buses are likely to run 16 hours daily, up from the current eight. In five years, AC Transit is likely to buy at least seven hydrogen buses annually, staying ahead of California’s zero-emission bus mandate.

These are the most advanced buses used in the world with 40-foot Van Hool A330 bus chassis modified to accommodate UTC’s PureMotion™ 120 kW fuel cell power system and ISE’s hybrid-electric drive system. Hydrogen tanks on the roof give the bus a range of 300 to 350 miles, and batteries recharged during braking can provide an extra 95kW of power for acceleration and climbing steep grades.

HyRoad, this exciting model of public transportation, was made possible by more than $21 million of funding from the Bay Area Air Quality Management District, California Air Resources Board, California Energy Commission, California Transportation Commission, CalStart, Chevron Corporation, Department of Energy, and the Federal Transit Administration.

The National Renewable Energy Laboratory released a preliminary report on its evaluation of AC Transit’s fleet of fuel cell buses. The report includes eight months of performance data on three fuel cell buses in service, as well as data from a fleet of diesel control buses.

AC Transit; SunPower (SPWR); MMA Renewable Ventures; and PG&E (PCG) dedicated the AC Transit’s state-of-the-art 621-kilowatt solar electric system. The system, located on AC Transit facilities in Hayward and Oakland, is expected to generate approximately 767,000 kilowatt hours of power each year.

Over the 30-year life of the system, AC Transit expects to save $5 million in utility costs as a result of the clean, renewable solar power that the system will generate. It will offset the production of more than 14.5 million pounds of carbon dioxide emissions – equivalent to planting 2,000 acres of trees or removing 1,400 cars from California’s highways.

“AC Transit is committed to reducing emissions of greenhouse gases and improving the quality of life for the entire region in which we operate,” said AC Transit General Manager Rick Fernandez. “While installing a solar system to power our facilities makes a great deal of financial sense, it will also provide more than enough power to offset the 189,000 kilowatt hours per year required to operate AC Transit’s hydrogen production facility, and help lower the overall amount of energy we use from conventional sources.”

Instead of spending millions to install the solar system, AC Transit arranged to pay 13.5 cents per kilowatt hour to MMA Renewable Ventures, which finances and owns AC Transit’s solar power systems under a SunPower Access™ program. “AC Transit selected an innovative financing structure to effectively meet its financial goals and environmental objectives,” said Matt Cheney, CEO of MMA Renewable Ventures. “With its forward-thinking approach and commitment to clean energy, AC Transit is demonstrating that solar power is an affordable option for public agencies concerned with reducing carbon emissions.”

“AC Transit is an environmental leader that is doing its part to address our ongoing energy challenges,” said Howard Wenger, SunPower vice president. “By generating solar power, AC Transit is reducing demand from the utility grid, reducing operating costs, and improving air quality for its community. This energy solution saves money while helping the environment.”

A large portion of the installation cost of these solar systems was covered by a $1.9 million incentive from PG&E, under California’s Self Generation Incentive Program. Through this program, PG&E can provide almost $950 million in incentives over the next 10 years to help customers buy their own solar systems.

In the past twenty years, solar power has dropped 90% in price due to technology breakthroughs and production volume. Over the next twenty years, we will see the same improvement with hydrogen transportation. Already, the hydrogen used cost AC Transit no more per mile than diesel fuel used in similar buses.

As fuel cells reach lives beyond 10,000 hours, and as costs are significantly reduced, advanced transportation like AC Transit’s HyRoad will become available worldwide. When it does, we can thank AC Transit and its partners for leading the way.

John Addison publishes the Clean Fleet Report (www.cleanfleetreport.com). September 24 to 27 he will be researching future articles at Solar Power 2007. On October 25 he will be a featured speaker at the California Hydrogen Business Council. Permission is granted to reproduce this story.

Fuel Cell 2007 Conference Highlights

By John Addison (6/19/07). Several hundred engineers, researchers, and managers shared fuel cell technology, trends, and market success at the Fuel Cell 2007 Conference. In some areas, fuel cells generate millions in revenues from commercial deployment; in other areas, fuel cells are early in research and development. A number of commercial products involve hydrogen PEM fuel cells. Business is steady for molten carbonate and phosphoric acid fuel cells. There was optimism about solid oxide fuel cells using a variety of fuels including landfill methane, natural gas, diesel, JP-8, and biomass.

In 2006, Ballard (BLDP) shipped 147 PEM fuel cells to replace lead-acid batteries in fork lifts. In large distribution and manufacturing environments, every minute counts. Fuel cells are cost justified in improving the productivity of moving goods. Fuel cells are more heat and cold tolerant, providing competitive advantage in many distribution centers.

Plug Power (PLUG) is aggressively pursuing the fork lift business. Plug recently acquired General Hydrogen, an early leader in Class 1 and 2 forklifts. Plug also acquired Celex, a leader in Class 3 forklifts. Contrary to concerns of some investors, it appears that Plug’s acquisitions may help Ballard who supplies fuel cell stacks to the acquired companies. Plug Power’s business model appears to be migrating towards integrated products and services for specific markets and applications. Ballard is a leader, in supplying fuel cell stacks; a field of growing and intensifying competition.

Toyota is also active in the hydrogen PEM forklift business since its acquisition of Raymond, a long-time provider of forklifts and material handling systems. Hydrogenics (HYGS) continues to see traction in fork lifts. Fuel cell forklift solutions are hybrid, also involving batteries for regenerative braking. Presentations forecasted 5,000 fuel cell sales in 2009 for forklifts and 20,000 in 2010.

Thanks to the sponsorship of Intelligent Energy, I was at the conference presenting One Million Hydrogen Riders in California by 2020 – An Optimistic Scenario. Free Report.

Hydrogen fuel cells are making progress in cars and heavy-vehicles. Several auto makers will be adding more vehicles in demonstration fleets this year. Several have ranges of 250-miles and more. General Motors recently demonstrated a 300-mile range with its Sequel. GM is rumored to also start demonstrating vehicles running hydrogen in internal combustion machines (HICE). GM was to speak at the conference, but cancelled at the last minute. The reason, perhaps, was a GM reorganization.

General Motors thinks its hydrogen fuel cell is ready to move out of the research lab. GM is shifting responsibility for the work from its research labs to engineering groups that develop engines and vehicles for commercial production. 500 people are being reassigned.

The shift is a sign of GM’s increasing determination to have a fuel cell vehicle on the market by around 2011. “We’re transitioning from science and research to developing real propulsion systems,” Larry Burns, GM vice president for research and strategic planning, said in an interview.

Another area of hydrogen fuel cell success is providing remote stand-by power for the telecommunications industry. Batteries in temperature-sensitive areas have failed to often. The financial stakes are too high in telecommunications to continue depending on unreliable batteries. Telecoms such as Verizon and Sprint are buying from PlugPower and ReliOn. The Western States Alliance is buying from Altergy and Hydrogenics for stand-by back-up.

Big and hot fuel cells have a growing pipeline in the 250kW to multi-MW space. FuelCell Energy (FCEL) and Fuji offer molten carbonate energy solutions with by-product heat. Projects are using natural gas, propane, biogas, and anaerobic digester (AD) gas. POSCO, a Korean steel manufacturer, ordered a 7.5MW from FCEL to reduce their heavy use of 28 cents/kWh grid electricity. Linde will distribute FuelCell Energy for water treatment.

Long-term, molten carbonate growth may be threatened by solid-oxide fuel cells (SOFC). Keenly aware of this, FuelCell Energy finalized terms with the U.S. Department of Energy (DOE) for a $36.2 million Phase I award to develop a coal-based, multi-megawatt solid oxide fuel cell-based hybrid system.

Six industry teams have successfully completed tests of the first solid oxide fuel cell prototypes that can be manufactured at costs approaching those of conventional stationary power-generation technology. Part of the U.S. Department of Energy’s Solid State Energy Conversion Alliance (SECA) program, these results reflect progress towards commercially-viable solid oxide fuel cell (SOFC) systems.

The six industry teams, led by Acumentrics, Cummins Power Generation, Delphi Automotive Systems, FuelCell Energy, General Electric, and Siemens Power Generation, designed and manufactured SOFC electrical power generators in the 3-10 kilowatt range. The industry teams’ prototypes surpassed the Department of Energy (DOE) Phase I targets. The prototypes demonstrated:

  • Average efficiency of 38.5 percent and a high of 41 percent, exceeding the DOE target of 35 percent.
  • Average steady-stage power degradation of 2 percent per 1,000 hours, besting the DOE target of 4 percent per 1,000 hours.
  • System availabilities averaging 97 percent, topping the 90 percent DOE target across the board.
  • Projected system costs ranging from $724 to $775 per kilowatt, which eclipsed the DOE intermediate target for an annual production of 250 megawatts and positions the teams to meet the 2010 target of $400 per kilowatt target.

For home stationary power applications, it will require combined heat and power (CHP) to financially justify fuel cell installations. Adaptation is predicted in markets where utility-delivered costs are high for heat and electricity, such as in Japan and Korea. Ballard will be delivering a higher temperature PEM to address the CHP market.

In the long-run, conference attendees showed more enthusiasm for SOFCs which can use existing fuels, such as kerosene in Japan and natural gas in other markets. For example, Ceres Power (CWR.L) is developing low cost and robust fuel cells that will be combined into stacks capable of generating between 1kWe and 25kWe. EDF Energy Networks, the UK’s largest electricity distributor, will be offering Ceres for home CHP.

SOFC may be the fuel cell of choice for auxiliary power on trucks and military vehicles. Delphi Automotive Systems has SOFCs in development for on vehicle use of diesel and JP-8. Cost effective removal of sulfur is a major issue, especially for the DOD’s JP-8.

Surprisingly, there was little discussion of micro fuel cells. Major Japanese consumer electronic companies were at the conference, but no products were presented. Continued reduction in power demand plus advancements in batteries and ultracapacitors may obviate micro fuel cell adoption.

The Fuel Cell 2008 Conference is planned to be in Long Beach, California, in June 2008.

John Addison publishes the Clean Fleet Report which tracks clean transportation in California. His articles have appeared in print and electronic magazines with over one million readers: Yahoo Finance, The Auto Blog, The Auto Channel, EV World, Cleantech, Green Post, Seeking Alpha, Hydrogen Nation and others. Mr. Addison is a popular speaker, conducting over 1,000 workshops in Europe, Asia and the Americas.

Micro Fuel Cell Killer – What’s Next?

About 4 or 5 years ago micro fuel cells were quite a hot topic in cleantech. They were going to power our laptops, cell phones, PDAs, blackberries, hand held multimedia devices, etc.

The story ran like this:

The digital age and increasing customer demand for more power hungry features like bandwidth, multimedia, et al on mobile devices like laptops, PDAs and cellphones mean the increase in power requirements are outstripping the pace of technology of lithium ion battery – therefore the only solutions will be micro fuel cells. And since battery manufacturers are a plodding, unimaginative lot, silicon valley and smart scientists can build a company to leapfrog them.

We saw major players like Motorola, Toshiba, Intel, and others taking a look, and startups like Smart Fuel Cells, Medis and MTI Micro seeking to make their name on a fuel cell the size of a credit card (or thereabouts) .

Today, still no micro fuel cell powered devices are on the market, many of the larger players have gone quiet, and all the startups are talking up battery charger (not device power pack) products – especially for the military and first responders.

What happened? What killed the micro fuel cells? Can they come back? And is something similar lurking around the corner for solar, electric vehicles, biofuels, next generation batteries or one of today’s other darlings of the cleantech sector that we can learn from?

Well . . . let’s see:

The technology is actually hard – Micro fuel cell technology proved a harder nut to crack than everyone thought (at least at anywhere near the same cost point) – and the product development issues given the state of the technology proved to be a real challenge.

Rational expectations – Market reaction to the underlying drivers has been aggressive. We’ve got global warming and high energy prices making people like Sun, Dell, and others hell bent on designing power saving devices – which the consumer is now interested in buying as a premium product. Once the electronic product companies actually put their minds to reducing power usage – well, it turned out that you actually CAN optimize a device to save power, and still pack enough features in to sell product.

The incumbent technology – Despite high profile thermal issues, the incumbent lithium ion technology turned out not to be so bad, and has continued to keep pace (as far as us lowly consumers can tell) – Bottom line: I now carry 2 very small 4 hour battery packs for my laptop – I can last a transocean plane flight without needing to plug in.

Infrastructure, infrastructure, infrastructure – And yes, having to make infrastructure changes is very costly in anything energy-esque, whether its in fuel, entrenched distribution, or tooling. As usual, winning technologies in energy tend to be owned by businesses that find a way to work with existing infrastructure, not to try and replace it.

And in the end, the batteries (and the big battery makers) still rule the roost, for now.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog, a Contributing Author for Inside Greentech, and a Contributing Editor to Alt Energy Stocks.

Plugging Along

by Richard T. Stuebi

It has long been axiomatic that fuel cells are years away from being commercially available: a technology that is not yet a product. For a brief shining moment in 2000, fuel cells were almost as hot as dot-coms, and several fuel cell companies went public and soared to extraordinary heights, before the market came to the realization that revenues — much less profitability — were many years away. The crash was not pretty, as it never is.

Perhaps no company experienced this boom/bust roller-coaster as vividly as Plug Power (NASDAQ: PLUG). PLUG was touting a vision of a fuel cell system in every basement of every building, generating emission-free power on-site for sale back into the grid. Not long after its IPO in late 1999, PLUG stock rose from about $20 to the $150 range, with a market cap of untold billions.

Then, someone came to realize that mass-distribution of hydrogen to fuel PLUG’s PEM fuel cells would be an issue. And, the required price point for PLUG’s system to be economic relative to grid power was very challenging. As with the dot-coms, retail investors discovered that a business model that would generate prompt/growing profitability — always the basis for stock valuations — was not going to be easy for PLUG, and began unloading the stock.

Since the peak, PLUG promptly fell below its IPO price by late 2001 (helped, no doubt, by the combination of 9/11, Enron, etc.), and has trickled down into the low single digits — currently roughly $3. Those who shorted the stock must have done well.

It’s easy to think that PLUG has been circling the drain. The Motley Fool continues to highlight PLUG (and other fuel cell companies) as bad investments. However, I was present last month at the Ohio Fuel Cell Coalition‘s annual symposium in Columbus, and was intrigued to learn that PLUG appears to be on the move.

In the past two months, PLUG has acquired not one but two companies, General Hydrogen and Cellex, both of whom are located in Vancouver BC, and both of whom were developing competing fuel cell applications to serve the industrial handling (read: fork-lift) markets.

True, fork-lifts may not be as big a deal as the potential offered by home power systems. But, no-one can deny it’s a real market with customers needing better solutions than can be offered by rechargeable batteries (propane in indoor environments is being phased out, due to indoor air quality and safety concerns). As is well-known, batteries are not an ideal solution for fork-lifts: the fork-lift loses performance as the battery discharges, battery recharge takes hours, and battery change-out is bulky and time-consuming. In contrast, the fuel cell pack can be quickly refilled with hydrogen in a few minutes, and the fork-lift is able to maintain its full performance until the fuel cell needs to be refilled. Hydrogen storage and refilling infrastructure on a site with many fork-lifts is relatively simple and cost-effective to implement.

With the new acquisitions, PLUG now is in a dominant position to serve a near-term market in which fuel cells can create demonstrable value for customers.

According to the presentation I heard at the symposium, initial trial runs of the Cellex technology at a Wal-Mart distribution center have been very promising, and could lead to an expansion of the testing program in short order. If a high-profile and enormous client like Wal-Mart were to want to roll-out fuel cell technology at all of its locations, it would be an affirming accomplishment for the fuel cell industry, and could perhaps begin to repair the sector’s battered reputation.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Honda’s FCX: Out-Priusing the Prius

by Richard T. Stuebi

While the Toyota Prius is the current “must-have” of the “green” community, Honda (NYSE: HMC) is aiming to trump Toyota (NYSE: TM) in the eco-friendly car derby.

Recently, Honda announced that it will commercially-unveil a fuel cell vehicle aimed for U.S. drivers, the FCX — not 10 years from now, not 5 years from now, not in 2010, but in 2008. Yes, that’s right: next year, a fuel cell car will be offered by a major auto manufacturer in the U.S.

Last Friday, the USA Today wrote an enthusiastic review after test-driving a prototype FCX. They raved about pretty much everything — from acceleration, to quietness, to interior size, to its styling, to carbon-neutral seat fabrics. It did seem like a pretty nifty car — even more Prius-like than the Prius itself.

Only in passing did the story mention the big bugaboo: where will drivers get the hydrogen to operate the car? Clearly, the main initial market for the FCX will be in California, where a significant effort called the Hydrogen Highway Network is underway to build hydrogen fueling stations across the state.

I’m encouraged by Honda’s decision to introduce a fuel cell car in the U.S. market. I have to admit that I’ve been somewhat pessimistic about fuel cell vehicles for a variety of reasons — not only hydrogen availability on the road, but also hydrogen production economics and environmental issues, fuel cell economics and reliability, and customer acceptance of a new fuel and prime mover for their cars.

Honda acknowledges that the FCX is not going to be accepted or acceptable to the mass-market upon release: production will not be in the millions, and no doubt the self-selecting trial customers will experience some hassles and nuisances that most customers wouldn’t be willing to endure. However, the commitment of Honda to such a public test fleet indicates that they are true believers in the long-term potential for fuel cell vehicles.

If Honda leads the way in tackling the vehicular challenges for fuel cells, and California sets the example on how to roll out hydrogen infrastructure, then it remains for some major player to solve the remaining obstacle to the hydrogen economy: production of hydrogen from renewable energy sources (i.e., carbon-free and limitless fuel) at economically reasonable terms. Who’s it gonna be?

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Blogroll Review: Beers, Cars, & Responsibility

Less Filling?
Back in the 80’s, there was a great movie called “Back to the Future.” It was about a car that could time travel. There was also something about a boy and scientist trying to change the past …but they not succeed in preventing the Kennedy Assassination! At the end of the film, we realize the car is really from the future. It runs on beer and the future has just arrived.

On this week’s Energy Blog: “Australian beer maker Foster’s is going to generate clean energy and clean water from brewery waste water by using a fuel cell in which bacteria consume the sugar, starch and alcohol in the waste. The fuel cell is expected to produce 2 kilowatts of power — enough to power a household — and the technology would eventually be applied in other breweries and wineries owned by Foster’s. The cell should be operating at the brewery by September.”

All I ever wanted was a car that could talk. :)

Go Go Google
Speaking of cars, would anyone drive a car built by Microsoft? Perhaps the software giant has a secret Xbox racer somewhere but it looks like Google is betting on the plug-in.

On this week’s Venture Beat, Matt Marshall writes about Google’s grant to Calcars:

“Google’s for-profit foundation Google.org has given a $200,000 grant to CalCars.org, a group that advocates the adoption of plug-in hybrid electric cars.”

There’s always Ctrl-Alt-Del before you cra…..

Applicious
This next story has nothing to do with cars or beer or cars that drink beer but about responsibility. Some environmental groups have pointed out that Apple is not socially responsible when it comes to the environment. Apple responded.

So does the company get a pass? Greenpeace says sort of:

“It’s not everything we asked for. Apple has declared a phase out of the worst chemicals in its product range, Brominated Fire Retardants (BFRs) and Polyvinyl Chloride (PVC) by 2008. That beats Dell and other computer manufactures’ pledge to phase them out by 2009. Way to go Steve!

But while customers in the US will be able to return their Apple products for recycling knowing that their gear won’t end up in the e-waste mountains of Asia and India, Apple isn’t making that promise to anyone but customers in the USA.”

What about a computer that drinks beer?

Frank Ling is a postdoctoral fellow at the Renewable and Appropriate Energy Laboratory (RAEL) at UC Berkeley. He is also a producer of the Berkeley Groks Science Show.