Fuel cells poised to strut into power market

by Kathleen Davis
Associate Editor

When Sir William Grove stumbled across the technology for fuel cells in 1839, he probably never dreamed it would take over a century before his discovery really began to make waves. (See sidebar.) Almost 200 years after Grove’s discovery, fuel cells are the technology everyone’s talking about.

Adoring their potential for energy efficiency (Argonne National Laboratory runs numbers showing a fuel economy past double and close to triple that of an internal combustion engine), General Motors, Ford and other car manufacturers have been excited about portable fuel cells for a number of years now, but crossing over into the area of stationary power sources has long been a hurdle for fuel-cell proponents.

It looks like that hurdle may be reduced to the size of a speed bump before too long, and the current wave of power struggles due to deregulation in states like California have made the idea of fuel efficiency and power independence all the more tempting as of late. According to a study conducted by the Freedonia Group entitled “Fuel Cells to 2004,” the U.S. fuel cell market will quadruple in less than three years and reach the $7 billion mark in 2009.

FuelCell Energy Inc., a company which specializes in the development and commercialization of fuel cells for electric power generation, has already seen the fruits of the burgeoning fuel cell market: the company reported revenues of $5.3 million for the first quarter of 2001. Compared with the revenues of $3.6 million in the same quarter of 2000, they saw an increase of nearly 60 percent. The company sites a number of reasons for this increase, including three orders for sub-MW and MW-class power plants from King County, the Los Angeles Department of Water and Power and PPL Energy Plus.

FuelCell Energy also has three field trial power plants completed and are working on integrating them into customer sites, including a Mercedes-Benz facility in Alabama and a unit for a hospital in Germany.

“Our activity during the first quarter provides a solid foundation for us to accomplish our goals for 2001,” said Jerry D. Leitman, president and CEO of FuelCell Energy. “We believe FuelCell Energy can contribute to meeting the need for additional electrical generating capacity in the U.S.”

“We are eager to begin this year’s commercial field trials,” he added.

Unfortunately-no matter how dire America’s need for generation may be-fuel cells still have one speed bump to flatten before the market truly opens up: cost. Fuel cells are still too expensive. With a sticker ranging around $3,000 per kW on the power plant pricing scale, fuel cells remain relegated to a niche market, where the cost of electricity is high and natural gas cost is low. As of late, however, low natural gas prices are more of a good-old-days fantasy, dealing another blow to fuel cells.

According to a number of critics, fuel cell manufacturers will need to slice that price in half before they can really expect to penetrate the competitive power market.

But even the expensive side of fuel cells has led to the formation of new companies. Avista Corp.’s fuel cell affiliate Avista Labs has formed a new company dedicated to developing and commercializing a cheaper manufacturing process for the hydrogen needed in fuel cells. Avista Labs will tranfers its ongoing fuel processor development work to the new company, to be called H2fuel.

DuPont is getting into the membrane business, developing a company to supply proton exchange membranes for fuel cells. The company wishes to be “a strong presence in what it believes will be a $10 billion total market for fuel cells by the year 2010,” they said in a statement.

“Fuel cells are a natural fit for DuPont technology and capabilities,” said Richard J. Angiullo, vice president and general manager of DuPont Fluroproducts. “More than 50 percent of a PEM [proton exchange membrane] fuel cell stack can be made from DuPont materials.”

Honeywell is attempting to lower the cost of fuel cells by creating a hybrid of fuel cells and microturbines. The Department of Energy is already testing one type of the hybrid, with another test for a second version slated for later this year.

And Ballard Power Systems has unveiled a residential prototype 1 kW PEM fuel cell generator for the Japanese market. A natural gas-fuelled cogeneration unit is the product of collaboration involving Ballard and Tokyo Gas.


Meet the fathers of the fuel cell

Sir William Grove was born in Wales in 1811. A British physicist, lawyer and knighted justice of the high court, Grove was the first to mix hydrogen and oxygen in the presence of an electrolyte, birthing an electric current and water in 1839. However, the process did not produce enough electricity to be useful. In 1846, Grove produced a major literary work on energy, On the Correlation of Physical Forces.

The actual term “fuel cell” is attributed to Ludwig Mond and Charles Langer. They attempted to build a functional fuel cell in 1889 using air and industrial coal gas. However, some sources site William White Jacques as the source of the phrase “fuel cell.” Jacques hit upon using phosphoric acid in the electrolyte bath.

Engineer Francis T. Bacon picked up where Jacques, Mond and Langer left off in the early 1930s. He managed to make a cheaper version of the earlier fuel cells. His used an alkaline electrolyte and nickel electrodes. By 1959, Bacon had perfected his alkaline fuel cell, which was capable of 5 kW. It was the primary building block in the fuel cells later developed by NASA.

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