Fuel Cell Manufacturing Takes Off

THE MAGAZINE DEVOTED TO NICKEL AND ITS APPLICATIONS November 2004 Volume 20, Number 1

CALIFORNIA AND JAPAN are the most prolific markets today for stationary, molten carbonate fuel cells. But the northeastern U.S. is emerging as an important market as well.

COST OF GENERATING electricity from carbonate fuel cells is higher than that of traditional means of generating electricity. However,  the environmental benefits are significant.

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‘Green’ incentives and high traditional energy costs spur the market for fuel cells. By Virginia Heffernan

Nickel Magazine, November 2004 --  Parts of the world with high electricity costs are welcoming fuel cells made of nickel and stainless steel as an alternative to traditional power generation.

Connecticut-based FuelCell Energy Inc., which delivered its first commercial unit of the nickel-bearing fuel cells at the beginning of 2003, has already installed 35 power plants in various countries, including Germany, Japan, Spain and the United States. And the market is broadening.

"Our targets are areas of the world where electricity is expensive and there is substantial incentive funding [for green power]," says Steven Eschbach, director of investor relations and communications for FuelCell Energy. "California and Japan are the most prolific markets today, but we think there are opportunities in the northeast (U.S.), where there are high electricity costs and high levels of pollution."

In the third quarter ended July 31 alone, FuelCell’s product sales reached US$3.6 million. The company expects to ship another four to six power plants to customers in Japan and the United States by the end of the fiscal year.

The company’s Direct FuelCells (DFC), so-called because they do not require external hydrogen generation but operate directly on available fuels such as natural gas, are high-temperature, high-efficiency molten carbonate fuel cells designed for applications where the generator is stationary.

The DFCs consist of a ceramic-based matrix layer sandwiched between an anode made of porous nickel strip and a cathode made of a nickel material alloyed with chromium or aluminum. A hydrocarbon, such as natural gas, is fed to the anode while air is fed to the cathode. In a process called "reforming," hydrogen is extracted from the fuel and reacts with the air inside the fuel cell to produce electricity, heat and water.

Nickel is used to make the anodes and cathodes because it is a good conductor of heat and electricity and is resistant to corrosion.

Although the cost of generating electricity from carbonate fuel cells is much higher (16 U.S. cents per kilowatt hour at current natural gas prices) than the average cost of electricity from traditional sources (about 10 U.S. cents per kilowatt hour), the environmental benefits are significant. FuelCell’s DFCs emit considerably less carbon dioxide than engine-based technologies because they are twice as efficient as conventional fossil fuel-fired plants.

Another advantage DFC technology has over its main fuel cell competitor, proton exchange membrane (PEM) technology, is that the heat generated by the unit can be captured and used as thermal energy. At a Sheraton hotel in New Jersey, for example, heat generated by the 250 kilowatt DFC power plant is used to heat the hotel’s water. At a Michelin plant in Germany, the heat is used to generate steam for tire vulcanization.

And the unit can run on any hydrocarbon fuel, not just natural gas. At the Kirin brewery in Japan, the power plant runs on brewery gas. At a Los Angeles wastewater treatment facility, DFCs successfully operated on biogas generated by the treatment process in field trials.

Currently, all of FuelCell’s current customers require government subsidies to cover the cost premium for the green electricity. But Eschbach says the company is working hard to lower the cost of its units. By the year 2007, the company aims to have reduced the cost of its units by 75%.

Virginia Heffernan is a Toronto-based freelance writer.

PHOTOS: FuelCell Energy Inc.

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