| Have Fuel Cells Finally Turned the Corner? Location: New York Author: Darren O'Dowd Date: Thursday, March 11, 2010 Sunnyvale, California-based Bloom Energy, founded in 2001, was one of the feature stories on the February 21 edition of CBS Television's "60 Minutes." The subject of the story was the public unveiling of the Energy Server™, which is refrigerator-sized generating units containing solid oxide fuel cells. Bloom Energy claims that this type of advanced fuel cell holds greater potential for real distributed generation applications than its predecessors due to its use of lower cost ceramic materials as well as due to a breakthrough in engineering design challenges that previously hindered the development of solid oxide fuel cells. The Energy Server™, according to the Bloom Energy web site, is "fuel flexible," able to run on Natural Gas, or on renewable bio-fuels. Each one has a generation capacity of 100 kilowatts (kW), and the servers can be deployed modularly to provide greater generation capacity if needed (a Bloom Energy press release from February 24 details modular deployments of 400 kW and two deployments of 500 kW). One of the most unique and remarkable elements of this public "debut" is that it is nothing of the sort from a production and operational standpoint. Bloom Energy, on its web site and in press releases, already counts such prominent companies as Bank of America, Coca-Cola, eBay, FedEx, Google, Staples, and Walmart as its customers with already installed and operating servers. Among the uses cited for the Energy Servers™ are replacements for on-site diesel generators (typically for back up or peak time period generation) and replacement of traditional grid-delivered power, including for the purpose of reducing these companies' respective greenhouse gas emissions/carbon footprints through the use of bio-gas as fuel. However, amid the hype and buzz generated from the "60 Minutes" story and subsequent public unveiling of the Energy Server™ on February 24th, many questions remain as to whether or not this new offering is the "game-changer" that, to date, in regard to fuel cells, has been more promise than delivery. The Energy Server™ was developed largely in secret since Bloom Energy's founding in 2001, with no substantive information on the product coming from the company until last month's public coming-out party. Bloom Energy's headquarters are a non-descript office building in Sunnyvale with no signage indicating their presence there. Furthermore, while most often such new technologies are tested in cooperation/collaboration with the utility industry, Bloom Energy chose not to do so with the Energy Server™ at least not that is publicly known. A representative from The Electric Power Research Institute (EPRI) declined specific comment to a blog posting for the Wall Street Journal, indicating that, "we haven't had access to it." Therefore it is unclear how the server will function if interconnected to the grid in a net-metering scenario (similar to what's happening now in many jurisdictions with smaller Solar PV distributed generation). It's also unclear how exactly the Energy Server™ would function in residential areas, as its capacity would dictate its deployment at the sub-station level. Finally, there are many questions as to the specific costs associated with obtaining and operating the Energy Server™. Bloom Power's web site mentions a 3-5 year payback model on owning the server, but the company has not publicly gone into any further detail on the costs of ownership. Any deployment at a "utility level" will likely attract the attention of and possibly require the approval of regulators, at which point the cost in comparison to other generation resources, renewable or otherwise, will come into play. Despite these (and probably others not explored here) open questions, Bloom Energy and the Energy Server™ merit our industry's interest and attention going forward. The fact that they have a deliverable product already being used in the market speaks volumes as to how far fuel cells have come from promise to reality.
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