Power Engineering - Fuel cells big in Japan

5 May 2006 - In response to favourable legislation FuelCell Energy has extended the distribution agreement with its Asian partner, Marubeni Corp. to sell Direct Fuel Cell (DFC) products in Japan.

Terms of the revised agreement include a commitment by Marubeni to order 6 MW of DFC power plants and a cash down payment related to the commitment. In exchange, FuelCell Energy agreed to extend Marubeni's exclusivity to sell DFC products in Japan.

"Marubeni's commitment clearly demonstrates that the market drivers for our high efficiency and ultra-clean DFC products in the Asian market are strengthening," said R. Daniel Brdar, President and CEO of FuelCell Energy, Inc. "Commercial and industrial companies in Asia are demanding high efficiency and reliable onsite power generation such as our ultra-clean power plants to help them reduce their power costs while complying with the mandates of the Kyoto Protocol."

Initially, FuelCell Energy will add several local personnel for sales and servicing, supporting Marubeni's recently increased sales staff of its Fuel Cell Japan subsidiary formed last year.

In addition, the two companies will continue their efforts towards the formation of a joint venture for the packaging of DFC power plants in Japan. Moving more of the assembly of DFC power plants to Japan and incorporating balance of plant components from local vendors is expected to reduce product cost to be more competitive.

DFC products address two significant energy issues in Japan: coping with high-energy costs and meeting the country's commitments to reduce emissions.

The country's electricity prices are among the highest in the world. As of 2002, emissions of carbon dioxide per unit of Gross Domestic Product in Japan were the lowest among the world's mature market economies, and it is projecting an additional 1.4 per cent reduction by 2025. To achieve this, and to support the country's drive towards achieving its Kyoto Protocol commitments, Japan enacted a national Renewable Portfolio Standards program in 2003, targeting 3500 MW of power generation from renewable fuels by 2010.

In fiscal year 2005 alone, Japan allocated over $500m to promote the adoption of high efficiency new energy technologies at customer sites throughout the country. In addition Japan recently established the Biomass Nippon program, which allocated $282m in fiscal year 2005 to fund research and commercial adoption of energy generation by renewable fuels such as digester gas from wastewater treatment plants. Biogas is expected to be a sustainable growth market for distributed power generation, including DFC products.

Add RSS Feed