Fuel Cell Market Approaches, Difference between Japan and the US

In early February, Bloom Energy made quite a splash with the announcement of their fuel cell–based systems. There are several types of fuel cells, each using a different type of electrolyte. Knowing that fuel cells are very hot in Japan, I searched organizations working on the same type of fuel cell, solid oxide. This type uses ceramic electrolytes and runs at a temperature between 850 °C and 1,100 °C.

My search found the New Energy Foundation (NEF) working with New Energy and Industrial Technology Development Organization (NEDO). I met Mr. Makoto Okuda, the director of the Fuel Cell Department of the Research and Planning Center. NEDO has eleven projects under way, including development and validation of solid oxide fuel cell (SOFC) and polymer electrolyte fuel cell (PEFC) technology, and hydrogen technology and infrastructure development.

Mr. Makoto Okuda

The PEFC type is for small-scale systems, and the SOFC is for large systems. The PEFC is planned for automobiles and small power systems for residential use. Since I want to compare Bloom Energy with what’s happening in Japan, I will focus on SOFC in this blog.

NEF classifies SOFC in these four categories:

  • Residential—between 1 kilowatt and several kilowatts
  • Commercial—between several kilowatts and several hundreds of kilowatts
  • Industrial—between several hundreds of kilowatts and several megawatts
  • Large installation—several megawatts and more

Small-scale SOFC will accomplish $10,000 per kilowatt in 2012 or so; a comparable solution is about $700,000 per kilowatt. A good-size data center would require an industrial-size fuel cell, which should be available around 2012.

Right now, NEF is conducting validation of the residential version of the SOFC technology. Participants include large gas companies like Osaka Gas and Tokyo Gas, electric power companies like Tokyo Electric Power Co., Nippon Oil Corp., and TOTO. Except for Nippon Oil, which uses LPG and kerosene, the fuel is natural gas. Fuel cell system vendors include Kyocera and TOTO.

I discussed the following with Mr. Okuda:

  • Amount of investment
  • Speed to market
  • Elaborate validation
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Energy Impact of Increased Server Inlet Temperature
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The Japanese government is investing $12M in SOFC technology; in contrast, Silicon Valley–based Bloom Energy has raised $400M in funding so far. Also, the speed-to-market is significantly different. Bloom Energy, in competition with many others, needs to reach the market at utmost speed, while in Japan several companies need to work together under the guidance of the government.

Finally, the Japanese effort spends lots of time on validation. The SOFC technology runs its system under high temperature (700–1,000 °C), and it is necessary to make sure the system does not break after operating at high temperature for a long time. Mr. Okuda did not question the quality of Bloom’s fuel cell, but he was interested in reviewing the results.

Finally, I may be able to visit Bloom Energy soon and will ask for such data.

Zen Kishimoto

About Zen Kishimoto

Seasoned research and technology executive with various functional expertise, including roles in analyst, writer, CTO, VP Engineering, general management, sales, and marketing in diverse high-tech and cleantech industry segments, including software, mobile embedded systems, Web technologies, and networking. Current focus and expertise are in the area of the IT application to energy, such as smart grid, green IT, building/data center energy efficiency, and cloud computing.

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