Release Date: August 8, 2001

PITTSBURGH, PA - Four new government-industry projects have been selected as the vanguards of a $500 million, 10-year effort to produce breakthrough fuel cells that will shatter current cost barriers and move the advanced, low-polluting technology into mainstream energy markets.

Future fuel cells could be mass- produced from flat, ceramic plates. This configuration is called a "planar" fuel cell.

Secretary of Energy Spencer Abraham today announced that the U.S. Department of Energy has selected proposals from Honeywell, Inc., Torrence, CA; Siemens Westinghouse Power Corp., Pittsburgh, PA; the team of Delphi Automotive Systems, Flint, MI, and Battelle, Columbus, OH; and the team of Cummins Power Generation, Minneapolis, MN, and McDermott Technology Inc., Alliance, OH, as the winners in a competition to begin developing ultra-low-cost fuel cells.

Fuel cells - which generate electricity more like a battery than a boiler - were cited recently by President Bush as one of the "cutting-edge technologies" that could help reduce emissions of greenhouse gases.

"This is a major drive to make fuel cells the technology of choice for a wide range of tomorrow's energy needs," said Secretary Abraham. "We know these advanced, clean power systems offer ways to strengthen the reliability of our electricity supply while reducing pollutants. The final hurdle is cost, and with the technology push we are announcing today, we intend to overcome that hurdle."

The Energy Department's goal is to cut the costs of fuel cells to as low as 1/10th the cost of currently marketed systems and to only 1/3rd the cost of the more advanced concepts now beginning to reach commercial readiness. At $400 per kilowatt or less, these future fuel cells could find widespread market acceptance well beyond the niche applications of today's systems.

Fuel cells are being installed commercially today, but high costs have largely limited their usefulness to customers that demand premium-quality, highly-reliable onsite power. Because fuel cells don't rely on combustion and operate much more efficiently than traditional power plants, they release 25 to 50 percent less heat-trapping carbon dioxide than today's natural gas or coal-fired power generators.

Most fuel cells are custom manufactured and assembled one at a time, a labor-intensive and expensive operation. Many use various types of liquid acids or molten salts inside the fuel cell to carry out the electrochemical reaction that generates electricity.

The Energy Department believes that developing an all-solid-state fuel cell "building block" that can be mass-manufactured is one of the best ways to dramatically lower costs much like advances in solid state technology have cut the costs of computers and other electronics.

The department has formed the Solid State Energy Conversion Alliance (SECA), made up of commercial developers, universities, national laboratories, and government agencies, to develop the all-solid-state concept. Two government laboratories - the National Energy Technology Laboratory in Morgantown (WV) and Pittsburgh (PA), and the Pacific Northwest National Laboratory in Richland, WA - are the driving forces behind SECA.

SECA-developed fuel cells could eventually be used to generate electric power at central power plants, substations, or the point where the power is consumed. Versions of SECA fuel cells could also be used for military and automotive applications.

Each project will be divided into three phases. In the first phase, lasting four years, the teams will aim toward an $800 per kilowatt cost goal; in the next two phases, each lasting three years, the teams hope to trim costs to $600 per kilowatt and $400 per kilowatt or less, respectively. At each stage, fuel-to-energy efficiencies will also be enhanced, ultimately reaching 60 to 70 percent or more than twice the efficiencies of most of today's fossil fuel power plants.

If all projects proceed as planned, the department will provide about $271 million over the next 10 years, with the project teams financing approximately $226 million. Exact cost-sharing and other terms will be negotiated over the next several weeks. Details of each projects follow (click on each name for the proposer's project abstract - browser will open new window):

• Honeywell, Torrence, CA, will design, develop and demonstrate a modular, 3- to 10-kilowatt solid oxide fuel cell system for a wide range of power-generation needs. The self-contained prototype will be able to operate on a variety of fuels and can be designed as a stand-alone power plant tailored for a specific market, or integrated into a larger system. The Energy Department will provide nearly $74 million for the 10-year project with Honeywell contributing $59 million.

• Siemens Westinghouse Power Corp., Pittsburgh, PA, plans to develop a 7- to 10-kilowatt solid oxide combined heat and power system for residential applications, and a 3-to 10-kilowatt auxiliary power unit for automotive applications. Working with Siemens are Fuel Cell Technologies, Blasch Precision Ceramics, Georgia Institute of Technology, Lennox Industries, the Trane Company, Dominion Resources, Ford Motor Company, Eaton Corporation and Newport News. The Energy Department will provide $47.8 million while Siemens Westinghouse and its team will provide $32.8 million.

• Delphi Automotive Systems, Flint, MI, and Battelle, Columbus, OH, will develop and test a solid oxide design that can be mass produced at a low cost for automotive and truck auxiliary power units, distributed power generation and military markets. Delphi and Battelle will demonstrate a 5-kilowatt system that operates on common fuels. The University of Utah will participate as a consultant. The Energy Department will provide $74.6 million while Delphi and its partners will contribute $60.9 million.

• Cummins Power Generation, Minneapolis, MN, and McDermott Technology, Inc., Alliance, OH, will pursue stationary and mobile markets by producing and testing a modular, 10-kilowatt system that is quiet, highly reliable, highly efficient, and emits virtually no pollutants. It will be designed to compete with and possibly replace current reciprocating engines of the same size. The project accelerates McDermott's existing solid oxide fuel cell program, and makes use of Cummins Power Generation's skill in integrating systems and penetrating a variety of small-size consumer and commercial markets. Key subcontractors are Ceramatec, Inc. and Advanced Refractory Technologies, Inc. The Energy Department will contribute $74.2 million while the Cummins/McDermott team will provide $91.5 million.