Release Date: July 30, 2002

DANBURY, CT - The U.S. Department of Energy has approved plans to shift the site of the world's first fuel cell to be linked to a clean coal technology power plant – a move that will give the power industry an earlier-than-expected preview of a super-clean, high-efficiency, coal-fueled generating system.

The department said today that it has given the go-ahead to FuelCell Energy Inc., Danbury, Conn., to install a two-megawatt fuel cell power plant at the Wabash River Energy, Ltd., coal gasification-combined cycle power plant in West Terre Haute, Ind. Original plans called for the fuel cell to be installed at the Kentucky Pioneer Energy, Ltd., gasification power plant near Trapp, Kentucky.

Both sites are owned by Global Energy, Inc., Cincinnati, Ohio, and both projects are part of the Energy Department's Clean Coal Technology Demonstration Program. The Kentucky project, however, is still in the design and permitting phase, while the Wabash River Energy plant has been operating since 1995.

"Relocating the fuel cell to an operating clean coal plant will give us a two-year jump start on demonstrating a high-tech power system that virtually eliminates air pollutants and significantly reduces greenhouse gas emissions," Secretary of Energy Spencer Abraham said. "President Bush has highlighted both clean coal technologies and fuel cells in his Clear Skies and Climate Change Initiatives, and this gives us a way to bring both together in an early preview of a possible power plant of the future."

FuelCell Energy's Direct FuelCell® generates electricity with no combustion. Instead it uses an electrochemical reaction between fuel and oxygen from the air to produce electric power. Since no fuel is burned, there are none of the pollutants commonly associated with the combustion of fossil fuels. In fact, many States have classified fuel cells as the environmental equivalent of wind and solar energy.

Most fuel cells entering commercial markets today are designed to use natural gas or methane gas produced from municipal waste treatment plants. The fuel cell planned for the Wabash River plant will be the largest ever to be fueled by gas made from coal.

FuelCell Energy has been working with the Energy Department's National Energy Technology Laboratory since the 1970s to develop fuel cell systems for electric power generation.

The National Energy Technology Laboratory also oversees the Clean Coal Technology Program and, in 1991 added the Wabash River Project to the joint government-industry clean coal program.

Instead of burning coal like a conventional power plant, the Wabash River plant breaks coal apart into a gaseous mixture. More than 97 percent of the pollutant-forming sulfur impurities are cleaned from the gas before it is sent to a gas turbine to generate electric power. To boost power generating efficiencies, the turbine's hot exhaust is captured and used to make steam for a conventional steam turbine. With this type of gasification system, there are virtually no sulfur, nitrogen, or ash particle emissions.

The 260-megawatt Wabash River plant has been operating since November 1995 and is currently one of only two commercial-scale coal gasification power plants running in the United States. In 1999, the Energy Department added the Kentucky Pioneer Energy project to the Clean Coal Technology Program to demonstrate another configuration for gasification power plants. Currently construction of the Kentucky project is slated to begin in early 2004 with operations beginning in mid-2005 at the earliest.

FuelCell Energy expects to be ready to ship the fuel cell from its Torrington, Conn., fabrication plant to the Wabash River site in the second half of 2003. By the time it arrives at the site, the fuel cell will have been assembled and tested on natural gas at the Torrington facility. A one-year test program would begin soon after the fuel cell arrives and is connected to the coal gas system. After the test period, Global plans to leave the fuel cell in place and use its electrical output to operate the Wabash River plant. The will allow the plant to send more power to the grid.

Engineers plan to begin preparing the Wabash River plant to receive the fuel cell as soon as environmental approvals are received. Plant modifications primarily involve installing ducts and other equipment to divert a portion of the clean coal gas from the main power system to the fuel cell.

The project cost will be $32.3 million, half of which will be provided by the Energy Department.