BUSINESS IS JUST A GAS SENSOR MAKER SEES FUTURE IN HYDROGEN.

Byline: Evan Pondel Staff Writer

It's odorless, tasteless, colorless and highly combustible. Invisible to the naked eye when it burns, it is the lightest gas known to exist on Earth.

As the first element listed on the periodic table, hydrogen's composition has scientists and businesses scrambling to capitalize on its practicality.

DCH Technology is utilizing hydrogen's properties to create products that detect the clandestine gas in different environments, and generating enormous revenues even as the tech sector slips further into bear territory.

The Valencia-based company on Monday posted a 77 percent increase in revenues of $961,551 for 2000, compared with $543,199 for the same period a year ago. At Wednesday's close, DCH was down a penny to $1.89 on the American Stock Exchange.

``They dominate in the sensors market and fuel cells,'' said Leonard Velis, vice president of investments for Torrey Pines Securities. ``They've had a rapid ascent.''

Founded seven years ago by David Haberman and David Walker, DCH's primary business is manufacturing sensors that use computer chips no bigger than a dime to sniff out hydrogen gas. The company also produces fuel cells, an energy source that provides electrical power from hydrogen gas.

Wearing a white jumpsuit, Peter Jardine, chief technologist of DCH, explained the transformation of an average computer chip to a hydrogen sensor.

The chips are first placed in an environment with air pressure 10 times the surface pressure of the moon. The chip is then showered with argon, which forms layers of metal that are specific for hydrogen detecting. Once the chip is removed from the pressurized environment, the layers of metal are essentially sculpted into a hydrogen-sensing chip.

Jardine said he can produce about 3,200 chips per day once the lab is completed in Valencia.

DCH has manufactured hydrogen sensors for the National Aeronautics and Space Administration, Boeing, General Motors, and Duracell, said Daniel Dunn, product manager for DCH.

The company was also contracted to provide hydrogen sensors for the Lenningrad Nuclear Power Plant in Russia.

While DCH plans to augment its hydrogen-sensing business, the company is also expanding its fuel cell operations.

``Now we're getting noticed for what we're doing with fuel cells,'' Haberman, DCH's chairman, said. ``In California, with the power problems, it's important that these technologies get a chance.''

Hydrogen burns a lot cleaner than conventional fuels, and though Germany is introducing hydrogen-powered vehicles, there are political and regulatory barriers to contend with in California, Haberman said.

``We are talking about a chemical people remember from high school chemistry because it is one of the most commonly used industrial chemicals. And now it's on the verge of becoming a clean fuel for people to use,'' Haberman said.''

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3 photos

Photo:

(1 -- color) These computer chips, used to sense hydrogen, were produced at DCH Technology in Valencia. The company is aiming at producing about 3,200 chips per day.

(2 -- color) Daniel Dunn, product manager of DCH, examines a unit containing a hydrogen-sensing chip at the Valencia lab.

(3) Chief Technologist Peter Jardine, clad in a white jumpsuit, gets ready to inspect one of the computer chips through a microscope in a clean room at the laboratory.

John McCoy/Staff Photographer