Fuel Cell Demonstration Project Shows Reliability Of Clean, Efficient, Low-Profile Power Source.

NORWALK, Conn.--(BUSINESS WIRE)--June 23, 1999--

A 250-kilowatt project in Danbury, Connecticut, is nearing completion of its first full quarter of operation, demonstrating the reliability of fuel cell power generation technology, which has attracted power industry planners because of its efficiency and low environmental impact.

The plant is located at the headquarters facility of Energy Research Corporation (AMEX:ERC), which manufactures fuel cell stacks and the independent power plants they are used in. ABB supplied the sophisticated 300 kW power conditioning system for the plant, to convert the DC current generated by fuel cells into AC current. ERC utilizes the energy from the fuel cell unit throughout its headquarters and routes the clean excess power to the local utility grid.

"It's right outside our window and it's a success, generating over 400,000 kW hours since start-up," said Jerry D. Leitman, president and chief executive officer of ERC. "The technology is great and it's dynamic, with leading electronics suppliers like ABB working alongside us to bring this technology to market rapidly."

Fuel cells are, essentially, electro-chemical engines, able to convert the chemical energy contained within a fuel to DC electricity. Their generation process is quiet, with no combustion reactions or moving parts. As a result, power generation is clean (with zero pollutant emissions) and highly efficient, and makes better usage of fossil fuels. In addition, because the fuel cell plants can be operated efficiently at small scale, they allow power to be provided from facilities that fit well into landscapes and neighborhoods.

Generation Capacity Needs Are Large

The growing energy needs of the United States and the world have driven interest in fuel cell technology. Beyond the currently installed capacity for power generation in the United States of 750 million kilowatts, there is a need for 363 million kilowatts of new capacity between now and 2020, according to the U.S. Department of Energy's recent report, "Energy Information Administration Energy Outlook 1999." Filling this capacity with new power represents a $17 billion dollar per year opportunity for the next 21 years in the United States alone, according to ERC planners.

Globally, demand for new capacity is projected to reach 1,275 gigawatts by 2015, according to industry sources in Asia, the Pacific Rim, the Middle East, Africa, Europe and Latin America. With such demands on the immediate horizon, fuel cell power plant builders, utilities, and independent producers all are looking at the potential of fuel cells and their `green' energy benefits.

Suppliers Build History, Enter Market

Although fuel cell power plants, built in the 200-250 kW range, are just beginning to find their way into special commercial market applications such as hospitals, industrial buildings, and other facilities that require dependable sources of power, manufacturers of the plants (and their suppliers) have been building and testing units, in the process gathering data that illustrate the dependability of the technology. ABB, for example, successfully provided its first converter, a 300 kW unit, to MC-Power's 1995 demo project in Berea, California. Simultaneously, the company supplied a 2.6 MVA unit to ERC's 1.8 MW prototype demonstration in Santa Clara, California, which ran for 4,000 hours.

ABB has been able to modify its standard power converter products to meet and exceed manufacturers' specifications, and is expanding its scope of supply to fuel cell manufacturers, offering controls, instruments, and other electrical components.

A New Landscape - Literally!

Fuel cells have the potential to change the map -- literally to reconfigure the landscape, as well as the ways commercial users and consumers source energy. "There simply will be more distributed power generation, with self-contained plants supplying small geographic areas," says Anders G. Troedson, director of the power electronics division of ABB Automation. "Those areas may include power plants supplying small neighborhoods, plants landscaped into the urban environment serving commercial buildings of all types, and multiple plants working alongside larger utilities to supply existing power grids. The energy can be very local, accessible and, through the use of distributed fuel cell power generation plants, we can provide more dependable electricity to the user/consumer," Troedson says.

It is this added benefit of providing dependable power that has created so much interest in the technology in Europe, emerging economies and Latin America, according to Troedson. Industries and users who must have a constant, dependable and even power source to run their processes can control their own destiny with a generation source that will operate independent of any reliance on an uneven grid. "The energy business is re-inventing itself," Troedson says.

History Yields True Cost Calculations

The speed with which fuel cell power plants are adopted for commercial and residential use has been limited not by the technology, but by economic concerns that will diminish as the successful operating history of the existing units grows, says Troedson. "As high efficiency, low maintenance and operating costs for fuel cell power are positively verified to the community in general, we will see a rapid growth in the installed base," he predicts. "The piece of the cost equation related to operation and maintenance is still uncharted territory for the industry. ERC's Danbury installation will be very helpful on this question," he said.

Through its drives and power products group in New Berlin, Wisconsin, ABB Automation supplies a complete line of energy-efficient electric drives, motors and engineered drive systems for commercial and industrial applications.

Energy Research Corporation, located in Danbury and Torrington, Connecticut, is an internationally recognized leader in the field of electrochemical technology for electric power generation. ERC is developing its Direct Fuel Cells through funding from and in cooperation with government, electric utility and major international industrial organizations.

ABB, with U.S. headquarters in Norwalk, Conn., serves customers in power generation, transmission, and distribution; automation; oil, gas, and petrochemicals; industrial products and contracting; and financial services. ABB had U.S. orders of approximately $6.1 billion in 1998 and employed about 20,000 at manufacturing and other facilities in 41 states http://www.abb.com/usa. Worldwide, ABB Group reported orders of $31 billion in 1998 and employed about 200,000 people in more than 100 countries http://www.abb.com/.