LH. I can't get into the figures with a stock like this. It's...

LH. I can't get into the figures with a stock like this. It's all way to conjectory. In 7 years it will be a different world. The price of power, gas etc. In 7 years the BlueGen could be $8,000 etc.

I totally understand where you're coming from though. It is just simply too hard to do cost/production/profit analysis with a stock like this. There are way too many variables. This type of stock gives speculation a new meaning. You could give all types of costings/production scenarios - til the cows come home.

I am more interested in the future of the fuel cell industry, and how CFCL is situated. The future for fuel cells looks bright, and so does CFCL's.

Re the costing of the units, an interesting article from FuelCellEurope Director 'Towards a Fuel Cell Future' -

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"Fuel cells are the most efficient energy conversion devices because they directly transform their fuel into electricity, heat and oxygen, so there is no combustion stage, unlike other power sources. However, there are significant obstacles preventing a widespread commercial uptake. "New technology is always expensive at the beginning," suggests Brenninkmeijer. "Prices will, however, come down with economies of scale. There will be a need to subsidise this kind of new technology in a free market environment."

Europe must ensure that it is an early supporter and adopter of the technology. "Fuel cells and hydrogen are part of the future," says Brenninkmeijer, "and the question today is: 'how fast can we realise the widespread use of this technology and therefore start seeing the benefits of it in our societies?' If Europe does not participate in the development from a technological point of view, it will simply give more space to other global players to take advantage of the European market for their own financial benefits."

The significance of fuel cells and hydrogen has been acknowledged by the European Union, who have incorporated it in the Strategic Energy Technology Plan (SET). "It is a technology of strategic importance at EU level," Brenninkmeijer explains, "and the development of
the technology is on track with expectations. Currently, large demonstrator projects in transport and stationary applications are successfully showing the feasibility and the first commercial successes are demonstrating customer acceptance of portable applications."
He adds: "The need to move to cleaner, more efficient and sustainable energy solutions quickly in order to meet the 2020 and 2050 emissions targets will give this process more drive than one would normally see in new technology developments."

Brenninkmeijer is keen to stress that the path towards a fuel cell future is on track, despite what commentators may be saying about the industry promising but never delivering. "If you look at the development phase of new technologies," he says, "fuel cells and hydrogen are pretty much on track for what you can expect for the developments of new technologies."

Brenninkmeijer highlights mobile phones and laptops as technologies that had an obvious point of entry into the market, unlike fuel cells. "These technologies came into a market where they were not really replacing anything else that was there beforehand," he says. "The mobile phone replaced the telephone box on the street, but today it has very different functions on it. They went into clean markets, if you like. But for fuel cell technology we don't come into a clean market, it is a market that is totally established, standardised and running very cheaply if you consider the actual fuel costs.

"It's an incredibly established market, so in order to actually break into it, the technology will need a lot of additional support, because by market forces alone it's just not going to happen ? there's too many incumbents, interests and large corporations that need to file quarterly results."

To kick-start the commercial uptake therefore, significant public funding will be required, as industry by itself does not have the financial means to overcome the market's entry barriers ? standardised and cheap existing technologies, achieving economies of scale in a saturated market, a lack
of vision and understanding combined with a reduced appetite for risk, and the need for large companies to yield healthy quarterly reports.
Brenninkmeijer muses: "The only way really to overcome these hurdles and significantly develop this sustainable energy solution is to do it with quite substantial subsidies in the coming years. It's not going to happen by market force alone.

"If investors and users and all stakeholders who are around these technologies understand that," he concludes, "then that will be a big step forward." The SET plan of the European Commission is calling for ?5bn in public private funding for this technology for the 2013-2020 timeframe.

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http://www.publicservice.co.uk/feature_story.asp?id=15756