AFC Energy PLC (LON:AFC) said it has now concluded the majority of the engineering design to bring to market its first commercial fuel cell system.
The alkaline fuel cell power company said its system will have a low cost per kWh (kilowatt hour) compared to alternative generating systems, partially as a result of its ability to use lower quality and less expensive hydrogen sources.
READ: AFC Energy picks up first fuel cell order from Australian partner
In a commercial update, the company said it has been working with a leading clean-tech specialist consultancy to build on existing commercial activities and establish alternative distribution channels to accelerate future growth.
Strong emphasis is being placed by the company on the preparation for commercial deployment and the strengthening of its supply chain in response to the Southern Oil order in Australia and growing interest for fuel cell systems from potential customers in Japan and other potential customers in the Asia-Pacific region, AFC said.
AFC Energy said it has established further improvements in electrode longevity and cost reduction through its joint development activities with Industrie De Nora and is in the final stages of confirming an electrode pairing for the Southern Oil project in Australia. These electrodes are expected to be supplied by Industrie De Nora to AFC Energy in the first quarter of next year, subject to agreement on the terms of a Strategic Electrode Supply Agreement.
AFC added it expects to finalise its appointment of a mass-produced flow plate manufacturer by the end of 2018, following an international competitive tender. The process is expected to result in further cost reductions on a "per part" basis relative to earlier cost modelling conducted by the company.
The design of AFC Energy's new flow plate has all fuel cell components integrated within a single sub-assembly, which is expected to deliver not only material improvements in system performance but also a more streamlined and robust quality control function to help eliminate potential failure modes.
The company has commenced discussions with a leading international engineering and fabrication company whose focus is on optimised low-cost containerisation solutions. This company is currently working with AFC Energy on the design for a 40ft containerised fuel cell system that could deliver between 150 kW and 200 kW of power under a "plug and play" design system.
Rapid deployment
“This is an exciting development for AFC Energy as it should result in a productised fuel cell system capable of rapid deployment to any number of locations internationally, as is the case for carbon-emitting diesel generation,” AFC told investors.
Completion of these key activities will move AFC Energy closer towards achieving its commercial deployment goals.
Meanwhile, over the past twelve months, AFC Energy has been developing a high-power density alkaline fuel cell that is a variant of the company's existing technology platform. This version of the alkaline fuel cell is highly complementary to the existing alkaline system but materially opens the market for deployment in new off-grid, or space and weight constrained environments, AFC said.
The company also gave an update on progress at Dunsfold Park, the site in Surrey where the company is looking to host a hydrogen fuel cell micro-grid.
AFC Energy has been actively working with the management of Dunsfold Park and the owner of the neighbouring anaerobic digestion plant for the supply of fuel cell systems to the Park's development site.
A review of commercial opportunities over the past 12 months at Dunsfold has identified an opportunity for the company's fuel cells to be used in place of diesel generation during the construction phase of the Dunsfold Park redevelopment. While delays have occurred in the final permitting and consenting of the development site, the company is now working with the site's management to progress this project through to its next phase.
The potential for AFC Energy to develop a commercial fuel cell alternative to diesel generation could open up a major market for the company in off-grid and temporary power applications, AFC said.
"It's been a busy but successful twelve months both in terms of AFC Energy's preparedness for commercial deployment and in its drive towards clear platforms for deployment in the massive off-grid power market,” said Adam Bond, AFC Energy's chief executive officer.
“Our aspiration to become a leading supplier of hydrogen-based solutions across the value chain is now within sight and we look forward to consolidating and growing our existing pipeline of projects both in the UK, Australia and internationally," he added.
Shares in AFC were up 14.3% at 6.625p in early deals.