technology assessment (sample)

8/4/2019 Technology Assessment (Sample)

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CONFIDENTIAL & PROPRIETARY 1

Technology Assessment:

Brighter BioEnergy Partners, LLC

Alternative Electrical Power Generation Technologies

Report Date:

January 9, 2008

EquityNet, LLC

866.542.3638

www.equitynet.com
http://www.equitynet.com/http://www.equitynet.com/http://www.equitynet.com/


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TABLE OF CONTENTS

1.0 Introduction .................................................................................................................................... 1

1.1 Executive Summary ............................................................................................................ 11.2 Background ........................................................................................................................ 2

1.3 A Perspective on U.S. Electric Power Energy Generation (since 2006) ............................. 2

2.0 Study Objectives .............................................................................................................................. 5

3.0 A Perspective on Alternative Power Generation Technologies ....................................................... 6

3.1 Impact of Energy Price Volatility and Other Factors on Technology Deployment ............ 6

4.0 Specific Issues Addressed in this Study ............................................................................................ 8

5.0 Study and Analysis Methodology ..................................................................................................... 9

6.0 Identification of Fuel Cell Technologies ......................................................................................... 10

7.0 Overview of Fuel Cell Technologies ............................................................................................... 11

7.1 Molten Carbonate Fuel Cell ................................................................................................... 12

8.0 Identification of FuelCell Energys Direct FuelCells ...................................................................... 14

8.1 Benefits of Fuel Cell Technology ............................................................................................ 14

8.2 FuelCell Power Generating Capacity Options ....................................................................... 14

8.3 FuelCell Energy, Inc and Potential Alternative Sources / Business Sector Competitors ........ 15

8.4 Performance of FuelCell Energy, Inc. ..................................................................................... 16

9.0 Integration with Brighter BioEnergy Partners Waste-to-Energy Conversion Processes .............. 18

10.0 Molten Carbonate Fuel Cell Cost Trends ....................................................................................... 19

10.1 Basis for Power Generation Cost Comparisons ................................................................... 19

10.2 12-Year Trend in MCFC-Based Installed Capacity Cost ........................................................ 19

11.0 Conclusions and Recommendations .............................................................................................. 21

12.0 Appendix ........................................................................................................................................ 23

12.1 References and Identification of Source Materials .............................................................. 23

12.2 Exclusions, Contact Information, and Disclaimers ............................................................... 2412.3 Assumptions and Limiting Conditions .................................................................................. 24

12.4 Attachments ......................................................................................................................... 25


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1.0 INTRODUCTION

1.1 EXECUTIVE SUMMARY

From data available from the U.S. Department of Energy, coal-fired plants continue to be the primary source of

electric baseload generation in the U.S. However, coals share of total net generation decreased in 2006, even

though total net generation increased by 0.1 percent. Most of the new electric power plants placed into service in

the United States since 1999 have been natural gas-fired plants, which are generally cleaner and more efficient

than coal plants. Natural gas generation showed the highest rate of growth of the traditional energy sources from

2005 to 2006.

The study and analysis reported here were designed to provide essential independently (non-vendor)-derived

information to provide Brighter BioEnergy Partners, LLC a sound basis for selecting an electrical power generation

technology to be combined with their anticipated waste-to-power conversion system(s).

For its primary waste-to-power conversion technology, Brighter BioEnergy Partners expects to use a plasma arc

converter system, potentially in association with biodigesters being used for certain biogenic and agricultural

wastes. On-site use of the off-gases for electrical power generation, combined with low-level heat recovery, could

reduce operational and fiscal constraints on the proposed project.

Five primary factors led to the identification of high-temperature fuel cells as the alternative technology of

choice, including: fuel flexibility; minimizing environmental impact; efficiency; operational reliability; and the

presence of certain financial incentives to adopt this technology.

A number of states are seeking to secure cleaner energy sources and are legislating Renewable Portfolio Standards

(RPS) to mandate that utilities provide a certain amount of their electricity from renewable sources such as solar,

wind, and fuel cells. Currently, 22 states have RPS laws on their books, and in 5 states, ultra-clean fuel cellsoperating on natural gas qualify as renewable. State and Federal incentive programs for purchasing and operating

ultra-clean technologies contribute to making high-temperature fuel cells an attractive alternative to traditional

power generation systems.

Capital and operating costs for high-temperature fuel cells and associated low-level heat recovery units (LLHRU)

were examined in light of trends over at least the past 10 years, and quantitative projections of costs at the likely

time of deployment by Brighter BioEnergy Partners are presented.

Using 8 criteria considered for the identification and qualification of alternative electrical power generation

technologies, the use of high-temperature (molten carbonate) modular fuel cells is identified as presenting the

greatest opportunity. This type of fuel cell, as produced and placed into commercial service by FuelCell Energy, is

specifically identified. FuelCell Energy appears to be a sound company and a leader in fuel cell technologydevelopment and commercial deployment. Further, it has been and continues to be aggressively pursuing cost-

reduction efforts in fuel cell power plants.

Recommendations are provided for possible next phases of design studies and more detailed engineering and cost

analysis.

Electricity demand is far outpacing new supply sources..,

Source: Wall Street Journal, October 17, 2007, pp A17


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1.2 BACKGROUND

The primary waste-to-power conversion technology is expected to use plasma arc potentially in association with

bio-digesters being used for certain biogenic and agricultural wastes. Both systems produce off-gases with good

energy content but with stream composition variable depending on waste stream (feedstock) input and process

operating variables. Such off-gas streams may not be suitable for sale or direct injection into natural gas

transmission lines without substantial and expensive treatment and measure for quality control that could imposesub-optimal operating conditions on the primary waste-to-energy system components.

On-site use of the off-gases for electrical power generation, combined with low-level heat recovery, could reduce

these project constraints. With appropriate contractual arrangements in place, excess electrical energy produced

could be sold into the grid.

Exhibit 1.1 (above) shows the essential context for captive electrical power generation. A more complete, albeit

still high-level, schematic representation of the Brighter BioEnergy Partners system is shown in Exhibit 9.1 of this

report (Integration with Brighter BioEnergy Partners Waste to Energy Conversion Processes).

1.3 APERSPECTIVE ON U.S.ELECTRIC POWER ENERGY GENERATION DATA (2006 DATA)

Net generation of electric power increased 0.2 percent from 2005 to 2006, rising to 4,065 million megawatt hours

(MWh). According to the Bureau of Economic Analysis, the U.S. real gross domestic product increased 3.4 percentin 2006, and the Federal Reserves tally of total industrial production showed a 3.0 percent increase in 2006.

Notwithstanding these indicators of robust economic activity, which normally correspond to increases in demand

for electric power, milder temperatures than in the previous year contributed significantly to the relatively flat rate

of increase in electric power generation.

Exhibit 1.1. Electrical Power Generation Concept

Integrated

Waste-to-Energy

Conversion Systems

SolidsWater, Liquid Waste

Streams

(treatment & recycle)

Fuels(for backup & process

optimization)

Electricity

OUTFLOWS

Co-products

(minimized wastes

& discharges)

INFLOWS(waste streams &

fuels)

Gas

Systems Concept

(Flow Diagram)

Regional / Local Area

Industries, Municipalities,

& AgricultureWastes

Utilities

(electrical grid) Steam

Last Revised July 28, 2008 RRG

Power Generation;Waste Heat Recovery

(Fuel Cells)


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The three primary energy sources for generating electric power in the United States are coal, natural gas, and

nuclear energy. These three sources consistently provided between 84.6 and 88.6 percent of total net generation

during the period 1995 through 2006.

Petroleums share of total net generation peaked at 3.6 percent in 1998. It declined thereafter to a low of 1.6

percent in 2006. Conventional hydroelectric powers contribution declined from 9.3 percent in 1995 to 7.1 in

2006. Renewable energy sources, other than hydroelectric, contributed 2.4 percent of U.S. net electric generationin 2006. Since 1995, renewable generating capacity, on average, has accounted for 2.1 percent of net generation.

In that time, 2001 was the only year in which net generation by renewable resources was less than 2.0 percent of

total net generation (1.9 percent).

Electricity generation from coal in 2006 fell 1.1 percent from 2005 to 1,991 million MWh. In the past decade,

generation from coal declined only one other time (between 2000 and 2001). Coals share of total net generation

continued its slow decline over the past decade, from its peak of 52.8 percent in 1997 to 49.0 percent in 2006.

Coal-fired plants continued to be the primary source of baseload generation. However, its share of total net

generation decreased notwithstanding that total net generation increased by 0.1 percent. This was attributable to

continued growth in natural gas and nuclear generation, reflecting the cumulative effects of the growth in natural

gas-fired capacity and upgrades of nuclear power plants that emerged following 1997. It also reflects a reduction

in net summer coal-fired generating capacity, with 967 MW retired or de-rated, only partially offset by 542 MW of

new capacity.

Average annual growth in natural gas-fired electric power generation from 1995 to 2006 was 4.6 percent,

compared to 1.4 percent average annual growth for both coal and nuclear power generation. Most of the new

electric power plants placed in service in the United States since 1999 have been natural gas-fired, which are

generally cleaner and more efficient than coal plants. Natural gas generation showed the highest rate of growth

from 2005 to 2006 of the traditional energy sources, increasing 7.3 percent and reaching 813 million MWh. Part of

the growth in 2006 was attributable to the disruption of natural gas supplies in 2005 due to Hurricanes Katrina,

Rita, and Wilma, which all contributed to high natural gas prices nationally and to lower natural gas electric power

generation in Gulf Coast states. By 2006, more normal conditions had returned to the region, and natural gas

prices returned to a more competitive level.

Net generation at nuclear plants increased 0.7 percent in 2006 to 787 million MWh. Between 1995 and 2006,nuclear generation ranged from an 18.0-20.6 percent share of total net generation with an annual average growth

in net generation of 1.4 percent from 1995 through 2006, despite the fact that no new nuclear units had been

constructed. Continued growth in nuclear generation is due to the improved capacity utilization (the capacity

factors for nuclear plants have increased nearly 17.6 percentage points over the last decade) and to incremental

capacity upgrades to existing units. In 2006, upgrades produced 346 MW of incremental capacity and capacity

factors increased from 89.3 percent in 2005 to 89.6 percent in 2006. The increase in capacity, plus improved

capacity utilization, combined with the reduction in coal-fired generation contributed to the rise in nuclear

generations share of total net generation.

Net generation from conventional hydroelectric plants increased 7.0 percent over 2005, to 289 million MWh,

although the level was still lower than the peak year for hydroelectric production over the past decade (356 billion

kilowatt-hours in 1997). (The western U.S. experienced one of the most severe droughts in history from 1999

through 2004.)

Petroleum-fired generation fell 47.5 percent, to 64.4 million MWh and accounted for only 1.6 percent of total net

generation. Over the past decade, petroleum-fired electric power generation has declined at an average annual

rate of 1.3 percent. The large decrease in 2006 is directly attributable to sustained high petroleum prices following

the 50.1 percent price increase in 2005, as petroleum prices declined only 3.3 percent in 2006.


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Renewable energy, other than hydroelectric, grew 10.6 percent and accounted for 2.4 percent of net generation in

2006. The greatest growth in the renewable sector was in wind generation, which contributed 95 percent of the

growth in renewable energy. Wind generators produced 26.6 million MWh, 49.3 percent higher than in 2005.1

1Energy Information Administration, U.S.D.O.E., Energy Information Administration, Electric Power Annual with data for 2006,

(November, 2007).


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2.0 STUDY OBJECTIVES

This study and analysis were designed to provide independently, non-vendor-derived essential information as a

sound basis for selecting an optimal electrical power generation technology for integration into the waste-to-

energy conversion project being considered by Brighter BioEnergy Partners, LLC.

Among criteria considered during the identification and qualification of alternative electrical power generationtechnologies were that the alternatives must:

1. Be fully compatible with other technologies in the Brighter BioEnergy Partners Waste-to-Energy Project

2. Integrate with plasma arc and/or bio-digestion and utilize off-gases from those units with a minimum of

treatment and cost

3. Be responsive to environmental imperatives, particularly atmospheric emissions and water usage and/or

discharge

4. Provide efficient, preferably superior conversion of gaseous fuels to electrical power and allow integrated

low-level heat recovery

5. Anticipate a technological response to future costs associated with carbon emissions

6. Capture emerging technology and reduce risk of competitive obsolescence

7. Provide inherently safe and flexible operational capabilities8. Require no technological break-through, discovery, or invention for commercial deployment (i.e., have a

low inherent commercial risk).


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3.0 APERSPECTIVE ON ALTERNATIVE POWER GENERATION TECHNOLOGIES

Popular arguments for the consideration of alternative energy technologies abound, e.g.,

Highly centralized generation of electrical power is a paradigm that has outlived its usefulness.

Decentralized generation could save $5 trillion in capital investment, reduce power costs by 40 percent,

reduce vulnerabilities, and cut greenhouse gas emissions in half.

However, technology has improved and natural gas distribution now blankets the country. By 1970, mass-

produced engines and turbines cost less per unit of capacity than large plants, and the emissions have

been steadily reduced. These smaller engines and gas turbines are good neighbors and can be located

next to users in the middle of population centers. Furthermore, the previously wasted heat can be recycled

from these decentralized generation plants to displace boiler fuel and essentially cut the fuel for electric

generation in half, compared to remote or central generation of the same power.2

---------------------------

A primary motivation for undertaking this study and analysis was achieving a general awareness of the technical

advances and declining cost of fuel cell technologies and the multiple advances apparently available when that

technology is used in application environments similar to those in which Brighter BioEnergy Partners waste-to-

energy project is to be situated.

To provide a meaningful context for the study and analysis of fuel cell technologies, a limited comparison study of

other gas-fueled power generation technologies is necessary, including conventional co-generation approaches,

gas-fired turbines in combined cycle, and microturbine applications for distributed generation.

A key factor in the success of gas turbine electrical power generation has been the use of natural gas as a fuel.

Natural gas, composed mostly of methane and CH4, has been called the "prince of fuels" because it has the highest

heating value and is environmentally the most benign (that is, producing the lowest level of CO 2) among

hydrocarbon fuels. In the past, the relatively low long-term price of natural gas and its availability through

pipelines and from LNG plants and tankers helped drive the market for gas turbine power plants.

Very small gas turbines, called microturbines, continue to emerge in the market as a viable energy option fordistributed electrical power and cogeneration. These small gas turbinesranging from 30 to 400 kWare typically

fueled by natural gas. Microturbines are geared toward solving on-site energy demands, such as supplying

electrical power and heat for fast food restaurants. Several thousand of these units (priced from $850 to $1,500

per kilowatt) have been sold and installed in the last two years by Capstone, Elliott Energy Systems, and Bowman

Power Systems, among others. Some advocates of microturbines compare their future status in the electrical

power industry to that of the PC in a computer industry once dominated by mainframe systems. Time and the

marketplace will, of course, resolve these matters.

3.1 IMPACT OF ENERGY PRICE VOLATILITY AND OTHER FACTORS ON TECHNOLOGY DEPLOYMENT

Price volatility in the natural gas and electricity markets affects decisions regarding owning and operating emerging

energy technologiesspecifically, distributed generation (DG) equipment and combined heat and power (CHP)systems. Price volatility clearly impacts the perspectives and actions of end-use customer and energy services

companies as they relate to installation, ownership, and operation of DG/CHP systems and is a particularly

sensitive matter in Texas.

2Casten, Thomas R. and Brennan Downes, Critical Thinking About Energy: The Case for Decentralized Generation of Electricity,

Skeptical Inquirermagazine, January 2005;http://www.csicop.org/si/2005-01/energy.html
http://www.csicop.org/si/http://www.csicop.org/si/http://www.csicop.org/si/2005-01/http://www.csicop.org/si/2005-01/energy.htmlhttp://www.csicop.org/si/2005-01/energy.htmlhttp://www.csicop.org/si/2005-01/energy.htmlhttp://www.csicop.org/si/2005-01/energy.htmlhttp://www.csicop.org/si/2005-01/http://www.csicop.org/si/


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Distributed generation is the strategic placement of electric power generating units at or near customer facilities

to supply on-site energy needs. Combined heat and power (CHP) is the generation of electric or mechanical power

and thermal energy simultaneously from the same fuel source.

Distributed generation projects can be designed to produce electric or mechanical power only or to produce

electric or mechanical power and thermal energy (CHP). DG benefits as compared to power from the grid for

energy users may include enhanced reliability, superior power quality, independence from the grid, and lower

energy costs.

CHP offers individual and societal energy and environmental benefits over electric-only systems, in both central

power generation and distributed generation applications. CHP systems achieve increased efficiency in fuel use,

reduced emissions of air pollutants and greenhouse gases, and enhanced reliability of the electrical grid.

Industrial, institutional, and commercial facilities are the principal users of CHP, along with some utilities and

independent power producers.

End-use customers making DG/CHP investment decisions may implicitly or explicitly address energy price volatility

in the investment/planning context. Price volatility in this sense refers to long-term uncertainty about energy price

levels that influences investment planning. This uncertainty has a number of potential implications for investors.

For example, it might cause them to delay decisions to purchase appliances and equipment. Or, it might cause

them to invest in different types of equipment than they might otherwise, e.g., in a dual-fuel capable system

rather than a dedicated-fuel system. The ways in which potential DG/CHP investors could take price volatility intoaccount are varied, from demanding a higher rate of return on a project, to informal considerations of impacts, to

neglecting the issue entirely.

The five most common types of on-site generation technologies include:

reciprocating engines

small gas turbines

steam turbines

microturbines

fuel cells

(Except for fuel cells, these technologies are known as prime movers and convert fuel to shaft power or

mechanical energy.) In both DG and CHP applications, the mechanical energy from the prime mover drives a

generator for producing electricity. It may also drive rotating equipment, such as compressors, pumps, and fans.

In the case of CHP applications, a heat recovery system captures and converts the energy in the prime movers

exhaust into useful thermal energy. The thermal energy from the heat recovery system can be used either for

direct process applications or indirectly to produce steam, hot water, hot air for drying, or chilled water for process

cooling.3

3Henning, Natural Gas and Energy Price Volatility (2003),

http://files.harc.edu/Sites/GulfCoastCHP/Publications/NaturalGasEnergyPriceVolatility.pdf
http://files.harc.edu/Sites/GulfCoastCHP/Publications/NaturalGasEnergyPriceVolatility.pdfhttp://files.harc.edu/Sites/GulfCoastCHP/Publications/NaturalGasEnergyPriceVolatility.pdfhttp://files.harc.edu/Sites/GulfCoastCHP/Publications/NaturalGasEnergyPriceVolatility.pdf


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4.0 SPECIFIC ISSUES ADDRESSED IN THIS STUDY

In this study and analysis, consideration was given to the following points, ultimately resolving largely to the use of

high-temperature fuel cell technology in Brighter BioEnergy Partners waste-to-energy project:

Optimum project use of high to moderate fuel-value off-gases from both plasma arc converters for MSW

and bio-digester systems for biogenic and agri-wastes, both anticipating a range of feedstockcompositions (with resulting variability in off-gas composition)

Capital and operating costs projections for the project

Consideration of potential environmental benefits and / or negative impacts (on a comparative basis

against traditional electrical power generation technologies)

Operational flexibility and system expandability allowed by adoption of the technology

Providing a description of any potential constraints imposed on the project by adoption of the technology

identified during the course of the study.


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5.0 STUDY AND ANALYSIS METHODOLOGY

EquityNet used its well-established process for providing the study and analysis proposed here. This is a multi-step

process that included, but was not limited to, the following steps and procedures:

Background research and data collection

Projections of technology trends and costs (for high-temperature fuel cells and competitive technologies) Interim conferencing (telephonic) with client and subject matter experts for the target technology

analysis of integration issues

Report preparation by project managers and vetting by participating subject matter experts.

Capital and operating costs for high-temperature fuel cells and associated low-level heat recovery units (LLHRU)

were examined in light of trends over at least the past five years, and quantitative projections of costs at the likely

time of deployment by Brighter BioEnergy Partners were developed. Descriptive performance information for a

specific supplier of Molten Carbonate Fuel Cells (MCFCs), FuelCell Energy's Direct FuelCell (DFC), were collected

and organized for presentation herein.


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6.0 THE IDENTIFICATION OF FUEL CELL TECHNOLOGIES

Five primary factors led to the identification of fuel cells as the alternative technology of choice, including fuel

flexibility, minimizing environmental impact, efficiency, the presence of certain financial incentives to adopt this

technology, and operational reliability.

Fuel Flexibility: A number of industrial and municipal facilities and agricultural plants generate wasteswith high-energy values. These waste streams can be used in turn to generate hydrocarbon-rich off-

gases, synthesis gas, or biogas in subsequent waste-to-energy processes. Fuel cell power plants can

harness the hydrocarbon gases (largely methane) in these byproducts and then use the gas to power the

system in lieu of natural gas, making it a renewable energy source. In many places where off-gases and

digester gas production volumes and compositions are variable, fuel cell power plants are designed to

operate with automatic blending with natural gas. The electricity generated by a fuel cell power plant can

supplement or displace retail power consumed at adjacent facilities or sold to the grid.

Environmental Impact: With increasing energy demands and costs coupled with the growing public

awareness of the need for energy conservation, fuel cell power plants are increasingly being chosen for

on-site or distributedpower generation. Because of their very low emission of pollutants such as nitrogen

oxides (NOx) and sulfur oxides (SOx), as well as dramatically lower emissions of carbon dioxide (CO2), fuelcell power qualifies under several governmental and other environmental certifications, such as the

Leadership in Energy and Environmental Design (LEED) program and Renewable Energy Standards (RES).

MCFC-based power plants have also been designated as "Ultra-Clean" by the California Air Resources

Board (CARB) and exceed all 2007 CARB standards. Fuel cells also have the potential to substantially

reduce if not eliminate emissions generated by fossil-fuel-based backup generators that are often

required by facilities employing wind and solar power.

Efficiency: Fuel cell power plants are highly efficient in the use of hydrocarbon-rich gaseous fuels and

have an inherent Low Heating Value (LHV) efficiency. High temperature fuel cell-based power systems

offer clear efficiency advantages in comparison to other forms of distributed power generation. Certain

units are rated at 47% efficient in the generation of electrical power and up to 80% efficient overall in

Combined Heat and Power (CHP) applications. Typical fossil fuel-powered plants operate at about 35%

electrical power generation efficiency.

Financial Incentives: The Energy Policy Act of 2005 provides substantial financial incentives for fuel cell

power plants. Specifically, it grants a Federal investment tax credit of 30% or $1,000 per kilowatt

(whichever is lowest) of total project costs, as well as five-year accelerated depreciation. Californias Self-

Generation Incentives Program (SGIP) includes an $80 million annual allocation for renewable and ultra-

clean distributed generation technologies.

Reliability: Locating fuel cell-based power plant on-site and implementing real-time monitoring capability

assures end-users of increased reliability, a necessary requirement for applications such as manufacturing

facilities and hospitals. Unlike wind and solar technologies, which generally have an overall availability of

35%, fuel cell technology operates independently and has an availability of over 95%.


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7.0 OVERVIEW OF FUEL CELL TECHNOLOGIES

Growing demands for electrical power coupled with fuel cost pressures and

environmental constraints have created a need for new efficient and

sustainable sources of energy and electricity. Fuel cells have become an

increasingly promising potential source of power for military, commercial, and

industrial uses. Further, fuel cells are increasingly being deployed as stationaryand decentralized sources and in mobile units.

Fuel cells operate much like a battery, using electrodes and an electrolyte to

generate electricity. Unlike a battery, however, fuel cells never lose their

charge. As long as there is a constant fuel source, fuel cells will generate

electricity.

Three types of fuel cell appear to be most likely to continue being commercialized:

High-temperature solid oxide fuel cell (SOFC)

High-temperature molten carbonate fuel cell (MCFC)

Low-temperature polymer electrolyte membrane fuel cell (PEM)

Selection of a fuel cell technology for a specific application and in optimum response to local conditions requires

the detailed consideration of a number of factors, including but not limited to:

Exhibit 7.1. Example of a Direct Fuel Cell Power Plant


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1. Modeling and control of processes and systems

2. Base loading requirements

3. Materials selection and analysis for fuel cells

4. Fuel cell stack design and development

5. Anticipated operational lifetimes, MTBF, and maintenance cycles

6. Capability for handling fuel variability including gas-reforming technology

Consideration of these factors in addition to the criteria set out herein in Section 2.0 (Study Objectives), and the

five primary factors set out in Section 6.0 (Identification of Fuel Cell Technologies), pointed to MCFC as the

technology of choice.4

It is therefore MCFC technology that is analyzed in further detail in this report.

Unlike other fuel cell designs, MCFC internally reforms5

internal reformation

process

readily-available fuels such as natural gas or anaerobic

digester gas into the hydrogen gas required to actually power the fuel cell system. This

is a key ingredient to the MCFC Direct FuelCell

(DFC) produced by FuelCell Energy, Inc. and its ability to

operate at such high electrical power generation efficiency.

7.1 MOLTEN CARBONATE FUEL CELL (MCFC)

In essence, fuel cells are electrochemical devices that combine fuel with oxygen from the ambient air to produce

electricity and heat, as well as water. The non-combustion, electrochemical process is a direct form of fuel-to-

energy conversion, and it is much more efficient than conventional heat engine approaches. Fuel cells incorporate

an anode and a cathode, with an electrolyte in between (similar to a battery). The material used for the

electrolyte and the design of the supporting structure determine the type and performance of the fuel cell.

A general description of the MCFC technology with an integrated heat recovery system is provided in conjunction

with Exhibit 7.2 (see notes).

4The rapid advances in fuel cell system development have left current information available only in scattered journals and

Internet sites. A recent book, Advances in Fuel Cells,provides in-depth coverage of the topic over a broad scope. This volume

provides informative chapters on thermodynamic performance of fuel cells; macroscopic modeling of polymer-electrolyte

membranes; the prospects for phosphonated polymers as proton-exchange fuel cell membranes; polymer electrolyte

membranes for direct methanol fuel cells; materials for state of the art PEM fuel cells, and their suitability for operation above

100C; analytical modelling of direct methanol fuel cells; and methanol reforming processes. See Tim Zhao, K.-D. Kreuer, and

Trung Van Nguyen, Advances in Fuel Cells, Elsevier, ISBN 10: 0-08-045394-5, 499 pages.5Steam reforming (or hydrogen reforming or catalytic oxidation) is a method of producing hydrogen from hydrocarbons. On an

industrial scale, it is the dominant method for producing hydrogen. Steam reforming of natural gas, sometimes referred to as

steam methane reforming (SMR), is the most common method of producing commercial bulk hydrogen as well as the hydrogen

used in the industrial synthesis of ammonia. It is the least expensive method. At high temperatures (700 1100 C) and in the

presence of a metal-based catalyst (nickel), steam reacts with methane to yield carbon monoxide and hydrogen.

CH4 + H2O CO + 3 H2

Additional hydrogen can be recovered by a lower-temperature gas-shift reaction with the carbon monoxide produced. The

reaction is summarized by:

CO + H2O CO2 + H2
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Exhibit 7.2. Block Flow Diagram of MCFC System

Note 1: Water and fuel are preheated, the fuel thereby being humidified before being supplied to the anodes of the fuel cells.

Note 2: Fuel and water are heated to the required fuel cell temperature in a heat-recovery unit that transfers heat from system

exhaust gases. The heated humid fuel stream is sent to the fuel cell stacks where, as described above, the fuel is converted to

hydrogen, most of which is used in the electrochemical reaction.

Note 3: Fuel and air reactions for the molten carbonate fuel cell occur at the anode and cathode, which are porous nickel (Ni)

catalysts. The cathode side receives oxygen from the surrounding air. Hydrogen is created in the fuel cell stack through a reforming

process, which produces hydrogen from the reforming reaction between the hydrocarbon fuel and water. The gas is then consumed

electrochemically in a reaction with carbonate electrolyte ions that produces water and electrons. A fuel cell power plant consists ofmultiple fuel cells arranged in stacks to provide the required system voltage and power) and the equipment needed to provide the

proper gas flow and power conversion.

Notes 4 & 5: Residual fuel (4), i.e., fuel not consumed in the electrochemical reaction in the fuel cell stack, is supplied to a catalytic

reactor (5) to heat incoming air.

Note 6: The heated air flows to the cathode to provide the cathode reactants (oxygen from the air and carbon dioxide from the

anode reaction). The O2 supplied to the cathode, along with CO2 recycled from the anode side, reacts with the electrons to produce

carbonate ions that pass through the electrolyte to support the anode reaction.

Note 7: Cathode exhaust gas exits the system through the heat exchanger used to preheat the fuel and water supplied to the heat

recovery unit.

Note 8: Using fuel cell technology, the emission of CO2 is reduced due to the high efficiency of the fuel cells and the absence ofcombustion that avoids the production of NOx and particulate pollutants.

Note 9: With heat that can be extracted in the production of electric power (a bottoming process), co-generation using fuel cells can

represent a significant increase the efficiency of the power plant.

Note 10: The electron flow through the external circuit produces the desired power (DC current). An inverter is used to convert the

DC output to AC.


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8.0 IDENTIFICATION OF FUELCELL ENERGY'S DIRECT FUELCELLS

8.1 BENEFITS OF FUEL CELL TECHNOLOGY

FuelCell Energy's Direct FuelCell (DFC) power plants appear at this stage of

analysis to be an economical solution for reliable, Ultra-Clean baseload

power. State and federal incentive programs for purchasing and operatingultra-clean technologies such as DFCs clearly make the technology an

attractive alternative to traditional power generation systems.

An industry leader in fuel cell technology, FuelCell Energy has been

aggressively pursuing cost-reduction efforts in molten carbonate fuel cell

power plants. (See cost trend details in Section 10.0 of this report.) The

company also works closely with local governments to advance fuel cell

technologies. States seeking to secure cleaner energy sources are

legislating Renewable Portfolio Standards (RPS) to mandate that utilities

provide a certain amount of their electricity from renewable sources such as

solar, wind, and fuel cells. Twenty-two states currently have RPS laws on

their books. As of the date of this report, in five states (Connecticut, Hawaii,Maine, New York, and Pennsylvania) Ultra-Clean fuel cells operating on

natural gas qualify as renewable.

FuelCell Energys Direct FuelCell

(DFC) power plants meet these emission requirements and qualify for the SGIP.

In Connecticut, the Connecticut Clean Energy Fund (CCEF) is subsidizing 68 MW of new fuel cell power plants as

part of its "Project 100" program that is encouraging the installation of 100 MW of new renewable energy-

powered systems by state utilities. Internationally, the South Korea Ministry of Commerce, Industry and Energy

instituted a green energy program in 2006 that is providing financial assistance for environmentally efficient power

systems such as fuel cells. In Japan, FuelCell energy received the governments endorsement for DFC products

operating on anaerobic digester gas. (This was due to a favorable technical report on the performance and

availability of the DFC power plant at a municipal wastewater treatment facility in the city of Fukuoka.)

8.2 FUELCELL POWER GENERATING CAPACITY OPTIONS

FuelCell Energys DFC300MA system is a self-contained electrical power generation system capable of providing

high-quality baseload power up to 300 kW, with 47% efficiency 24 hours a day, 7 days a week.

Featuring ultra-low emissions, low operating noise, and a small footprint (600 sq. ft), the DFC300MA is suitable for

locations where traditional power generation technologies are not feasible or desirable. The DFC300MA can be

used for low-cost on-site power generation, cogeneration and Combined Heat and Power (CHP), distributed energy

grid support, and grid congestion relief. The system is suitable for a wide range of applications, including

manufacturing facilities, food/beverage processing plants, hotels, hospitals, universities, and utilities.

FuelCell Energys DFC1500MA system is a self-contained electrical power generation system capable of providing

1.2 MW of high-quality baseload power. The system has an electrical efficiency rating of 47%, giving it higherefficiency than other distributed generation plants of similar size with virtually no air pollution.

The DFC1500MA features ultra-low emissions and low operating noise and is suitable for locations where

traditional power generation technologies are not feasible or desirable. The DFC1500MA is easily installed in

comparison to other power generation technologies due to its modular design.


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The DFC1500MA can be used for low-cost on-site power generation, cogeneration, and Combined Heat and Power

(CHP), distributed energy grid support, and grid congestion relief. The system is suitable for a wide range of

applications, including wastewater treatment, manufacturing, large hotels, hospitals, and universities.

8.3 FUELCELL ENERGY,INC AND POTENTIAL ALTERNATIVE SOURCES /BUSINESS SECTOR COMPETITORS

FuelCell Energy notes in its 10K Risk Factors, that Other companies, some of which have substantially greaterresources than ours, are currently engaged in the development of products and technologies that are similar to, or

may be competitive with, our products and technologies.

While several companies in the U.S. are involved in fuel cell

development, FuelCell Energy appears to be the only domestic company

engaged in significant manufacturing and commercialization of

carbonate fuel cells. Emerging fuel cell technologies (and companies

developing them) include proton exchange membrane fuel cells (Ballard Power Systems, Inc.; United Technologies

Corp. or UTC Fuel Cells; and Plug Power), phosphoric acid fuel cells (UTC Fuel Cells), and solid oxide fuel cells

(Siemens Westinghouse Electric Company, SOFCo, General Electric, Delphi, Rolls Royce and Acumentrics).

FuelCell Energy, Inc. engages in the development, manufacture, and sale of fuel cell power plants for electric

power generation. Its core carbonate fuel cell products include Direct FuelCell and DFC Power Plants. The

company's carbonate fuel cell products electrochemically produce electricity from hydrocarbon fuels, such as

natural gas and biomass fuels. In addition, FuelCell Energy is developing hybrid products and planar solid oxide

fuel cell technology products. The company's power plants generate approximately 200 million kWh of power

using various fuels, including renewable wastewater gas, biogas from beer, and food processing, as well as natural

gas and other hydrocarbon fuels. Its products serve various commercial and industrial customers, including

wastewater treatment plants, hotels, manufacturing facilities, universities, hospitals, telecommunications/data

centers, and government facilities, as well as grid support applications for utility customers. The company has

operations in North America, Canada, Europe, Japan, and Korea. FuelCell Energy was founded in 1969 and is

headquartered in Danbury, Connecticut.6

Ballard Power Systems, Inc. engages in the design, development,manufacture,

and sale of proton exchange membrane (PEM) fuel cells. It operates in threesegments: power generation, automotive, and material products. Its power

generation segment offers PEM fuel cell products and services for the

residential co-generation, materials handling, and back-up power markets. Automotive segment provides PEM

fuel cell products and services for fuel cell vehicles. Material products segment designs, develops, manufactures,

and sells carbon fiber products primarily to automotive manufacturers for automotive transmissions, and gas

diffusion layer materials for the PEM fuel cell industry. The company has operations primarily in the United States,

Canada, Japan, and Germany. Ballard Power Systems was founded in 1979 as Ballard Research, Inc. and changed

its name to Ballard Power Systems, Inc. The company is headquartered in Burnaby, Canada.7

Energy Conversion Devices, Inc. commercializes materials,

products, and production processes for the alternativeenergy generation, energy storage, information

technology, alternative energy generation, energy storage,

and information technology markets. The company operates in two segments (United Solar Ovonic and Ovonic

Materials). The United Solar Ovonic segment designs, develops, manufactures, and sells proprietary thin-film solar

(photovoltaic or PV) modules, which are lightweight, thin, flexible, and durable products for converting sunlight

6http://www.fuelcellenergy.com/

7http://www.ballard.com/
http://www.fuelcellenergy.com/http://www.fuelcellenergy.com/http://www.fuelcellenergy.com/http://www.ballard.com/http://www.ballard.com/http://www.ballard.com/http://www.ballard.com/http://www.fuelcellenergy.com/


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into electricity. It sells these PV modules to commercial roofing materials manufacturers, builders and building

contractors, and solar power installers/integrators, who incorporate these PV modules into their products and

services for commercial sale. The company also sells PV modules for ground-mounted and residential applications

and, for some applications, manufactures and sells framed PV products.

The Ovonic Materials segment invents, designs, and develops materials and products based on its materials

science technology, principally amorphous and disordered materials. The company is commercializing NiMHmaterials and consumer battery technology through this segment internally and through third-party relationships,

such as licenses and joint ventures. It licenses NiMH battery technology to NiMH battery manufacturers,

principally for consumer applications and produces proprietary positive electrode nickel hydroxide materials for

use in NiMH batteries, which it sells to licensees of its NiMH battery technology. The company also engages in pre-

commercialization activities for various emerging technologies, such as Ovonic solid hydrogen storage

technologies, Ovonic metal hydride fuel cell technologies, and Ovonic biofuel reformation technologies.

Ovonic is developing rugged, kW-scale metal hydride fuel cells targeted at backup and mission-critical power for

military and commercial applications.

The company operates in the United States, Germany, China, Japan, Italy, and internationally. Energy Conversion

Devices was founded in 1960 and is headquartered in Rochester Hills, Michigan.8

Plug Power, Inc., together with its subsidiaries, engages in the design,

development, and manufacture of on-site energy systems for energy

consumers worldwide. It focuses on platform-based systems, which

include proton exchange membrane, fuel cell, and fuel processing

technologies. The company offers its GenCore product, which provides direct-current back-up power for

telecommunication, broadband, utility, and industrial uninterruptible power supply market applications. It is also

developing its GenSys product, which offers remote continuous power for light commercial and residential

applications; prototype fuel cell systems that provide electricity and heat to a home or business; as well as

hydrogen fuel for a fuel cell vehicle. The company's customers include telecommunications companies, utilities,

government entities, and distribution partners. It has strategic partnerships with Honda R&D Co Ltd. of Japan;

Vaillant GmbH; General Electric Company; Engelhard Corporation; and Pemeas. Plug Power was founded in 1997

and is based in Latham, New York.9

In addition to developments in fuel cell technologies, competition in this electrical power generation sector arises

from such companies as Caterpillar, Cummins, and Detroit Diesel: companies that manufacture mature

combustion-based equipment, including various engines and turbines, and have well-established manufacturing,

distribution, and operating and cost features. Significant competition may also come from gas turbine companies

like General Electric, Ingersoll Rand, Solar Turbines and Kawasaki, which have recently made progress in improving

fuel efficiency and reducing pollution in large-size combined-cycle natural gas-fueled generators.

8.4 PERFORMANCE OF FUELCELL ENERGY,INC.

A significant indicator of the health and future prospects of a company is the extent of its on-going R&D work,

efforts to improve productivity, competitiveness, and long-term profitability. FuelCell Energy is working to develop

next-generation fuel cell products focusing on a combined-cycle Direct FuelCell/Turbine (DFC/T) power plant,

Solid Oxide Fuel Cells (SOFC), the co-production of hydrogen, electricity and heat (DFC/H2), and liquid fueled

military applications.

8http://www.energyconversiondevices.com/

9http://www.plugpower.com/
http://www.energyconversiondevices.com/http://www.energyconversiondevices.com/http://www.energyconversiondevices.com/http://www.plugpower.com/http://www.plugpower.com/http://www.plugpower.com/http://www.plugpower.com/http://www.energyconversiondevices.com/


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The historical trends related to product revenues and the prospect for future revenues reflected in the backlog of

orders, if any, are also significant indicators of the robustness of an enterprise. The data displayed in Exhibit 8.1

were uniquely developed as part of EquityNets research and show these factors as an indicator of FuelCell

Energys marketplace performance.

Also of note, regarding the status of the company, in 2006, FuelCell Energy was selected by U.S. Department of

Energys National Energy Technology Laboratory to re-direct its Solid State Energy Conversion Alliance (SECA)

program to coal-based solid oxide fuel cell (SOFC) power plant development. The objective of this new 3-phase,

$85 million, ten-year program is to develop multi-MW class SOFC power plants operating on coal-based syngas.10

10See FuelCell Energy, Inc. annual reports athttp://fcel.client.shareholder.com/annuals.cfm.

Exhibit 8.2. FuelCell Energy, Inc. Financial Performance Data

FISCAL YEAR END October 31, 2002 2003 2004 2005 2006

(Dollars in thousands, except per share data)

Product sales and revenues $7,656 $16,081 $12,636 $17,398 $21,514

Research and development contract revenues $33,575 $17,709 $18,750 $12,972 $11,774

Total Revenues $41,231 $33,790 $31,386 $30,370 $33,288

Net loss to common shareholders ($48,840) ($67,414) ($87,407) ($74,263) ($84,222)

Basic and diluted loss per share:

Continuing operations ($1.25) ($1.71) ($1.84) ($1.51) ($1.65)

Discontinued operations $ $ $0.01 ($0.03) $

Net loss to common shareholders ($1.25) ($1.71) ($1.83) ($1.54) ($1.65)Total assets $289,803 $223,363 $236,510 $265,520 $206,652

Total shareholders equity $271,702 $205,085 $202,705 $130,964 $100,795

Total cash and investments $220,538 $153,440 $152,395 $179,960 $120,587

Exhibit 8.1. Marketplace Performance of FuelCell Energy, Inc.

Product Revenue & Backlog

0

2,000

4,000

6,000

8,000

10,000

12,000

12/ 31/ 99 12/ 30/ 00 12/ 30/ 01 12/ 30/ 02 12/ 30/ 03 12/ 29/ 04 12/ 29/ 05 12/ 29/ 06 12/ 29/ 07 12/ 28/ 08

Revenue

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Backlog

Revenue

Backlog
http://fcel.client.shareholder.com/annuals.cfmhttp://fcel.client.shareholder.com/annuals.cfmhttp://fcel.client.shareholder.com/annuals.cfmhttp://fcel.client.shareholder.com/annuals.cfm


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9.0 INTEGRATION WITH BRIGHTER BIOENERGY PARTNERSWASTE-TO-ENERGY CONVERSION PROCESSES

The primary waste-to-power conversion technology that Brighter BioEnergy Partners is expected to use is plasma

arc conversion potentially in conjunction with bio-digesters for certain biogenic and agricultural wastes. Both

systems produce off-gases with good energy content but with a variable composition depending on waste stream

(feedstock) input and process operating conditions. Such off-gas streams may not be suitable for direct sale or for

injection into natural gas transmission lines without substantial and expensive treatment and measures for qualitycontrol that could impose sub-optimal operating conditions on the primary waste-to-energy system components.

On-site use of the off-gases for electrical power generation, using high-temperature fuel cell technology combined

with an integrated low-level heat recovery, could reduce these project constraints. Five primary indicators point to

the use of such high-temperature fuel cells as the alternative technology of choice, including fuel flexibility,

minimizing environmental impact, energy efficiency, the availability of certain financial incentives to adopt this

technology, and operational safety and reliability. With appropriate contractual arrangements in place, excess

electrical energy produced could be sold into the grid.

Exhibit 9.1. System Concept for Considering Alternatives in Electrical Power Generation

BioEnergy

ConversionSystem(s)

Feedstocks

(Handling / blending)

Raw GasesStream

SolidsStream

WasteStreams

Gas Treatment,Fractionation,

Storage/Handling

Solids Treatment &

Materials Handling

WasteTreatment & Recycle

(on-site)

Feedstock

(backup & energybalance)

Electrical(Grid)

Waste StreamsTDFCoal

Power Generation(Alternatives &/or

Multiple units)

BioEnergy Partners, LLC:Electrical Power Generation Considerations

Last Revised: Oct 27, 2007 / RRG

System - INFLOWS

Utilities

OUTFLOWS(co-products;

minimized waste)


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10.0 MOLTEN CARBONATE FUEL CELL COST TRENDS

10.1 BASIS FOR POWER GENERATION COST COMPARISONS

Around the world, natural gas-fired turbine combined-cycle plants are regularly operating at efficiencies well

above 50%, with a capital cost in the range of about $600 per kilowatt. (Regular steam plants are $1,200 to $1,600

per kilowatt, and nuclear plants cost $1,500 to $3,000 per kilowatt.)

The capital investments needed to support electric-generating capacity growth are substantial. Building 154

Gigawatts of new coal-fueled capacity by 2030 would entail capital investments on the order of $230 billion at an

average capital cost of $1,500 per kW of installed capacity.

These new plants will be subject to stringent EPA requirements including New Source Performance Standards to

reduce emissions of sulfur and nitrogen oxides, particulate matter, and mercury. The Clean Air Act also requires

the use of Best Available Control Technology, determined by states on a case-by-case basis. Roughly one-third of

the capital investment required to build new coal generation capacity is dedicated to air and water pollution

control equipment. Ultimately, these future state-of-the-art generating facilities will lead to a cleaner

environment.11

For geothermal sites in California and Nevada, the capital cost of incremental generation capacity averages about

$3,100 per installed kilowatt (kW). For California sites alone, the average capital cost of incremental generation

capacity may be somewhat lower, at about $2,950 per installed kW. These cost estimates include the following

components:

Exploration (up to siting of the first deep, commercial-diameter well)

Confirmation drilling (up to achieving 25% of required capacity at the wellhead)

Development drilling (up to achieving 105% of required capacity at the wellhead)

Construction of the power plant (including ancillary site facilities)

Transmission-line costs

The capital cost for specific geothermal projects ranged from about $1,000 per kW (for a small expansion at an

existing project), to values in excess of $6,000 per kW (for deep, low-temperature resources at remote locations).Of the 4,300 gross MW of most-likely incremental capacity available from both California and Nevada, about 2,500

gross MW is available at a capital cost less than the average of $3,100 per kW. Considering geothermal fields only

within California, about 2,000 gross MW of incremental generating capacity is available at a capital cost below the

average of $2,950 per kW.12

Recently, there has been a great deal of attention focused on fuel cells and their high thermal or thermodynamic

efficiencies, often quoted in the 50 to 70 percent range. But when the need to externally produce mostly pure

hydrogen from a hydrocarbon fuel is included, overall thermal efficiencies can drop to about 30 percent for a 200

kW unit, with capital cost of as much as $5,000 per kilowatt. Molten carbonate fuel cells (MCFCs) internally reform

gas into the hydrogen gas required to power the fuel cell system, and this internal reformation process is a key

ability to operations with high electrical power generation efficiency.

10.2 12-YEAR TREND IN MCFC-BASED INSTALLED CAPACITY COST

With both the technical feasibility demonstrated and compatibility of the use of fuel cells (MCFC) with the

technologies for waste-to-energy conversion anticipated by Brighter BioEnergy Partners appearing to have

11http://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdf

12www.geothermal.org/articles/Lovekin.pdf
http://64.226.55.6/technology.phphttp://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdfhttp://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdfhttp://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdfhttp://www.geothermal.org/articles/Lovekin.pdfhttp://www.geothermal.org/articles/Lovekin.pdfhttp://www.geothermal.org/articles/Lovekin.pdfhttp://www.geothermal.org/articles/Lovekin.pdfhttp://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdfhttp://64.226.55.6/technology.php


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numerous advantages, the likely determining factor for the adoption of MCFC for use in their project will be costs

for both installed capacity and operational.

The cost for installed capacity for MCFC has consistently trended downward for more than a decade (Exhibit 10.1

below), while costs for certain other systems have increased, largely due to increasing requirements to meet

environmental constraints.

Comments made previously in Section 3.0 of this report concerning the impact of natural gas pricing on energycosts are ameliorated to a large degree in the Brighter BioEnergy Partners proposed project. The fuel gases in

that project are to be produced from multiple waste streams (and may reasonably be taken to be renewable

energy sources independent of pressures on natural gas pricing).

Operational costs for MCFC-based power generation facilities (of the size anticipated by Brighter BioEnergy

Partners) are projected to be similar to those for other power generation plants, but they may be substantially less

where fuel (natural gas) costs are included. Projections for technical improvements that will extend the present

40,000-hour charge life and maintenance cycle ratings demonstrate the potential to further reduce MCFC

operational costs.

Exhibit 10.1. Fuel Cell (MCFC) Market Price: Trending Towards Grid Parity

Source: FuelCell Energy (including projections from 2006 through 2009).


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11.0 CONCLUSIONS AND RECOMMENDATIONS

This study and analysis were designed to provide essential, independently-(non-vendor)-derived information as a

sound basis for selecting an optimal electrical power generation technology for integration into the waste-to-

energy conversion project being considered by Brighter BioEnergy Partners, LLC.

Using explicit criteria for the identification and qualification of alternative electrical power generationtechnologies, the use of high-temperature (molten carbonate) modular fuel cells is identified as presenting the

greatest opportunity. This type of fuel cell, as produced and placed into commercial service by FuelCell Energy, is

specifically identified as a best fit to the selection criteria.

A recommendation for a possible next phase of design studies and more detailed engineering and cost analysis are

provided assuming a conventional three-phase approached as outlined below. This technology assessment serves

as the Level I Analysis.

Level I Analysis (Alternatives Identification and Screening Analysis)

The primary purpose of the Level I analysis is to establish whether a technology is potentially a "good candidate"

for use in a proposed project. After the identification of candidate technologies against a set of predeterminedproject criteria, this level of analysis typically uses "rules-of-thumb" or typical performance characteristics of

various technology systems and averages of annual costs. Level I analysis may also provide rough estimates of

energy cost savings, installed cost, and payback period for selected technologies. The cost accuracy of this level of

analysis is, at the best, 30 percent.

If results of Level I analysis are encouraging, these should be discussed with potential project participants. During

these discussions, it is important to point out the "limited accuracy" of this level of analysis. If all section criteria

are met and the potential payback period, and capital cost needs are acceptable to the project participants and

decision makers, then it may be recommended that a Level II analysis be conducted.

Level II Analysis (Conceptual Design and Preliminary Financial Analysis)

The purpose of the Level II analysis is to ascertain with a much higher degree of confidence that a technology

system is technically and financially viable. This level of analysis is performed using a detailed engineering and

financial model that uses, at least monthly (but preferably projected hourly) energy load profiles. The results of

this level of analysis are estimates of annual cost savings based on the profiles generated by the model. A few

software tools are available for performing some of the Level II modeling, systems simulation, and analysis. The

scope of this level of effort also includes developing one-line drawings for the conceptual design (including

equipment sizes). The cost accuracy of Level II estimates is typically about 20 percent.

The results of Level II analysis should be discussed in detail with project participants and decision makers. If the

results of the analysis are still attractive and do not reveal any "show-stoppers," even after another site walk-

through for a more detailed site evaluation, and the end user continues to be interested and has the financial

capability to move forward, a contract should be considered to have an experienced A&E firm conduct the next

level (Level III) analysis.

Level III (Detailed Engineering Design and Analysis)

The purpose of this level of effort is to perform a detailed engineering analysis and develop firm cost estimates for

the project. In this level of effort, detailed procurement specifications are developed for all system components,

cost bids are obtained for those components, and all costs relating to environmental and other permits are also

developed.


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Based on the estimates of firm costs, revised estimates are developed for a payback period and return on

investment. Many (if not most) projects that reach this stage are ultimately implemented.

Based on the results of this study and analysis, it is recommended that Brighter BioEnergy Partners and its

associated enterprises and agencies, after due consideration of the present study and analysis, undertake a Level II

Design and Analysis as its project planning proceeds.


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12.0 APPENDIX

12.1 REFERENCES AND IDENTIFICATION OF SOURCE MATERIALS

Energy Information Administration, U.S. Department of Energy, Electric Power Annual with Data for 2006, 2007;

http://www.eia.doe.gov/cneaf/electricity/epa/epa.pdf

Henning, Bruce, Michael Sloan, and Maria de Leon, Natural Gas and Energy Price Volatility , American Gas

Foundation for the Oak Ridge National Laboratory, 2001;

http://files.harc.edu/Sites/GulfCoastCHP/Publications/NaturalGasEnergyPriceVolatility.pdf

Lovekin, Jim, Geothermal Inventory: New Study Highlights Geothermal Resources Available for Development in

California and Nevada, November-December 2004 GRC Bulletin, California Energy Commission, pp. 242-244;

www.geothermal.org/articles/Lovekin.pdf

National Energy Technology Laboratory, U.S. Department of Energy, Fuel Cell Handbook, University Press of the

Pacific, 2005; ISBN-13: 978-1410219602

Fuel cells are an important technology for a potentially wide variety of applications including micropower,auxiliary power, transportation power, stationary power for buildings and other distributed generation

applications, and central power. These applications will be in a large number of industries worldwide.

This edition of the Fuel Cell Handbook is more comprehensive than previous versions in that it includes

several changes. First, calculation examples for fuel cells are included for the wide variety of possible

applications. This includes transportation and auxiliary power applications for the first time. In addition,

the handbook includes a separate section on alkaline fuel cells. The intermediate temperature solid-state

fuel cell section is being developed. In this edition, hybrids are also included as a separate section for the

first time. Hybrids are some of the most efficient power plants ever conceived and are actually being

demonstrated. Finally, an updated list of fuel cell URLs is included in the Appendix, and an updated index

assists the reader in locating specific information quickly.

Sammes, Nigel, Fuel Cell Technology: Reaching Towards Commercialization (Engineering Materials and

Processes), Springer, 1st edition, 2006; ISBN-13: 978-1852339746 (Fuel Cell Technology is a one-volume survey of

the state-of-the art research in fuel cells.)

Singhal, S. C. and K. Kendall (eds.), High-temperature Solid Oxide Fuel Cells: Fundamentals, Design and

Applications, Elsevier Science, 1st edition, 2004; ISBN-13: 978-1856173872

The growing interest in fuel cells as a sustainable source of energy is pulling with it the need for new

books to provide comprehensive and practical information on specific types of fuel cell and their

application. This landmark volume on solid oxide fuel cells contains contributions from experts of

international repute and provides a single source of the latest knowledge on this topic. (Amazon Review).

Trisko, Eugene M., America Needs New Power Plants!, 2006;

http://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdf
http://www.eia.doe.gov/cneaf/electricity/epa/epa.pdfhttp://www.eia.doe.gov/cneaf/electricity/epa/epa.pdfhttp://files.harc.edu/Sites/GulfCoastCHP/Publications/NaturalGasEnergyPriceVolatility.pdfhttp://files.harc.edu/Sites/GulfCoastCHP/Publications/NaturalGasEnergyPriceVolatility.pdfhttp://www.geothermal.org/articles/Lovekin.pdfhttp://www.geothermal.org/articles/Lovekin.pdfhttp://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdfhttp://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdfhttp://www.ceednet.org/docs/America%20Needs%20New%20Power%20Plants%20-%20Trisko.pdfhttp://www.geothermal.org/articles/Lovekin.pdfhttp://files.harc.edu/Sites/GulfCoastCHP/Publications/NaturalGasEnergyPriceVolatility.pdfhttp://www.eia.doe.gov/cneaf/electricity/epa/epa.pdf


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12.2 EXCLUSIONS,CONTACT INFORMATION, AND DISCLAIMERS

Exclusions

The information provided to Brighter BioEnergy Partners in this Study and Analysis does not provide or nor does it

include:

Detailed engineering design;

Business planning or strategic market analysis or planning;

Comprehensive development plan evaluation or validation other than as it provides the context for

technology identification and potential for future deployment; nor

Comprehensive determination of potential patent(s) infringement.

Contact Information

FuelCell Energy, Inc.

Global Headquarters

3 Great Pasture RoadDanbury, CT 06813

203-825-6000

[email protected]

Manufacturing Facility

539 Technology Park Drive

Torrington, CT 06790

860-496-1111

Contacts providing information for this Report:

Andy Skok (Canada)

Technical Product & Marketing203.825.6068

[email protected]

John Franceschina (New York)

Technical & Business Development631.574.4458

[email protected]

Disclaimer

This report is for an initial study and analysis of alternatives in electrical power generation technologies to

specifically complement Brighter BioEnergy Partners waste-to-energy conversion system including certain

elements of an assessment of technologies. It does not constitute or provide a level of information adequate to

stand alone in consequential business decision making, nor should it be considered to be a substitute for an

analysis of the proponents business plan as would be done in full investor due diligence.

12.3 ASSUMPTIONS AND LIMITING CONDITIONS

EquityNet, LLC is not a law firm. Issues that may have a legal impact are considered from a laypersons perspective

using the reasoning expressed or implied within the report. Should such matters be material to the users of this

report, proper legal counsel should be obtained.
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


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________________________________________________________________________________


This study will be based upon information obtained from sources that, with exceptions, if any, as noted herein, the

consultants believe to be reliable. However, the consultants will not make a specific effort to confirm the validity

of any of the information, and accordingly, its accuracy or completeness cannot be guaranteed.

Other than any specific exceptions described within the report, in reliance on the Clients representations,

EquityNet, LLC has not reviewed any legal documents. In addition, to the extent that EquityNet, LLC has reviewed

any such documents, it is acknowledged that evaluation of same, relative to any legal considerations or impact areoutside the skills of the consultants.

EquityNet, LLC did not review prior art as required by USPTO of the patent applicant and did not provide

information on patent applications filed but not yet published. There is no intent to predict any reviews,

allowances, or actions by the USPTO; and this project was not intended as an analysis or assessment of system

practicability or functionality (all claims accepted as presented in the patent application).

Possession of this report, or a copy, does not carry with it the right of publication of all or any part of this report

without the expressed written consent of the consultants, and then only in the event of proper attribution. Should

you provide copies or the right of review to others, said other parties may be assured that while EquityNet, LLCs

report was performed in the employ of our client, it was prepared on a non-advocacy basis. Said other parties,

however, are cautioned that EquityNet, LLC has no duty to you, and therefore no warranty is expressed or implied.

Nothing in this report is intended to replace any third party's independent sole judgment, due diligence, or

decision to seek counsel. All such other parties will be considered unintended users under the terms of our

engagement.

Neither our findings nor this report constitutes advice for any specific action. This report is further subject to any

other contingencies, assumptions, and limiting conditions set out elsewhere within this report.

12.4 ATTACHMENTS

FuelCell Energy, Inc. Contact Information Sheet

FuelCell Energy, Inc. SEC 8-K form, December 11, 2007 (most recent financials filing)

DFC300MA Product Specifications

DFC1500MA Product Specifications

(NOTE: These attachments are not included in this sample reported as accessed via the EquityNet research

services webpages.)

technology assessment (sample)

Documents