Fuel Cells Revving Investors' Engines
By Adam Peeler
Staff Writer
The race to gain a lion's share of the fuel cell market appears to be heating up.
Last week, Global Thermoelectric Inc. (TSE: GLE) announced it successfully tested a
solid-oxide fuel cell system running directly on natural gas. The economic aftermath of the
Calgary-based company's declaration was immediate. Stock value shot up 65 cents Thursday closing at $10.05. The stock closed at $9.30 Monday on 20,853,350 shares issued.
Perhaps as equally intriguing as the commerce involved are the potential long-term
changes fuel cell technology will create on a deteriorating landscape. A fuel cell is an
electrochemical device that takes a fuel like hydrogen and combines it with oxygen to produce electric power, heat and water. The fuel isn't burned but electrochemically
combined with the oxygen in the air. Because there is no burning, the cell doesn't generate
harmful emissions.
"What you have to wonder is are you going to see hydrogen stations on every corner just like gas stations?" says Global CEO Jim Perry. "Will fuel cells be the primary movers of
cars? I don't know. The biggest question is what's the fuel going to be."
Recently, Global positioned itself to provide a loud answer to that query.
In April, they inked a deal with Delphi Automotive Systems Corp. (NYSE: DPH), the world's
largest supplier of automotive components, systems and modules, to develop a solid-oxide
fuel cell system.
"All fuel cells require hydrogen and oxygen to produce electricity," explains Jim Lumsden,
vice-president of research and development for Global. "Our integral reformer uses heat
generated by the solid-oxide fuel cells to produce hydrogen directly from natural gas, a
commonly available fuel. This small, inexpensive and simple reformer will provide Global
with a significant cost and reliability advantage versus other fuel cell systems that require a
complicated external gas reforming and purification system."
Ballard Power Systems (TSE: BLD), based in Burnaby, B.C. falls into the category of
companies focussing on 'other fuel cell systems'. They have created a recent stir in the
automotive world by teaming up with heavyweights Ford and DaimlerChrysler to create test
cars running on fuel cells. Ballard uses a cell known as a PEM or Proton Exchange
Membrane. The application operates at a low temperature allowing for easy handling. But
the drawback, according to Global, is that PEM requires pure hydrogen and the purifying
process is time consuming.
"We don't really consider Ballard a competitor because they use different technology," says
Global's Perry.
Delphi (a May spin-off of automotive albatross General Motors) had enough faith in Perry's
company to invest a "nominal dollar amount" to develop Global's fuel cell technology.
"All I can say about the deal is it's a future technology issue," says Delphi's Linda
Beckmeyer. "It's a very competitive market so we keep our cards close to our vest."
Asked whether an April deal with BMW to develop vehicles using a solid-oxide fuel cell
would impact Global's fortunes, Beckmeyer responds, "We do business with a variety of developers so we have development agreements on the go at all times. You can read into
that what you want." |
