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Gold/Mining/Energy : Bloom Energy - Bloom Box

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To: Glenn Petersen who wrote (30)	10/24/2010 2:53:21 PM
From: m3ggiesdad	Read Replies (1) of 67

Hi All Ever heard of this UK based company?. www.afcenergy.com On the verge of going commercial, 1/7th the cost of a Bloom box. Taken from UK bullboard iii.co.uk Bloom Energy is a Californian based company producing solid oxide fuel cells (a different type of fuel cell to AFC’s). Someone mentioned how much Bloom might float for in an IPO in a previous post. This article states between $936 million and $1.034 billion. energydeals.wordpress.com For sake of ease let’s call it $1b. That = £637,612,777.76 with todays exchange rate. That market cap would give AFC a share price of £3.67. OK, so Bloom and AFC are different companies and it is never as simple as that so let’s dig deeper. The same article states that a ‘Bloom box’ costs $700,000 for 100KW. That is equal to £4460 per kw. AFC Energy costs £35000 for a 50KW unit. That is equal to only £700 per kw. That makes AFC fuel cells 6.37 times cheaper than Blooms. The Bloom units also run at temperatures higher than 800 degrees Celsius. AFC fuel cells operate at only 70 degrees Celsius - a clear advantage. All the companies currently using a Bloom box are based in California. The Californian government pays significant subsidies to the companies which use a Bloom box and this makes it cheaper than power from the grid. Without the subsidy Bloom is way more expensive than the grid. Based on the link below (an interview with Bloom) they will never be more efficient than a big power plant and it will be another decade before they can be at a scale to have a transformative effect. newsweek.com Now let’s think about AFC who are right on the verge of going commercial. AFC are way cheaper than Bloom. They are being considered to be used in big power plants (Air Products, Linc Energy, Powerfuel). Subsidies are not required to make the use of AFC fuel cells financially viable. They are at this stage now and don't need to wait a decade to get there. They are at the start of having a tranformative effect imo. In fact in a decade as they improve their systems further they will be even cheaper and even more efficient. Based on this the people who value Bloom at $1b should value AFC at more than $1b due to it’s cheaper and more efficient product and based on its customers (or imminent customers) – Linc, Powerfuel, Akzo, Ineos, Centrica etc etc etc. That valuation is greater than £3.67. AFC fuel cells are 6.37 times cheaper than Blooms. Should that make the share price valuation 6.37 times more - £23 per share? I try not to buy in to Fuelcells valuations on LSE because I don't want to get too excited but the numbers he refers to do all add up and perhaps the £10, £20 or even £30 per share is a realistic target for a few years time.... By JAW74

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