Fuel Cell Industry & Patent Overview 2015 Cell Industry & Patent Overview 2015 Created in...

Fuel Cell Industry & Patent Overview 2015

Created in partnership with Blue Vine Consultants and HGF Intellectual Property Specialists

Fuel Cell Industry & Patent Overview May 2015

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ForewordFuel cell technology is very attractive with its highly efficient conversion of energy from fuel to electricity. The technology is a ready source of power for many applications and the market potential, together with the added draw of being part of a future green energy economy with hydrogen as the energy vector, has attracted a vast level of effort by many organisations since the 1980s.

The technology has proved complex and the potentially enormous market growth has shown tantalising promise for some time. In most cases the technology is competing with established and low cost incumbent technologies which have set a high barrier to commercialisation.

However, the market promise appears to be starting to come to fruition, for instance in the commercial growth of home-based chp units especially in Japan; in the rise of share prices of emerging North American fuel cell companies reflecting the commercial progress by, for example, Bloom Technologies, Ballard and Plug Power; most recently in the automotive market activity with heavyweight-auto OEM Toyota launching the Mirai to add to the previous launch of the Hyundai ix35; several other car companies are primed to follow suit.

The story of the development of this complex technology is reflected in the large patent portfolio and the many academic publications. These have arisen as developers have made progress in the designs of stacks and systems and in establishing routes to overcome some of the challenges such as durability and cost and application-specific issues such as cold start for automotive. Activities in manufacturing and cost reduction continue as the technology gets closer to increasing market penetration.

Patents continue to be an important factor in the commercialisation as can be seen in the successive purchases of former UTC patents by Ballard and Volkswagen, and Toyota’s action to share its patents in the short term to stimulate the growth of the automotive market.

This review shows how the latest stage in the development of the technology and its emergence into the market is reflected in the patent activity; and how the technology development is reflected in the academic interest, with some deep insights from experts involved in the industry.

Dr Andrew M CreethCTO, ACAL Energy Ltd



Fuel Cell Patent & Industry Overview 2015Executive Summary

In this report we assess the state of the fuel cell sector by reviewing the industry from the perspective of the commercial players, patent activity and academic interest within the sector. From our research, we have identified over 100 companies globally that are manufacturers or distributors (or both) of fuel cells. The USA, Germany and Japan are mostly where these companies are located, all of which have historically been hot spots of fuel cell activity.

Analysis of the patent data shows that there has been an overall decline in fuel cell patent activity over the last few years. This can be seen across all of the major patent offices globally, and in respect of the filing statistics of the major players. Based on this data, the declining trend looks set to continue over the coming years. This could be a sign that the sector is maturing to the point where companies are preparing for large-scale commercialisation or it may indicate a schism in the attitudes of, for example major OEMs with some remaining highly focussed on fuel cell technology and some becoming increasingly sceptical. The top patent assignees’ are also identified, with Toyota heading up this list, followed by other automotive OEMs, and electronics manufacturers.

Interest within the academic world on fuel cells has been increasing over the last decade. This may indicate renewed areas of fundamental research or increased academic effort to drive up efficiencies, for example, which may lead to downstream opportunities in the commercial exploitation of the technology.

In-depth case studies of SFC Energy and Bloom Energy are presented which show how companies are successfully entering and penetrating markets. This is happening despite the high capital cost of the fuel cell, which is often cited as a reason for the lack of commercialisation of fuel cells.

Finally, seven fuel cell industry experts were interviewed and their opinion on the outlook of the sector is presented. The general consensus is that the future of the industry is very promising, especially with the advent of several fuel cell vehicles in the near future.

Based on our understanding of the industry, the data presented herein as well as third party research and media articles, we believe that those of the major players which remain enthusiastic about the opportunities for fuel cells may well be moving towards consolidating their existing technical positions to facilitate further commercialisation.



Contributor Section About HGF

HGF is one of the pre-eminent firms of patent & trade mark attorneys in the UK. HGF has a reputation for providing commercially-focussed IP advice and a high quality, client-focused service.

Our attorneys invest a considerable amount of time working directly with clients to understand their needs and to devise the best IP strategy for protecting their intellectual assets. HGF is the winner of many awards and accolades and has within its ranks acknowledged national and international leaders in securing and protecting IP and devising strategies to maximise value.

About the Authors

Dr Chris MoorePartner at HGF [email protected]

Chris is a partner in HGF and Head of our Birmingham Office. He advises SMEs, multinationals and academic institutions on uncovering, protecting and leveraging their intellectual capital. Chris has been consistently ranked in the highest tier of patent attorneys in both Chambers & Partners and Legal 500. He has undertaken due diligence work for VCs, PE firms as well as in respect of MBOs/MBIs.

Chris’s practice covers chemistry and engineering fields, with specialisations in green technology (including fuel cells and other alternative energies), plastic electronics (PVs, OLEDs), aerospace and automotive technologies, ceramics, polymers, metallurgy and analytical chemistry/instrumentation.

Jason LessardPatent Director at [email protected]

Jason is a Patent Director in our Birmingham office. He has a diverse background, having worked in design and technical sales in Canada and Europe before entering the patent profession, having successfully completed the USPTO Patent Bar Exam and having qualified as a European and UK patent attorney. This experience shapes his approach to advising clients; he delivers commercially-focused outcomes that add real value to client’s businesses.

Jason’s practice covers a wide range of mechanical and electromechanical technologies with a particular emphasis on aerospace, automotive and packaging. He has specific knowledge and experience in injection moulding and plastics processing technologies, engines and transmission systems, aerodynamics, defence & assault equipment, renewable energy harvesting equipment, medical devices and diagnostic systems.



Contributor Section About Blue Vine Consultants

Blue Vine Consultants are an award winning company based within the energy, technology and sustainability sector. They provide the valuable service of market research, intelligence and strategy for innovative, high tech and sustainable technologies.

Blue Vine Consultants is primarily comprised of Scott Hardman and Amrit Chandan as well as the Blue Vine Associate network, which consists of various experts within the fi eld from Academia and Industry. Their respective expertise within the marketing and market research for energy products has given them the basis and credibility to consult for companies helping their clients to maximise their profi t margins.



About the Authors

John Geoffrey MaillardDoctoral Researcher [email protected]

John is a doctoral researcher in Chemical Engineering at the University of Birmingham. A Masters level Chemical Engineering graduate, John has significant experience in team and group projects, working on tasks ranging from design of CHP and anaerobic digestion facilities at a paper recycling facility to competing in a industrial sponsored challenge to put forward green solutions to the current energy crisis whilst meeting cost viability throughout. Consulting in research of novel fields for engineering companies like Teer Coatings (MIBA) and international research collaborations with Indian Universities underpins an ability to work successfully with both private and public sectors.

Scott HardmanBlue Vine Consultants Director [email protected]

Scott is a director of Blue Vine Consultants and a doctoral researcher working at the Doctoral Training Centre in Hydrogen Fuel Cells and in the Business School at the University of Birmingham. This combination of technical and business backgrounds enables him to advise companies on how to take high tech products to market. Scott has experience consulting with technology companies in the UK and Europe and is currently employed as a consultant for the European Fuel Cell Forum. He has published in high impact international journals. Scott recently worked as a visiting scholar at UC Davis in California, where he researched energy trends in California, hoping to bring some of the innovation in this area across to the UK and EU.

Dr Amrit Singh ChandanBlue Vine Consultants Director [email protected]

Amrit Chandan is a director of Blue Vine Consultants. He is also a postdoctoral researcher in Chemical Engineering at the University of Birmingham. He has experience consulting for a variety of companies ranging from SMEs to large corporations. Specifically, Amrit has a lot of experience in taking abstract technical concepts and turning them into Unique Selling Points. This enabled Amrit to lead on planning the marketing strategy for the roll out of a hydrogen infrastructure on the east coast of the USA as part of the International Hydrogen Design Contest. His contributions, along with other team members, led the team from the University of Birmingham to a joint first prize in this international competition. Amrit, along with Scott, was named the Business Quarterly Magazine’s Emerging Entrepreneur in 2014.



Contents

1 Introduction 11.1 Methods 32 Fuel Cell Manufacturers and Distributors 42.1 Geographic Distribution 82.2 Fuel Cell Manufacturers by Fuel Cell Type 103 Patent Analysis 113.1 Setting the Scene 113.2 Fuel Cell Patent Activity 153.2.1 Filing Statistics 153.2.2 Granted Fuel Cell Patents 203.2.3 Assignee Data 224 Academic Research Trends 285 Company Case Studies 295.1 Bloom Energy 295.1.1 Bloom Energy- Summary 305.2 SFC Energy 315.2.1 SFC Energy- Key Markets 325.2.2 SFC Energy- Summary 336 Fuel Cell Industry- Outlook from Experts 346.1 Changing Landscape within the Fuel Cell Industry 346.2 Early Markets for Fuel Cells 356.3 Fuel Cell Vehicle Market Introductions 366.4 Outlook from Experts- Summary 377 Conclusions 38

1 Fuel Cell Industry & Patent Overview May 2015


1 IntroductionFuel Cells are electrochemical devices that produce electricity by using a hydrogen-containing fuel and an oxidant, typically oxygen. The principal emission is water. Fuels cells are able to produce power at high-effi ciencies and with limited harmful emissions. A typical hydrogen-oxygen fuel cell emits water as the waste product.

The fuel cell was fi rst invented in 1839. The fi rst commercial interest began in the mid 20th Century with NASA using fuel cells to provide on-board power for manned space fl ight. Ever since, there has been interest in fuel cells for mobile applications, for example for use in automobiles and for providing stationary power. Today the industry is complex with many diff erent companies producing diverse products which use diff erent fuel cell chemistries.

Over the years, the industry has experienced fl uctuating levels of interest in the technology. Fuel cells hold great potential as power providers for a wide range of applications from consumer electronics to stationary power. This report examines the state of recent technological development, in terms of patent activity and academic interest, and provides some case studies of businesses which have commercialised.

The ‘Gartner hype cycle’, as it is commonly known, is used as a tool to plan and position emerging technologies on a timescale and to make recommendations about the timing of strategic investments in technology. The basic dynamics of the hype cycle involves fi ve stages: 1. the technology trigger, 2. the peak of infl ated expectations, 3. the trough of disillusionment, 4. the slope of enlightenment and 5. the plateau of productivity. In this report, we will also be looking to see where fuel cells are in relation to the hype cycle. Academic research by Sjoerd Bakker suggests that fuel cells were at the peak of infl ated expectations between 2002-2006. According to the Gartner market research fi rm fuel cells were emerging out of the trough of disillusionment in 2011, and they were looking towards reaching the slope of enlightenment and eventually the plateau of productivity.

Figure 1.1: Hype Cycle Schematic

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2Fuel Cell Industry & Patent Overview May 2015


This report includes an overview of manufacturers and system integrators and shows a breakdown of fuel cells by country, by continent and by fuel cell type. Up-to-date patent data is then presented. This data updates and augments that presented in the previous reviews (for example, Fuel Cell Today Patent Review 2012) and takes the data to the end of 2014, providing, we believe, the most comprehensive review of patent activity in the fuel cell arena. Subsequently, Academic Research tends are presented, to show that state of play in academic research as a comparison to the patent data. In section 5 two in-depth case studies of fuel cell companies are presented, these companies are SFC Energy and Bloom Energy, these companies were selected due to their relative success within the sector, and their ability to identify markets with real demand for fuel cell systems. Finally in order to get more context of the situation, seven people who can be considered experts in fuel cells were interviewed in order to get their insights into the sector, these findings are presented in section 6.

In summary, this report reviews fuel cell patent activity, academic interest, case studies of commercial businesses and comments by acknowledged experts.



1.1 Methods

To establish a list of fuel cell companies, multiple references were used. News articles, industrial reviews, international programmes, company websites and company registrars such as Companies House were used to build a complete picture of the company portfolios. This information is as accurate as was possible at the time of publication.

With regards to patent analysis, all patent applications are classified by their technology type according to an International classification system – the IPC system1. Fuel cells are classified in H01M8*,23 and we have used that IPC classification symbol to isolate fuel cell patent data.

To derive the data presented below we have interrogated PatentScope, which is accessed via the World Intellectual Property Office (WIPO), Global Patent Index, which is accessed via the European Patent Office (EPO) and is based on their bibliographic worldwide patent database collection and worldwide legal status database, together with other corroborating sources as identified in the text.

In contrast to previous reviews we have not truncated our search results to look only at patent applications at the European patent Office (EPO) and US Patent & Trademark Office (USPTO) but rather have investigated the position globally and across the Big 5 Patent Office group of China (State Intellectual Property Office – SIPO), Republic of Korea (Korean Intellectual Property Office – KIPO), Japan (Japan Patent Office – JPO), EPO and USPTO.

The World Intellectual Property Organization (WIPO) administers the Patent Cooperation Treaty (PCT), an international system which allows patent applicants to file a single patent application which covers ca. 150 territories worldwide. Although patents are granted nationally, the PCT is an increasingly important system for the filing of patent applications and is included in the data, as indicated.

Information on the number of academic research publications was obtained from Google Scholar. Google Scholar allows for reviewing the presence of search terms, e.g. fuel cells, in titles and/or abstracts of academic papers. Comparisons of acronyms alone, full names of fuel cell types and combinations of acronym and full names were tested. Full names were chosen as this showed the most realistic comparison of numbers. A note on polymer electrolyte fuel cells: due to the naming convention around PEFCs, which are often referred as PEM fuel cells, there are circumstances where they are not referenced as PEFCs in the literature. This leads to a smaller number of papers being found. The number of papers which discuss proton exchange membrane and/or PEM however, are an order of magnitude higher, as the label itself is applicable to fields outside of fuel cells. Papers with PEMFC referenced are in the same quantity as those with simply SOFC referenced. Therefore it is quite likely that SOFCs and PEM are more closely aligned than this information might initially present. However, the data is still useful for highlighting the trend in scientific academic publications.

For the case studies, two fuel cell companies were selected; Bloom Energy & SFC Energy. The research methods were the same as for the previously collated company data, with financial data taken from company reports as well as some online financial reports. Further information was found in news articles and company websites.

Furthermore, a collection of International academics and Industry experts were individually interviewed. Where relevant their exact responses were used. When similar views were held, a summary of the research findings is presented.

1 http://www.wipo.int/classifications/ipc/en/2 We note that WIPO accords fuel cell technology a wider classification (http://www.wipo.int/classifications/ipc/en/) than simply H01M8* but cross referencing within those classifications identifies patent publications which are not fuel-cell related. Hence we have used the more precise classification symbol than proposed by WIPO.3 http://web2.wipo.int/ipcpub/#viewmode=f&symbol=H01M0008000000&refresh=page

4Fuel Cell Industry & Patent Overview May 2015


2 Fuel Cell Manufacturers and Distributors Table 2.1 shows the companies identified in this review, the type of fuel cell they use and the sector within which they operate. The companies represented here are manufacturers and distributors of fuel cells.

Table 2.1: List of Global Fuel Cell Manufacturers.

Name Country Fuel cell type Company Sector ACAL energy Ltd UK PEFC Fuel Cells Acumetrics USA (HQ) SOFC Portable power AFC Energy UK AFC Fuel Cells Altergy Systems USA PEFC Fuel Cells

AMI (Ultraelectronics) USA (HQ), UK, Canada, Australia SOFC

Defence, aerospace, security, transport, energy

Aquafairy (partnered with Rohm) Japan PEFC Fuel cells (Rohm are electronics)

Areva (Helion Fuel cells are subsidiary) France PEFC Energy Storage

Asahi Glass Japan SOFC Glass & Ceramics

Asian Pacific Fuel Cell Technologies Ltd Taiwan(HQ), USA PEFC Fuel Cells

Axane (Air liquid subsidiary) France PEFC Fuel Cells

Ballard Power Systems Canada PEFC & DMFC Fuel Cells

BalticFuelCells GmbH Germany PEFC & DMFC Fuel Cells

Bloom Energy USA SOFC Fuel Cells CEKAtec AG Switzerland PEFC Fuel Cells CellEra Israel PEFC Fuel Cells Cellkraft AB Sweden PEFC Fuel Cells Cera-FC South Korea SOFC Fuel Cells Ceres power UK (HQ), Japan SOFC Fuel Cells Comm Energie Atomique France PEFC Energy Research

Daimler AG Germany/USA PEFC Automotive

Delphi UK (HQ), USA SOFC Automotive

Doosan Heavy Industry (Doosan Fuel Cells America inc. and Fuel Cell Power)

South Korea (HQ), America

PEFC & PAFC

Heavy industries, engineering and constructions

Elcogen Oy Finland SOFC Fuel Cells Elcore Germany PEFC Fuel Cells



Name Country Fuel cell type Company Sector Electro Power System Italy (HQ), USA PEFC Fuel Cells

Elring Klinger AG Germany SOFC, PEFC, DMFC

Automotive

Enymotion GmbH Germany DMFC Fuel Cells eZelleron GmbH Germany SOFC Fuel Cells First Element Energy USA DMFC Fuel Cells

Ford Motor Company USA PEFC Automotive

Foresight Energy co. ltd China PEFC Fuel Cells Forschungszentrum Jülich GmbH Germany SOFC & HT-

PEFC R & D Institute

Fraunhofer-Institute Germany PEFC & HT-PEFC R & D Institute

Fronius GmbH Austria PEFC Energy, Batteries, Welding

Fuel Cell Energy USA (HQ), Korea(POSCO) MCFC Fuel Cells

Fuji Electric Japan PAFC Electronics Fujikura Japan DMFC Electronics

GE (General Electric) Fuel cells USA (HQ), International SOFC

Conglomerate (energy, electric, healthcare etc)

GenCell Israel PEFC Fuel Cells

General Motors USA PEFC Automotive

GenPORT Italy PEFC (possibly DMFC)

Fuel Cells

GS Caltex (GS Fuel Cell is subsidiary) South Korea PEFC Oil

Hexis AG (Sulzer) Switzerland (HQ), Germany SOFC Fuel Cells

HIAT GmbH, Germany PEFC & DMFC R & D Institute

Hitachi Japan DMFC, PEFC Electronics

Honda Motors Co., Ltd. Japan PEFC Automotive

Horizon fuel cells Singapore PEFC Fuel Cells

Hydrogen South Africa Systems (HySA Systems) South Africa PEFC R & D Institute

Hydrogenics Canada PEFC Fuel Cells

Hyosung Power & Industrial Systems South Korea PEFC Power and

industrial systems

Hyteon Canada PEFC Domestic heating


hgf.combluevineconsultants.com 6

Name Country Fuel cell type Company Sector

Hyundai Motor Company South Korea PEFC Automotive

In�nitium Fuel Cell Systems, Inc. USA PEFC Fuel Cells Intelligent energy UK PEFC Fuel Cells

IRD A/S Denmark (HQ), USA

PEFC & DMFC Fuel Cells

Johnson Matthey UK PEFC Specialty Chemicals

JX Nippon Japan PEFC Energy

Kia Motors South Korea PEFC Automotive

Kyocera Japan SOFC Ceramics

LG Fuel cell systems? South Korea (HQ), USA, UK SOFC Electronics

Materials & System Research USA SOFC Fuel Cells M-Field Taiwan PEFC Fuel Cells Mico (KoMiCo) South Korea SOFC Ceramics

Mitsubishi Heavy power systems Japan SOFC, MOLB, PEFC

Heavy industries, engineering and constructions

Murata Manufacturing Japan SOFC electronics myFC AB Sweden PEFC Fuel Cells Neah Power Systems USA PEFC Fuel Cells Nedstack Netherlands PEFC Fuel Cells New Enerday Germany SOFC Fuel Cells

NEXT ENERGY EWE Germany PEFC (possibly also AFC)

Fuel Cells

Nextech Materials USA SOFC Fuel Cells

Nissan Motors Co., Ltd. Japan PEFC Automotive

NMITE Ningbo Materials Institute of Technology and Engineering China SOFC I R & D Institute

Nuvera fuel cells USA (HQ), Italy PEFC Fuel Cells Oorja Fuel cells USA DMFC Fuel Cells

Panasonic Japan PEFC, DMFC Electronics

Paxitech France PEFC Fuel Cells

Pearl Hydrogen Technology Co. ltd

China PEFC Fuel Cells

Powercell AB Sweden PEFC Fuel Cells Proton Motor Fuel Cell GmbH Germany PEFC Fuel Cells

Protonex USA PEFC & SOFC Fuel Cells



Name Country Fuel cell type Company Sector Redox Power Systems USA SOFC Fuel Cells ReliOn Inc (part of Plug Power Inc) USA PEFC Fuel Cells

Riesaer Brennstoffzellentechnik RBZ GmbH Germany PEFC Institute

Saint-Gobain Corporation France (HQ) SOFC Ceramics

Samsung South Korea DMFC, PEFC, HT-PEFC Electronics

Serenergy A/S Denmark HT-PEFC Fuel Cells SFC Energy AG Germany DMFC Fuel Cells Shanghai Shen-Li High Tech Co. ltd China PEFC & HT-

PEFC Fuel Cells

Siemens Germany SOFC, MCFC Electronics Société Bic France PEFC Consumer Products SOFCpower Italy SOFC Fuel Cells SolidCell USA SOFC Fuel Cells Sony Japan DMFC Electronics Sumitomo Precision Products Japan SOFC Aerospace Sunfire GmbH Germany SOFC Fuel Cells Sunrise Power China PEFC Fuel Cells

Suzuki Motor Corporation Japan PEFC Automotive

SymbioFCell France PEFC Fuel Cells

The Institute of Engineering Thermodynamics at the German Aerospace Centre (DLR)

Germany PEFC & SOFC Institute

TMI USA SOFC Fuel Cells Toshiba Fuel Cell Power Systems Japan PEFC Electronics TOTO Japan SOFC Ceramics

Toyota Japan PEFC Automotive

Truma Gerätetechnik GmbH & Co. KG Germany HT-PEFC Recreational

vehicle products

Ulmer Brennstoffzellen Manufaktur GmbH Germany PEFC Fuel Cells

Ultracell (Brentronics) USA PEFC Military equipment Versa Power (and Owners) Canada SOFC Fuel Cells Watt Fuel Cell USA SOFC Fuel Cells ZSW (Centre for solar Energy and Hydrogen Research Baden-Württemberg )

Germany PEFC & DMFC R & D Institute



2.1 Geographic Distribution

Germany, the USA and Japan have the most significant presence in the fuel cell sector (Figure 2.1). In the case of the USA and Germany many of these are fuel cell companies, and work on almost every fuel cell type available. Whilst Japan has fewer companies involved than either the USA or Germany, many of the Japanese companies involved in this field are internationally recognised electronics and ceramics companies, for example Panasonic. A number of European nations, and countries like Canada and China have between 4 and 6 companies involved in fuel cells. Despite these countries having a small number of companies, some are very prominent players such as Canada-based Ballard Power Systems and Intelligent Energy from the United Kingdom.

Globally, there are more fuel cell companies in Europe than on any other continent (Figure 2.2), with Asia and North America both having 25 companies. Most of South America, Africa and Oceania appear to have little in the way of industrial involvement in the fuel cell sector. South Africa and Australia both have 1 active fuel cell company each. However it should be noted that the Australian company is currently going through administration and so its future is uncertain. This is despite both regions seeing some market demand for fuel cells. This can especially be seen for stationary power generation in areas with regular black-outs and for telecommunications.

Figure 2.1: Fuel Cell Distributors and Manufacturers by country in descending order.

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Figure 2.1: Fuel Cell Distributors and Manufacturers by country in ascending order.

Figure 2.2: Global Distribution of fuel cell manufacturers by continent

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2.2 Fuel Cell Manufacturers by Fuel Cell Type

Figure 2.3 shows a breakdown of which fuel cell types companies are working on. In the case where a company works on more than one type of fuel cell they are represented in each fuel cell type. Unsurprisingly, over half the field is represented by PEFC companies (inclusive of High Temperature PEFC companies). SOFC represents a third of the industry, with the rest being filled by the smaller (but not necessarily less successful) alternative electrolyte systems.

Figure 2.3: Fuel Cell Manufacturers broken down into fuel cell type

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PEFC SOFC DMFC PAFC AFC MCFC

Figure 2.3: Fuel Cell Manufacturers broken down into fuel cell type

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PEFC SOFC DMFC PAFC AFC MCFC



3 Patent Analysis

3.1 Setting the Scene

To help to quantify patent activity in the fuel cell arena we first present data showing overall patent activity for the years 2005 to 2014.

Patent applications are typically published eighteen months after filing, which means that the publication data provides an indication of the patent application filing position, albeit with an 18 month lag4.

Publication under the PCT system also occurs eighteen months after the first filing date of a patent application for an invention.

Figure 3.1 shows an overall increase in the annual publication of patent applications (blue bar), rising from just over 1.5 million in 2005 to over 2 million in 2014. Similarly, the number of published PCT applications (red line) rises from just over 150,000 in 2005 to over 200,000 in 2014. The increase in the numbers of patent applications shows no hint of slowing down and we would expect the rate of filing (and hence publication) to maintain its current pace.

The important features to note are that patent publications, and hence patent filings are increasing year-on-year (the slight dip in 2010 corresponding to a dip in patent filings 18 months prior to that) and that the figures indicate that in 2014 the PCT route was a more preferred than it was in 2005. The ratio between all publications and PCT applications appears to have increased up to about 10:1 in 2014, from 12.2:1 in 2005.

4 Some applications are undoubtedly abandoned between filing and publication. However, those applications are not classified and the subject matter does not reach the public domain through the patent literature.

Figure 3.1: Published patent applications for the years 2005 to 2014.

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The most important patent offices around the world are those of China, Japan, USA, Europe and Republic of Korea, the so-called ‘Big 5 Patent Offices’. The publication data relating to patent applications at each of those offices is shown in Figure 3.2.

The most notable changes are the huge increase in publications at the Chinese office (+380%) and the large decrease at the Japanese Patent Office (-25%). The numbers of applications published at each of the USPTO, EPO and KIPO has increased, with the EPO showing the largest marginal growth (ca. +13%) but the USPTO now outstripping the JPO in terms of the absolute number of published applications.

In contrast to previous reviews, we prefer to use patent applications as published, rather than the number of patents granted as the most appropriate metric of R&D activity. This is because the filing of a patent application is the first public acknowledgement that an invention may have taken place and filing is independent of down-stream issues for the applicant and at the respective patent office and, importantly, because the number of patents granted in any particular year is substantially lagged as compared to when the research activity actually took place. The time it takes for a patent to be granted depends on how the applicant chooses to prosecute the application and on the pendency time at each patent office.

Figure 3.2: Published patent applications for the years 2005, 2009, 2014 at the Big 5 Patent O�ces

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The pendency time is dependent upon several factors, including the underlying law (there is no universal patent law), the activity in any particular sector and the productivity of the patent examiners in that particular sector in dealing with the applications which they are asked to examine. The pendency statistics for each of the Big 5 Patent Offices are shown below (Figure 3.3).

Figure 3.3: Patent pendency data at the Big 5 Patent Offices4

4 Source WIPO - World Intellectual Property Indicators, WIPO Statistics Database 2014.

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Taking the mode of the pendency time for patents granted in each of two time periods (from 2000-2002 and from 2010-2012) as a guide to overall pendency at the Big 5 Patent Offices, the data indicates that the Chinese and Japanese Patent Offices have significantly reduced pendency times, whereas Europe and Korea have shown a small improvement over time and pendency at the USPTO has increased. Given the apparent reduction in filings at the JPO and increase at the USPTO these figures are, perhaps, less surprising. Of note though is the performance of the Chinese Patent Office which appears to have reduced pendency times by about 2-3 years against a backdrop of greatly increased filings. It is of note that the JPO pendency statistics appear to be moving towards a distribution more akin to those of the other patent offices, possibly due to the change in Japanese law which reduced the deadline for filing a request for examination, thereby truncating the patent grant procedure, especially for foreign (PCT-route) patent applications.

In Summary:

The number of patent applications has risen year-on-year between 2005 and 2013 when measured both in terms of the total world-wide published applications and those pursued via the PCT route. Of the major patent offices around the world, China is the stand-out growth territory. We believe that this is due to the increased use of the patent system by Chinese nationals as well as applications filed by foreign companies. In contrast to China, the patent activity at the Japanese Patent Office appears to have significantly reduced over the same period. In the other three territories (EPO, KIPO, USPTO), there has been growth, albeit at a more modest rate than in China.



3.2 Fuel Cell Patent Activity3.2.1 Filing Statistics

In Figure 3.4 and Figure 3.5 we show the annual publication data for fuel cell patent applications as compared to total patent application publication data.

Figure 3.4: Published total patent applications vs. published fuel cell patent applications for 2005 to 2014.

In terms of the number of published fuel cell patent applications there is a marked decline in the number of publications since the high point in 2007 from over 10,000 to under 5000, a -55% decline.

We note that this conclusion is in stark contrast to that provided in the 2012 Fuel Cell Patent Review presented by Fuel Cell Today5. We can only surmise that the reduced data set used in that report as compared to the data presented herein has led to the different conclusions. We note that our data is consistent with that presented by WIPO6 and so we conclude that worldwide patent activity in the fuel cell space has dramatically decreased since 2009, and shows no signs of increasing.

6 httpL//www.fuelcelltoday.com/analysis/patents/2012/2012-fuel-cell-patent-review7 WIPO - World Intellectual Property Indicators, WIPO Statistics Database 2014 pp34.

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Figure 3.5: Published PCT fuel cell publications for 2005 to 2014

The data of Figure 3.5 (in comparison with the data of Figure 3.4) shows that the PCT route is increasingly favoured by fuel cell patent application filers. For example, in 2008 the ratio of total fuel publications to PCT fuel cell publications was around 10:1, whereas by 2014 that ratio was around 5:1.

For the period 2010 to 2104 the trend of PCT fuel cell publications is upwards, in contrast to the trend in total fuel cell patent publications (which is downwards). Indeed, although the overall filing statistics show a decline in fuel cell applications the decline is less stark in fuel cell PCT publications as compared to total publications of patent applications for the years 2005 to 2014 when calculated as a function of the overall publication statistics (-67% for (Fuel Cell: Total) as compared to -43% (Fuel Cell: PCT)).

With regards to the geographical split of filings, the patent application publication data in the Big 5 Patent Offices is shown in Figure 3.6.

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Figure 3.6: Published fuel cell patent applications for the years 2005, 2009, 2014 at the Big 5 Patent Offices.

As expected from the overall fuel cell patent publication data (Figure 4), the overall publication statistics across the Big 5 Offices shows a marked decline, with publications at the JPO showing the absolute largest decline (57%), but a marginal decline of 40% as a function of the total publications for the same period (that is publications of fuel cell patent applications as a function of total patent publications). By contrast, the position in USA is an absolute decline of 46% and a marginal decline of 50%. This indicates that although filing statistics as a whole are down for fuel cell patent applications, the position in Japan is marginally more robust than in USA, for example.

The publication data for fuel cell application is shown again in Figure 3.7.

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Figure 3.7: Published fuel cell patent applications for the Big 5 Offices for 2005 to 2013.

Notwithstanding the increased growth in total patent publications at each of SIPO, EPO, KIPO, USPTO, publications of fuel cell patent applications shows a decline for the period 2005 to 2013 at all five patent offices. Published fuel cell applications in USPTO and EPO have shown a steady decline whereas the position in Korea and China rallied in 2009 and then appeared to markedly decline to 2013.The absolute and marginal7 decreases in publications of fuel cell patent applications are shown in Table 3.1 for the period 2005 to 2013.

Table 3.1: Decline in publications of fuel cell patent applications at the Big 5 Patent Offices 2005 - 2013.

7 The marginal decrease is calculated as the amount of decrease in fuel cell patent activity as compared to overall patent activity.

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The data demonstrates that there is both an absolute and marginal decline in the number of fuel cell applications which are being published at each of the Big 5 Patent Offices. This demonstrates that filers of patent applications for fuel cell technology are not keeping pace with the overall position and, moreover that the marginal decline is not uniform across the Big 5 Offices, demonstrating that Europe and Japan appear to be more preferred as filing destinations (as compared to technology overall) for fuel cell technology than China and USA.

The year-by-year data is shown in Figure 3.8.

Figure 3.8: Annual publications of fuel cell patent applications.

The data from Figure 3.5 is shown in Figure 3.8 divided according to the publication territory. Interestingly, publications for those patent offices not counted as part of the Big 5 Offices appear to be relatively stable over time. There is also evidence that the publication data for JPO shows an increase from 2012 to 2013.

In Summary

The overall annual number of publications of fuel cell patent applications has decreased and shows no sign of increasing to the record highs of 2007/2008. This is in stark contrast to the overall patent filing statistics which continue to show robust growth across the world (with the notable exception of Japan). The latest available data for Japan may show signs of a recovery in the absolute number of fuel cell patent applications and publications, although it is too early to confirm if this is a real or a transient effect. That said, the marginal decrease in fuel cell applications in Japan is less stark than in the rest of the world indicating that Japan is likely to remain the single most important territory for fuel cell patent applications.

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3.2.2 Granted Fuel Cell Patents

As was stated above, the number of patents granted is not an effective metric for determining the growth or development of fuel cell technology because grant of patents is, at least in part, at the behest of the local examiners and the law under which they operate. Nevertheless we present data below for the number of granted fuel cell patents.

Figure 3.9 shows the annual number of granted patents for the Big 5 Patent Offices.

Figure 3.9: Granted fuel cell patents for the Big 5 Patent Offices 2010 – 2014

The data shows that the JPO is by far and away the most significant authority for granting patents in the fuel cell space with the position in the USA remaining stable over time and the SIPO and KIPO showing marginal increases in the number of granted patents.

Given that the number of applications filed and published in each office is reducing we would expect patent pendency in fuel cell technology to decrease ahead of patent pendency in other higher growth technology areas.

The position for the rest of the world appears to remain fairly constant over time.

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Figure 3.10: Granted patents for the Big 5 Patent Offices 2010 to 2014

The data confirms that there is a slight increase in the number of patents being granted in fuel cell technology between 2010 and 2014 but that a peak was reached in 2012, perhaps indicating that there will be a continuing decline in the number of patents granted. The number of patents granted by Patent Offices other than those in the Big 5 group appears to have decreased over the period.

In Summary

The number of patents granted annually around the world has remained in excess of 5000 since 2010. Given the decrease in filing numbers and the decrease in pendency times we would expect to see some stability in the number of patents being granted but with a trend downwards over time. It is clear that Japan remains the single most important territory for granting fuel cell patents. This means that any business wishing to commercialise their fuel cell technology world-wide must continue to consider their patent position in Japan.

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3.2.3 Assignee Data

Patent Filers

The data presented below (Figure 3.11, Figure 3.12 & Figure 3.13) shows the top ten filers of patent applications in the fuel cell space for 2010, 2012 and 2014.

Figure 3.11: Top ten filers of fuel cell patent applications in 2010.

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In each case the bar shows the absolute number of patent applications filed by a particular entity and the line shows the proportion of those applications which were filed as PCT applications.

As expected, the lists are dominated by Japanese corporations with Korean (Samsung and Hyundai), US (General Motors) and European (Daimler) corporations making up the remainder of the number.

In each of the three years Toyota, Honda and Panasonic make up the top three, in each of the three years filing well in excess of 200 patent applications each. These businesses are by far and away the most active in the fuel cell arena, confirming their continued enthusiasm for fuel cell technology.

The proportion of the filed applications being filed as PCT application is not uniform, indicating that different patent filing strategies are being deployed by each company. Toyota and Nissan, for example, appear to be increasing the proportion of their patent applications which are filed as PCT applications (6% to 10% to 12% and 6% to 21% to 35% respectively) whereas Honda appears to have a relatively stable rate of PCT applications (ca 5%) and General Motors, Hyundai and Samsung appear to make little use of the PCT route for fuel cell technology inventions.

Notwithstanding that the PCT route is not uniformly deployed by fuel cell patent filers we present below the country of residence for PCT patent applications on a year-by-year basis.



Figure 3.14: Top 10 countries of residence for fuel cell PCT applications 2005 to 2014.

This data (Figure 3.14) accords with the presented in Figure 3.5, demonstrating that there is little patent filing activity for PCT patent applications in the fuel cell space outside of the top ten filing countries.

It is of no surprise given the graphs presented above that Japan, USA and Germany dominate the PCT patent filing statistics. However, it should be noted that the position with regards to Japan is likely to be understated, due to the relatively low take-up of the PCT route by some of the major Japanese companies filing in the fuel cell space (see Figure 3.13). It is also interesting to note that although Samsung is one of the top ten patent filers in 2012 this is not indicated in the Korean country statistics due to Samsung’s relative lack of use of the PCT route.

In Summary:

The filing data is dominated by three large Japanese corporations. However, the rate and number of patent filings even for those businesses has nose-dived in the period 2010-2014. The filing statistics for Toyota, for example, show a decrease from 1468 (2010) to 309 (2014), the reduction of patent filings from Honda being less marked at 477 to 320 over the same period.

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Granted Patents

We present the data for the assignees of granted patents for the European and US Patent Offices below (Figure 3.15, Figure 3.16 & Figure 3.17).

Figure 3.15: Top ten assignees of US and EP fuel cell patents 2010


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Perhaps as expected, Toyota and Honda feature highly on the list of assignees of granted patents but the list also includes several players not otherwise mentioned. As stated above this could be a function of the time it takes for patents to be granted in the USA and is unlikely to be because of businesses not wanting to utilise the US patent system.

Whilst Toyota and Honda continue to obtain significant numbers of granted patents, it is noted that both businesses are continuing with their strategy of endorsing at least a proportion of their fuel cell patents as licence of right9 in the UK, at least.10

Clearly the patent landscape in Europe and USA is likely to be highly diverse with many significant players, meaning that businesses wishing to deploy their technology would be wise to conduct full and rigorous freedom to operate analyses prior to commercialisation.

In summary:

The annual number of granted fuel cell patents issued by the EPO and USPTO remains high, with Japanese and Korean businesses dominating the list of businesses being awarded patents. Whilst patents can be used to stop competing activity there appears to be an increasing number of patents which are endorsed licence as of right which may well present opportunities for other businesses to access fuel cell patents at a fraction of the cost than might otherwise be the case, notwithstanding the announcements earlier this year by Toyota.

9 A patent endorsed licence of right attracts a reduction in the annual renewal fee in exchange for the patentee agreeing to licence the technology to whoever asks for such a licence.10 In the past six months 15 separate patents have been so-marked by either Toyota or Honda (see https://www.ipo.gov.uk/p-dl-licenceofright.htm for details).

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4 Academic Research TrendsThe number of papers published over the last decade has been progressively increasing year on year, with Solid Oxide Fuel Cells, Direct Methanol Fuel Cells and Polymer Electrolyte Fuel Cells being the most prominent. The number of papers on Direct Methanol Fuel Cells had significantly increased in and around 2007. This has subsequently reached a plateau but nonetheless highlights the interest that this particular branch of fuel cells has received. The less prominent fuel cell types such as Molten Carbonate, Alkaline and Phosphoric Acid, have seen less published research. Given that these fuel cell types are more mature than SOFCs or PEFCs commercially this isn’t surprising.

SOFCs have long been the most widely researched fuel cell type according to this data. This is likely due to the technology being relatively young. DMFCs overtook PEFCs in 2004 and became the second most published fuel cell type with research peaking in 2007, since then publications in this area have been falling. In 2011 the number of PEFC publications overtook DMFC and today they are the second most researched fuel cell type in terms of number of publications.

Figure 4.1: Growth in the number of publications published yearly, broken down into the different types of fuel cells being researched.

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5 Company Case Studies5.1 Bloom Energy

Currently, Bloom Energy sells a range of stationary power generation products, which are collectively called the “Bloom Energy Server”. This SOFC based FC system operates at 980oC and can be run on a variety of different fuel types. The smallest Bloom Energy Server is a 100 kW system that was reported to cost between $700-800K (ca. €550,000 to €620,000). In addition to the 100 kW unit, Bloom produces 160 kW and 200 kW energy servers.

Thus far, the majority of the customers have purchased the Bloom Energy Server mainly due to its ability to provide uninterruptable power. In 2007 (the last year such information is publically available), the US had 240 minutes of grid black-out which cost an estimated $100bn (€87 billion). The US gas grid, which the Energy Servers utilise, has a close to 100% reliability. This allows users to capitalise on the benefits of Fuel cells. For example, eBay installed 500 kW of Bloom Energy Server and a further 6 MW at their Salt Lake City (Utah) data centre site. Indeed, their data centre was the first in the world to use a FC system as the primary power source with the standard electricity grid as the backup. For eBay, alongside uninterruptable power, the following added values are also enjoyed:

1. Meet their targets of carbon emission reduction2. Reduce their energy usage 3. Reduce the cost of purchasing and maintaining costly generators and UPS components.4. Promote themselves as a green corporation.

The added values of the Bloom Energy Server are therefore attractive to large corporations, especially in the USA, where power outages are a common event and can last between 90 to 240 minutes. Corporations cannot afford to be out of power as revenue will be lost. The importance of maintaining website operation 100% of the time is demonstrated by the case of Amazon.com. In 2013 the website went down for 15-40 minutes, during this time Amazon is estimated to have lost $1-2.5million (€0.87-2.18 million) in sales alone. Further to this their share price fell by ca. 10%. As a result, this situation highlights the benefits and added value of a FC system that operates independently of the main power grid and can maintain power 100% of the time.

Bloom Energy’s success in this market is partly due to support from the national and state incentives. In 2010 alone Bloom Energy and its clients received over $200 million (€175 million) in subsidies from the California Self-Generation Program (SGIP). There are several levels of support on offer from the SGIP, which also varies by system. FC based generation systems receive a flat rate of $1.65/W (€1.43/W) in subsidy as long as the amount of power generated is below 1MW. Between 1-2MW and 2-3MW, the owner of the FC will realise $0.83/W (€0.72/W) and $0.41/W (€0.36/W), respectively. For example, a 100 kW Bloom Energy Server running on natural gas would receive a subsidy of $165,000 (€143,000) off its purchase price. For systems above 30 kW, 50% of this subsidy would be paid upfront which would significantly help with installation costs. This means that it is in fact possible to get a significant return on investment in 5 years from installation. If run on biogas the subsidies can rise to $8.25/W (€7.20/W).



A comparison of the Bloom Energy Server to a diesel and battery system can be seen in Table 5. A comparable diesel generator would cost approximately $20,000 (€17,500) and a battery based UPS that could provide 50 kW of power would cost approximately $42,000 (€36,000). Typically in data centres a hybrid system comprising of both a battery system and diesel generators is used. The batteries are used for immediate power supply when a power outage occurs. The diesel generators are then used for the remainder of the power outage. A diesel and battery system would be lower in cost. Despite these lower costs, the Bloom Energy servers are often still preferred due to longer run times, less noise and less CO2 emissions.

Table 5.1: The Bloom Energy Server compared to a Diesel and Battery back-up power unit.

5.1.1 Bloom Energy- Summary

Prior to using Bloom Energy Servers, companies like eBay can be considered to be non-consumers, because their needs were not being properly met. Prior to using Energy Servers, eBay along with many other companies used a back-up power system comprising of batteries and large diesel ICE generators. These systems were the only back-up power solution available to the companies, but were not truly fit for purpose. They did indeed supply back-up power to the companies, but this was in an undesirable package; the systems were capital intensive, underutilised, maintenance intensive, polluting, noisy and had a high risk of failure. An Energy Server can be used 100% of the time, requires less maintenance, has zero tailpipe emissions, is quiet, helps towards giving large corporations a ‘green’ image and benefits from subsidies from government organisations in the US.

Diesel ICE Battery Bloom Energy Server

Purchase Price $20,000 $42,000 $700,000

Max Nominal Power

100 kW 50 kW 100 kW

Noise 96 db - 70 db

Run time c. 8 hours 6.4 mins Continuous

CO2 emissions 675 kg CO 2/MWh - 386 kg CO 2/MWh



5.2 SFC Energy

SFC Energy is a German based FC company producing energy solutions for consumers, defence and industrial customers. The company was founded in 2000. SFC Energy use DMFCs, which are known for having a high cost which is due to high platinum loadings and also because of specialised materials that are used, for example the Nafi on membrane. The company mainly concentrates on low power fuel cells typically between 25W-100W, therefore keeping overall costs relevantly low. Historically, joint development agreements, defence clients and the consumer sector have been important sources of revenue for SFC Energy. More recently there has been a shift towards industrial clients. SFC Energy had previously been looking to incorporate some of their products into electric mobility in the form of on-board range extenders or battery chargers and hybrid drive trains specifi cally for light electric vehicles. However, they are no longer interested in this market.

One important market that SFC Energy has always targeted and that has remained a signifi cant source of revenue is the Recreational Vehicle (RV), Motorhome and Caravan market. This was one of SFCs fi rst commercially successful markets. SFC Energy has also concentrated on traffi c management systems, monitoring, security systems and off -grid power; these markets are now important sources of revenue for SFC Energy. In 2011, industrial sales overtook declining sales to the consumer segment (Figure 5.1). Today the most important market for SFC Energy is the industrial segment with 77.1 % of revenue coming from this sector. 14.7 % comes from the Consumer market and 8.2 % is from the Defence and Security sectors.

Figure 5.1: Revenue generation by market sector and total yearly revenue. Sales in the defence and industry sectors did occur before 2008 and 2009 but no data is available in SFC Energy reports.

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By the end of Q4 2012 SFC Energy had reached sales volumes of 24,000 FC units worldwide. Today this figure is over 30,000. In 2014, SFC Energy generated €53,613,000 in revenue (Figure 5.1), of which €4,100,000 was from consumer sales of fuel cells. The cost per kilowatt for the consumer FC units is very high at approximately €50,000 /kW. As of 2015, the 105 Wel EFOY COMFORT units cost €5,000. Sales are mainly to the RV market, with a smaller number of units also being installed in yachts and stationary cabins. SFC Energy has won over 26 awards for innovation, product design and enterprise. By 2008, 37 European manufacturers of motorhomes offered EFOY fuel cells as a standard or optional extra. In general, the majority of SFC Energy’s customers are in Europe; with 60.3% of revenue coming from this market, with 31% from North American customers. The remainder is from the rest of the world, but primarily Asia (5%). In 2013 industrial sales made up €24,969,000 (€33,079,000 Q1-Q3 2014) of revenue, making it the largest market sector. The growth has been partly attributed to growth in the Oil and Gas sector and in Traffic Technology, and has been achieved partly by the acquisition of Canadian distribution company, Simark.

5.2.1 SFC Energy- Key Markets

SFC Energy currently sells a range of products to a number of markets. The main product in the consumer market is their EFOY COMFORT FC power unit. The unit was originally only marketed to motorhome and caravan users. However, recently marketing towards yacht users has increased where the challenges for power provision are similar to motorhomes. In 2013, EFOY began selling fuel cartridges in the Caribbean in order to increase fuel access to users in this region. A number of yacht companies including Marex Boats and Leonardo Yachts install EFOY COMFORT’s as factory fitted options on their boats. In 2013, SFC Energy sold 1697 units of the EFOY Comfort; this is far lower than the peak year in 2008 when they achieved 4210 unit sales.

SFC Energy has packaged a unique combination of added values into the COMFORT and has sold these to a market where consumers desire these values. Importantly, in these markets, alternative solutions do not exist. This means that the COMFORT allows consumers to do things that were previously not possible. In Motorhomes and RVs the COMFORT serves as a replacement for a leisure battery or a diesel ICE generator. In many US and Canadian national parks, ICE generators are banned or their use is highly restricted. This is also the case in some Australian National Parks. In these scenarios, the EFOY COMFORT offers a quiet and environmentally benign way to generate power. The unit is significantly more expensive than comparable battery or ICE but consumers are willing to pay this in order to access the benefits of the technology. The EFOY COMFORT is not without compromise.

SFC Energy markets its EFOY PRO range of products to industrial customers specifically for the monitoring of remote terminals in the oil and gas industry. SFC Energy list Canada as an important market as it has 175,000 gas wells and 125,000 oil wells currently in operation. In this sector, fuel cells are used for pumps, monitoring, the transmission of data and pipeline security monitoring. EFOY PRO’s are also used in wind farm monitoring, telecommunications back-up and continuous power, mobile and stationary surveillance, environmental data measurement and traffic management systems in off grid locations. In order to break into the North American market, SFC Energy acquired Simark who specialise in the distribution, service, supply and product integration for power products to the Canadian oil and gas industry. This market has been a significant source of growth for SFC Energy (Figure 5.1) and will hopefully lead to continual increases in unit sales and revenue in SFCs most important market sector.



SFC Energy has a range of products for Defence and Security applications. The added values that SFC Energy’s products offer in this market arise mainly due to significant weight savings. This market has seen substantial growth in recent years and is the second largest contributor to SFC Energy’s revenue. SFC Energy products offer longer run times, lighter operational weights and quieter operation compared to competitor technology. On vehicles, the EMILY 3000 can be used to power electrical systems when the vehicle is stationary. This means the engine does not need to be idling, thus saving fuel, resulting in longer mission times, and reduced noise and heat signatures.

5.2.2 SFC Energy- Summary

The success of SFC energy has been due to the fact that they have been able to both develop functional fuel cell systems, but also it is thanks to their ability to identify markets with demand for fuel cell products. Indeed some of the markets they have targeted are small, such as the RV and Motorhome market, which may be reaching saturation. Therefore SFC provide important lessons for other players in the industry, they is to develop a functional product that has real market demand. Further to this it is important to identify more than one market where the products will be valued.



6 Fuel Cell Industry - Outlook from ExpertsIn order to gain more insight into the industry beyond quantitative data was gathered by interviewing a number of experts within the field. During the interviews some key trends emerged, these were that the landscape of the industry is changing, where the early markets for fuel cell might be, and the market introduction of fuel cell vehicles, which is occurring now.

6.1 Changing Landscape within the Fuel Cell Industry

The opinion of the experts was that the fuel cell industry has not seen particular growth in number of companies in the last year. In fact experts mentioned the closure Topsoe Fuel Cells, Lilliputain Systems and ClearEdge Power (though its subsequent purchase by Doosan Fuel Cell may make that irrelevant). However, General Electric have returned to the fuel cell field by opening up a plant in Malta NY, where they have a wealth of experience which could see them become strong entrant into the market. Alongside this, interviewees noted a number of supply chains and ancillary fields building up around the fuel cell field. In some cases, Governments are using their procurement power to stimulate the fuel cell supply chain. Nevertheless, many existing fuel cell companies are now looking to consolidate.

With regard to larger companies, the experts believed that they may not wish to ‘cannibalise’ their existing markets through the introduction of fuel cell products, especially when the margins on those existing products are better. This might even be the case with companies who already have a suitable fuel cell product available if they decide to commercialise it. Daimler in particular are mentioned for having been involved In the fuel cell research area for a long time but continuously push their release dates back. However with the future market looking to welcome the advent of the fuel cell vehicles from the likes of Hyundai and Toyota, there may be a shifting point where the balance of companies involved starts to move towards having a hand in this potential market. The presence of larger corporations whose business is not primarily fuel cells was generally seen as positive.

“We are seeing more conventional companies offering fuel cell components, which is good for growth”

Dr. Olivier Bucheli, co-director of the European Fuel Cell Forum



6.2 Early Markets for Fuel Cells

The experts noted that the military market has been an important niche for the development of fuel cell technologies. For a number of years fuel cell companies have seen success in military applications by supplying portable power for soldiers. This weight reduction is highly desired in comparison with multiple batteries and stationary power generation, allowing for cleaner and quieter power generation. Submarines also provide an attractive area for certain fuel cell systems for similar reasons to onsite power generation. Applications like power for ships when pulling into harbours or docks which have restrictions on emissions represent highly attractive niche markets, as are certain recreational markets such as campervans and yachts. Fuel cell forklifts have had a recent surge in the market, with Plug Power having a very successful year in terms of orders.

Ultimately the uptake of certain applications, like micro-CHP is highly dependent on the environment in which they are being offered. For Japan, South Korea and North America, where the risk of power outages or emergencies lead people to place a higher value on the reliability of their network, fuel cell micro-CHPs have added value. However, in Europe, due to the robust nature of the European electricity grid/system, it may take the advent of increased renewables in the market to allow increased possibility for fuel cells to be able to take advantage of the more intermittent nature of the renewables (especially in hydrogen form).

“For Japan, South Korea and North America, where the risk of power outages or emergencies etc. lead people to place a higher value on the reliability of their network, fuel cell micro-CHPs have added value ” Professor Ludger Blum, Forschungszentrum Jülich



6.3 Fuel Cell Vehicle Market Introductions

With the advent of fuel cell vehicles on the horizon, the potential impact on the industry has almost all members of the industry watchful and hesitantly excited for the outcomes. In 1993, Daimler were working on fuel cell cars, and over twenty years on we’ve yet to see a fuel cell vehicle market emerge. With the release Hyundai’s ix35 (also known as the Tuscan) and Toyota’s Mirai planned, there are clearly models being made available. If companies like Ford, Nissan, Renault and Daimler aim to release their vehicles in 2017, there may be a reasonable selection of vehicles available to customers, so there is a belief that FCVs may start to emerge within the automotive sector at large numbers.

However, a common point raised is that even if the market grows at a reasonable pace, the question of how much these vehicles will be sold for, and how much they will cost to manufacture is still highly debated, and some experts believed this may dissuade companies from entering the market. By comparison, the Toyota Prius is often quoted as taking 10 years to become profitable. In Europe, most automotive companies didn’t invest in hybridisation initially, missing out on market share and had to play catch up as a consequence. There is a concern that this may occur with fuel cell vehicle.

Most believed that fuel cell vehicle development is positive. The influence of fuel cell vehicles could have over the potential future deployment of fuel cell products will most likely be significant, as an increase in vehicles will lead to more technological maturity and a greater availability of hydrogen and hopefully at lower costs.

However, experts did have a concern about the lack of hydrogen infrastructure to support vehicle rollouts. To combat these misgivings, Japan, Germany and California have significant plans to get a large number of hydrogen refuelling stations up and running in the next 1-5 years. Furthermore, a number of states are looking to establish refuelling stations to help encourage people to not only feel their vehicles are viable within their own states but also country-wide. An interesting recent development is the announcement from Toyota that they plan to share almost 6000 fuel cell patents. Professor Steinberger-Wilckens believed that this was a risk mitigation strategy.

“Automotive Companies don’t want to be alone in their market” Professor Robert Steinberger-Wilckens, University of Birmingham & PLANET

On the whole experts were hopeful for the fuel cell vehicle markets, however were aware that market growth would be slow and would be significantly dependant upon the growth of a hydrogen infrastructure.



6.4 Outlook from Experts - Summary

Within the industry expectations appear to be high, and there is confidence that fuel cells will start to emerge in more markets globally. Despite the fact that the fuel cell industry has been through a number of peak and troughs, or hype cycles, these experts remain hopeful that fuel cells are finally ready for larger scale market introductions.

“We’ve moved on and have entered into an incredibly exciting time for fuel cells because the societal, political and technological drivers are there to develop and deploy much better than they could 20 years ago”Professor Nigel Brandon OBE FRENG, Imperial College London

“The application will define the winner for fuel cell success, not the fuel cell”Dr. Brian Borglum, Versa Power Systems

“If you look at ENE.FARM, the societal benefits and cultural backing, it makes sense even without subsidies”Professor Nigel Brandon OBE FRENG, Imperial College London



7 ConclusionsFuel cells offer an interesting prospect in these uncertain times where energy security and “greening” of energy supply are of great interest. When assessing the state of the industry it is important to consider many of the contributing factors. Indeed past reports have reviewed the industry in terms of units and kW shipped. This report looks at trends in patent data as well as data showing research trends, and information on active companies.

From our report, it is clear that the fuel cell industry is in an interesting position. On the one hand, there are many companies currently manufacturing and distributing fuel cells, with our research showing more than 100 active companies globally. A majority of the companies are based in the US, Germany and Japan. It is interesting that some of the largest companies in the industry are also those who control large stakes in incumbent technologies, from which they draw most of their profitable business. If some of these companies are to commercialise fuel cells they will need to accept that it may, at the beginning at least, lead to a drop in sales of existing products. A situation that is mirrored within the automotive industry with electric vehicle sales displacing internal combustion engine vehicle sales.

From the patent analysis, it is clear that patent activity within the sector has been in decline since 2008-2010. Reasons for this decline could be that there is innovation saturation within the field, or that this decline is a holdover from the recession. However, it is possible this decline in patent activity is because companies are closer to commercialisation of their products. This is further supported by the increase in scientific journal publications, which have been steadily increasing over the past decade. This indicates that research is on-going, but that it is not yielding new patents. Research may be going into consolidating existing technologies in order to improve on them and make ready for commercialisation.

Whilst patent data does suggest a decline within the industry, there is evidence elsewhere that fuel cells are becoming more mainstream, with many larger companies now investing in the industry. The drivers are in place for the future to be paved with fuel cell products, especially if larger companies and governments can push forward to bring the products to market.

From the two case studies, it is clear that fuel cells can be commercialised, however it is important that the right markets be found for such an endeavour. SFC Energy and Bloom Energy show excellent market penetration, which is based on the added value that the fuel cell has. These companies were able to leverage the unique beneficial attributes of fuel cells and market them to consumers with existing demand.

Fuel cells have been overpromised in the past, in particular with fuel cell vehicle commercialisation being promised far sooner than it could ever realistically be delivered. Though fuel cell vehicles only represent a portion of what fuel cells can offer, they are one of the most high profile applications of fuel cells, certainly from the consumer perspective. Therefore, even if they do not achieve commercial success they will raise the profile of fuel cells among the public, along with yielding significant technological advancements applicable throughout the industry. Alongside these products, companies such as Panasonic and Toshiba, are looking to bring fuel cells into homes through micro-uCHP units.

From this report it is clear that the fuel cell industry is one of mixed messages, with the number of patens falling, yet academic research outputs increasing. Additionally there have been recent closures of companies, alongside companies re-entering the fray. What should be taken from this is not that the industry is in decline; rather it is looking to consolidate. Instead of breaking new ground with new technologies, applications and materials the industry is looking to build upon what has already been achieved and turn years of technological progress into profitable business. The next great barrier to fuel cell market success may not scientific or technical in nature, rather for companies to succeed they will need to identify markets and consumers who demand fuel cell products.

AcknowledgementsThe authors of this report would like to acknowledge the help and support received from the ABIA program (Accelerating Business Innovation Activities) at the University of Birmingham, which is an ERDF funded programme. Furthermore, the authors would like to thank the various contributors, including; Lois Milner, Laura Allerston, Aimee Jackson, Charlotte Webber and Dr. James Wilkie.

www.hgf.com HGF Limited @hgf_ip

www. bluevineconsultants.com Blue Vine Consultants @BlueVineConsult

The authors of this report would like to acknowledge the help and support received from the ABIA program (Accelerating Business Innovation Activities) at the University of Birmingham, which is an ERDF funded programme. We would like to thanks Dr. James Wilkie, CEO of Alta Innovations & Chair ACAL Energy Scientifi c Advisory Board, for his helpful and insightful comments of the fi nal draft of this report. Furthermore, the authors would like to thank the various contributors, including; Lois Milner, Laura Allerston, Aimee Jackson & Charlotte Webber.

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