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Bright prospects for fuel cell micro-cogeneration in Europe

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More than €140 million, from industry and the public-private partnership Fuel Cell and Hydrogen Joint Undertaking (FCH JU) will fund two projects, ene.field and PACE, aimed at the mass-scale deployment of fuel cell micro-cogeneration for residential heating and electricity.


“I thought it would be nice to have my own power plant,” says Jochen Steneberg, a participant in the ene.field project field trial, and one of 3500 households and businesses across Europe that are currently using fuel cell micro-cogeneration for their heating, hot water and electricity supply.


The product is transforming Europeans like Steneberg into active energy ‘prosumers’ (producers-consumers) that can sell excess electricity back to the grid, creating a decentralized energy system with a reduced carbon footprint – and lower energy bills.


The fuel cell works by combining hydrogen produced from the fuel and oxygen from the air to generate electricity and heat. Currently fueled by gas from the grid, it is hoped that the “fuel flexible” technology will be progressively fueled by renewable energy sources, such as hydrogen and renewable gas, converting a home fuel cell into a renewable energy technology.


Major industry players, including ENGIE and Total, are convinced that green gases, biogas and renewable hydrogen, are key to the energy transition.  “Hydrogen as a universal vector is set to bring its benefits to energy users across the planet, 24/7,” said Thierry Lepercq, Executive Vice-President of ENGIE, during his announcement on 8 November at COP23 in Bonn of new industry cooperation in developing renewable hydrogen.


Falling costs


Fuel cell micro-cogeneration is already competitive with other home energy solutions in terms of operational costs, reducing consumers’ energy bills up to 34%. Although upfront costs for fuel cell micro-cogeneration remain high, national supports are now available for early market uptake. Germany is currently the most advanced market in Europe, with over 1500 units installed. Recognizing the potential of fuel cell micro-cogeneration, the German government’s scheme, KfW433, offers grants in the range of €5,700-€28,000, with €10,000 offered for a 1 kilowatt-electric (kWe) system. Support for fuel cell micro-cogeneration in other countries, including Belgium, France, and the UK, is through feed-in premiums, feed-in tariffs, and white certificates/green certificates.


The successor project PACE, financed with €90 million shared between European industry and the EU, aims at bringing unit costs down sufficiently to mainstream the technology, and establishing Europe as a global leader in fuel cell micro-cogeneration.


By 2021, PACE aims at installing at least 2,500 units in Europe, and manufacturing in the order of 10,000 units per year post 2020, with project partners BDR Thermea, Bosch, SOLIDPower and Viessman. It is estimated that manufacturing volumes upwards of 500 units / year will lower the cost of units by around 30-40%, as has been demonstrated by Japan’s Ene-farm program. The program, in which the Japanese government and manufacturers joined forces, saw costs fall from €24,000 (3,3 mln YEN) per unit in 2009, to around €10,000 (1,36 mln YEN) in 2015.


“Major European manufacturers are now committed to bringing the technology closer to mass market by increasing scale and achieving further product cost reductions. PACE will enable manufacturers to establish fuel cell micro-cogeneration as a standard technology”, said Hans Korteweg, managing director of cogeneration industry association COGEN Europe, and coordinator of the PACE and ene.field projects.


System benefits


Mike Small is the group product manager for cogeneration at BDR Thermea Group, one of Europe’s major heating companies and a project partner in PACE. Small says: “Today, we are faced with new challenges, in an increasingly complex energy system which is incorporating growing capacity of intermittent renewables. Through PACE we look forward to demonstrating the additional system benefits delivered by fuel cell micro-cogeneration.”


The system benefits of a higher market penetration of fuel cell micro-cogeneration could be significant in Europe’s future decentralized energy system, according to a recent report from Imperial College London. According to the simulation studies carried out, adding fuel cell micro-cogeneration to the European energy mix could generate a gross reduction in infrastructure and operating costs of more than €6,000 for every kilowatt-electric (kWe) of installed capacity up to 2050. System benefits at distribution level can amount to €1,600 - €2,600 per installed kWe, mainly by deferring the investment cost at the low voltage level. Regarding CO2 emissions, fuel cell micro-cogeneration can achieve reductions in the range of 370 – 1,100 kg CO2 per year for each kWe of installed capacity, compared to a scenario without micro-cogeneration.


Although many of the attributes of fuel cell micro-cogeneration are emphasized in Europe’s climate and energy goals - energy efficiency, renewable energy, decarbonisation, consumer empowerment, job creation and innovation – existing policies tend to address heat and power separately, not accounting for the full benefits of cogeneration.  Better recognition for micro-cogeneration is needed in key policy instruments, including energy labelling, building codes, the Covenant of Mayors framework and grid tariffs for self-generation. Moreover, removing administrative barriers to connect to the electricity grids would encourage take-up of this promising technology.


As the Clean Energy policy package, currently under negotiation in Brussels, sets the rule book for the next decade of Europe’s energy transition, policymakers should take note of these recent developments in the hydrogen economy: policy support will be a decisive factor in the take-up of fuel cell micro-cogeneration.