Transcript Document

All pages are deemed copyright AFC Energy November 2014
AIM Invest Forum
Ian Williamson
November 2014
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Global fuel cell market…
coming of age…
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Revenue in 2012 tops $1 billion, $2 billion by 2014
Stationary fuel cells represent over 70% of sector revenue at end 2013
20 companies represent 95% of the stationary sector revenue
780 MW market by 2015 in Korea alone (Source Kepco)
7000 MW market globally by 2022
Source Navigant Research – Q1 2014 stationary fuel cell report
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1950s technology…….
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Alkaline fuel cells proven to work…
Years of reliable mission critical operation
Most electrically efficient fuel cell
Failed to compete historically due to:
• system cost
• cheap fossil fuels
• application areas
Constraint
Industrial Fuel Cells
Vehicle Fuel Cells
Weight and size
flexible
strict, in vehicle
Fuel storage
no
yes
Power density
Low -medium
high
Safety systems
industrial
public
Response/cycles
steady state,
several per year
rapid,
several a day
AFCs provide on board power for
space shuttles and submarines
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…modernised by AFC for 21st century
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AFC Energy founded in 2006
Developed new catalyst materials to substitute platinum
Extended fuel cell longevity/performance to a level where it can compete with
fossil fuels and alternative energy at the point of use
Materials, recycling and modular design achieves low lifetime cost of ownership
New KORE system, validated design and now in production
Implemented multiple demonstration projects
Created significant IP and differentiated business proposition for customers
Used less than £29 million total equity since inception, reflecting low cash burn
and tight cost control
AFC has turned legacy technology into a market ready
product
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AFC’s modular design
• Simple
• 30+ families of patents covering key technology
• Basic modular design
• Standard industrial materials
• Low cost scale-up to automated manufacturing
• Designed reuse or recycling
• Ease of O&M
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System development
2009
Beta - 50kW
2012
2014
Alpha - 5kW
KORE - 250kW
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KORE – in build
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Current projects & partnerships
Electrode and Cartridge
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AkzoNobel via Bitterfeld trials since 2009
KORE development and build
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Operational review completed
System ‘hazop’ completed
BoP long term build contracts
KORE operation demonstration-Power Up
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First build match funding provided by HFC - JU
Molecules produced by Dow Chemicals, Germany
Site and interconnections by Air Products
Expected delivery of the KORE to Stade mid 2015
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Manufacturing tools
Automated extrusion of electrode layers
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Manufacturing tools
Automated electrode stacking
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Product cost reduction
Based upon:
£18,000
• Technical improvements such
as reduced substrate area and
lower catalyst content
£14,000
£12,000
Cost [£]
• Purchasing improvements, i.e.
the use of lower cost
materials at the same quality
included
£16,000
£10,000
£8,000
£6,000
£4,000
£2,000
• Recycling and leasing
materials
£2014 BOM COST
2014 FULL REUSE*
2017 ON
2017 ON WITH REUSE*
• Scale up
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Efficient, reliable, economically viable
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Desired model is to install, own, remotely operate and maintain
Different business structures considered initially to reduce cash requirements
Willingness to undertake flexible revenue models i.e. partnering & licensing
Use of grant funding to improve capital utilisation for technical development
Strategy allows protected IP position for the company
Focus on MW-scale stationary applications
Targeting low hanging fruit....
• applications where hydrogen is available i.e. chlorine production
….. Plus key geographic markets with favourable incentive regimes
• e.g. South Korea, US, Germany
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Korean stationary fuel cell sector
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South Korea is the 10th largest energy consumer globally
97% dependence on foreign energy supply - substantial fossil fuel imports
Korea has introduced incentives to increase clean energy independence
Fuel cells are one of the most ‘valuable’ technologies in REC terms
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Kepco, the state-owed Korean electricity utility, is targetting stationary fuel cell installed capacity
to increase from 306 MW at present to approximately 780 MW in 2015 and almost double again
by 2020
July 2014 announcements
Chang Shin
• MOU with a leading hydrogen supplier, for multiple fuel cell systems with a total potential generating
capacity of up to 5MW
Daniel
• HoA with a fuel cell focused power plant owner for an initial 1MW fuel cell system with a follow on
option for a further 3MW supply included, depending on performance
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US stationary fuel cell sector
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88MW of fuel cells were installed or ordered by US business in 2013
Total installed capacity at end 2013 exceeded 170MW
Growth in data centres has produced a burgeoning market for stationary fuel cells
– Companies such as AT&T, ebay, Apple, Verizon
US grid utilities have also begun installing MW grid connected fuel cells
Incentive support is provided at both federal and state level
Allied New Technologies and Foster Wheeler
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Chlor-alkali site at Florida vents large amounts of hydrogen daily as a normal part of its operation.
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Using the vented hydrogen via AFC fuel cells to generate power was therefore conceptually attractive
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A Foster Wheeler study looked at the power generated and its value to Allied or similar sites when using AFC’s fuel
cell technology
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Foster Wheeler’s work showed that the system can be operated at a profit which could potentially be enhanced
using incentives where available
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Financials
Income
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Grant revenue increased at the half year by approximately 500%
Licence revenue increased at the half year by approximately 100%
Costs
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Cost controls remains tight
Administration expenses per employee reduced by 24%
Additional spend on space and people delivering technical
advancement
Cash
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Cash at half year £4.96m was 2.59 times the cash absorbed in
operating activities during the half year
Raised £6.1m last month from city and open offer
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Summary
Commercially
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AFC now has a significant global prospect list in a market showing rapid growth
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AFC is in the process of closing its first commercial deals
Technically
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First commercial module will be commissioned mid 2015
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Production costs are being reduced rapidly
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Output is set to be increased exponentially
Financially
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Tight ship, low overhead
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Mitigation by grant where possible
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Revenues beginning to flow
A simple, game-changing, hydrogen-based, power generation
technology
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Thank you for your kind attention
for more information please visit
www.afcenergy.com