Fuel cell company Proton Energy Systems has had its ups and downs over the past week. The good news came this week in the form of a three-year contract with the U.S. Department of Energy (DOE) for a potential $3.8 million research project. The bad news came last week when Proton found out a distribution agreement with General Electric (GE) had been terminated, sending Proton’s parent company, Distributed Energy Systems’ stock falling by as much as 23 percent at the close of the markets last Friday, according to CBS Market Watch.Wallingford, Connecticut – August 5, 2004 [SolarAccess.com] GE gave proton no reason for the agreement but Proton’s President Walter “Chip” Schroeder said they were seeking an explanation. “We do not believe their termination was motivated by any actions on our part. In fact, the units that we have placed with GE, including a system delivered more than two years ago, are performing well,” Schroeder said. “Proton will continue its good faith effort to address and resolve this matter, but we cannot be confident of a fair and satisfactory outcome.” The upcoming DOE research project would focus on developing methods to reduce the cost of high-pressure hydrogen generation from Proton Exchange Membrane (PEM) electrolysis. Air Products, which specializes in hydrogen production and distribution, was selected by Proton to be a subcontractor to optimize the compression, storage and dispensing module for systems intended to supply hydrogen to fuel cell vehicles. “This project will demonstrate the capabilities of our premier hydrogen distribution and delivery know-how with Proton’s renewable hydrogen generation technology,” said Ed Kiczek, Air Products’ senior business development manager for Future Energy Solutions. Under the project, Proton and Air Products will perform research and development activities on a low-cost, electrolysis-based hydrogen generation system capable of delivering hydrogen at 5,000 psi and greater for automotive fueling. Proton and Air Products will evaluate different system designs, including various renewable technology inputs. Proton’s proprietary high-pressure cell stack will be a key component in the design of the system. Performance against objectives in the first budget period will determine if additional periods will be funded.