FuelCell Energy Signs Agreement with South Korean Power Producer

FuelCell Energy, Inc. announced an expanded agreement with its Korean strategic distribution partner, POSCO, under which POSCO’s subsidiary POSCO Power will become a provider of FuelCell Energy’s Direct FuelCell (DFC) power plants in Korea, and will manufacture the balance of plant equipment for the plants.

Under the 10-year license and distribution agreement, POSCO Power will create a fuel cell sales and service organization. Fuel cell stack modules will be manufactured by FuelCell Energy in Connecticut and shipped to Asian customers for installation with POSCO Power balance of plants. POSCO Power also will build a facility to manufacture the balance of plant (non-fuel cell stack portion of FuelCell Energy’s DFC power plants) in Korea. In addition to Korea, POSCO has the right to sell DFC power plants worldwide except in North America, Europe, the Middle East and Japan. The Korean Ministry of Commerce, Industry and Energy (MOCIE) has been a strong proponent of Korean energy independence. Last year, MOCIE announced a new renewable energy subsidy program, under which fuel cells powered by biogas and natural gas received subsidies in excess of the amounts allocated to wind power, biomass, and hydro, and second only to solar power. For fuel cells running on natural gas, the current subsidy is $0.28/kilowatt hour (kWh) and $0.023/kWh for those running on biogas, decreasing 3 percent annually for new installations up to a cap of 50 MW. A binding Renewable Portfolio Standards program is expected to be signed into law by 2009. With these policies in place, South Korea is slated to become one of the world’s leading adopters of clean energy technology.
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