Hotel Chain Looks to Fuel Cells for Power

FuelCell Energy and Alliance Power have formed the joint venture, Alliance Star Energy, and entered into an energy agreement with Starwood Hotels & Resorts Worldwide. The agreement provides the framework for fuel cell power plant projects for Starwood’s hotels and will streamline the process for business opportunities between Starwood and Alliance Star Energy.

Initial focus will be in California, but the arrangement is open to all of Starwood’s hotels and resort properties. The first project is to provide 1 MW of fuel cell power to the Sheraton San Diego Hotel and Marina, the fourth hotel employing FuelCell Energy’s Direct FuelCell (DFC) technology. Four 250 kW DFC power plants will supply base load electricity for the 1,044-room hotel, and the heat byproduct will be used for the hotel’s Lagoon Pool. The San Diego Regional Energy Office, administrator for The California Public Utilities Commission’s (CPUC) Self-Generation Incentive Program for the San Diego area, issued a reservation letter that will provide incentive funding of up to $2.5 million of eligible project costs to the combined entity. “The satisfaction with other projects at Sheraton hotels, and the enabling California Self Generation Incentive Program, has created a clear value proposition for our DFC power plants at Starwood’s properties throughout California,” said Herbert T. Nock, senior vice president of Marketing and Sales of FuelCell Energy. The San Diego project and subsequent transactions under this MESA are to be based on power purchase agreements (PPAs). The CPUC Self-Generation Incentive Program was created to encourage customers of electrical corporations to install distributed generation that operates on renewable fuel and/or contributes to system reliability. Existing law defines ‘ultra-clean and low-emission distributed generation’ as an electric generation technology that produces zero emissions during operation or that produces emissions that are equal to or less than limits established by the California Air Resources Board (CARB). The program currently runs through 2007 and provides up to $67 million per year in incentive funding for clean and renewable generators, including fuel cells.
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