Fuel Cells - Nearly here

Yesterday I attended the "Low Carbon and Fuel Cell Knowledge Transfer Network" (bit of a mouthful that) seminar on Fuel Cells. Four listed companies presented with others exhibiting. Interesting technology but despite low share prices (CMR Fuel Cells is valued at half it's cash holdings) I came away a little disappointed from an investment standpoint.

The fuel cell concept is not new having originally been invented in 1843 and, whilst used in the Apollo moon project, it is only now that commercial products are on the verge of being made available. There was a lot of talk at the show about how difficult they are to engineer for volume manufacture and to reduce the size of the devices to match modern requirements.

Ceres Power and Ceramic Fuel Cells both produce Combined Heat and Power (CHP) systems but on examination these are really just more efficient boilers, still running on natural gas, and producing a bit of electricity as well as heat. In the case of Ceres Power volume manufacturing is 3 years away, it is likely to be an expensive "top end" item which saves about 25% of fuel bills. OK in time that will make a significant dent in domestic fuel consumption but to my mind these need a Government subsidy (or much higher fuel prices) to make them really fly.

CMR make fuel cells for portable devices, laptops being the prime market targeted, but again a commercial product is still 3 years away.

I will continue to follow this sector but mostly through curiosity since I clearly have no way of being able to evaluate these companies technically nor come to any view on their ultimate profitability and hence current value. The OEMs themselves seem only to be cautiously investing in some of the companies, no doubt reflecting their uncertainty as to which technology will eventually succeed.