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Asia Pacific green trend boosts fuel cells

Posted: 16 Dec 2009 ?? ?Print Version ?Bookmark and Share

Keywords:fuel cell? APAC market? green energy? renewable energy?

Green energy is increasingly becoming a concern for governments, and many countries in Asia Pacific are targeting 8 to 20 percent renewable energy in their energy mix by 2020 to 2025. This has made the region an attractive option for the implementation of renewable power generation sources, including fuel cells.

New analysis from Frost & Sullivan, Asia Pacific Fuel Cells Markets, finds that the stationary fuel cells segment earned revenues of $142 million in 2008 and estimates this to reach $1.9 billion in 2015. At the same time, the portable fuel cells segment earned revenues of $1 million in 2008 and estimates this to reach $12 million in 2015.

The push for green energy technologies has intensified considerably over the last couple of years. Kyoto targets, government's emissions reduction targets, as well as the support for green technologies c has been some of the key drivers for new, cleaner technologies development and adoption across the APAC region. Fuel cells are just one such example.

"As with any other new product, the initial costs of technology, low end-user awareness, and the lack of a proven track record of continuous and reliable operations restrict the degree of adoption of fuel cells," said Irina Sidneva, program manager, Frost & Sullivan. "However, given the technical qualities of the product, the application potential for fuel cells is enormous".

The fuel cells market is currently holding on to its market position mainly on the strength of government subsidies, incentives, and favorable policies. The eventual adoption of fuel cell as the power source of choice will depend on how aggressively and effectively local governments market it.

In Japan, the Ministry of Economy, Trade and Industry is running a millennium project on automotive and residential fuel cell markets. In 2009, the emphasis of the third phase of the project is on the commercialization of fuel cellson creating positive market conditions to motivate mass adoption.

Meanwhile, the Ministry of Knowledge Economy in South Korea is supporting extended trials and diffusion of the product to stimulate wider uptake. While ANZ and several SEA countries are still in the planning phase of fuel cell technology rollouts, Singapore, Malaysia, and Thailand are actively developing fuel cells R&D capabilities. In SEA, the pride of place goes to Singapore, with its government striving to position the country as a regional hub for fuel cell technology R&D and application.

However, the demand is still limited from most other countries due to inadequate assistance from the regional governments and the high initial costs of the technology. Moreover, fuel cells have an added disadvantage of competing with mature products such as diesel and gas engines, generator sets, and batteries. Therefore, along with technological advancements, fuel cell companies also have to aggressively educate customers about the benefits of fuel cell technology.

"At the moment, other renewable energy sources such as solar panels and wind turbines are seen to have higher potential in the immediate future, while fuel cell technology has to be monitored until it is ready to be introduced to the mass market," noted Sidneva. "Fuel cells' costs need to come down tenfold and the number of years of operation needs to double to be competitive in the mass market."

Given the recent trends in fuel cells technology development, mass market adoption in the Asia Pacific is forecast to take off by 2015 for stationary fuel cells, and by 2020 for portable fuel cells.

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