BLOOM BOX SCHEMES TO MAKE NUMBERS ADD

Bloom Energy’s Fuel Cells-as-a-Service: Do the Economics Work? Why buy the $750,000 box when you just need the energy? Manufacturing boosted to one Bloom Box a day.
Michael Kanellos, January 20, 2011 (Greentech Media)

"Bloom Energy is taking a page out of the solar playbook and starting to market its solid oxide fuel cells as a service.

"Under the Bloom Electrons program, Bloom installs its Bloom Energy Servers on a customer's premises and then sells the power to its customer the same way a utility would. Bloom buys the natural gas to run the Energy Servers, conducts maintenance, and takes care of all of the tax credits and permits. (The Energy Servers convert natural gas to electricity…[P]ower bills decline by 5 to 20 percent…[and the customer avoids the $700,000 to $800,000 server price as well as]…the risk that the fuel cells might start to become less efficient over their ten year run or require more repairs than anticipated…"

Schematic of a Bloom Energy Server (click to enlarge)

"…[R]ising power prices, low gas prices and declining prices for manufacturing these boxes will certainly help. In California, commercial customers pay 14 cents a kilowatt hour for conventional electricity…Bloom is likely selling power to these customers at 13.3 to 11.2 cents a kilowatt hour…Customers that are buying Bloom Servers say the boxes generate power for around 7 to 10 cents a kilowatt hour…These numbers include the 30 percent Federal tax credit and California state incentives of around $2.50 a watt…Bloom thus has a potential margin of around 3 to 6 cents a kilowatt hour, including the incentives…

"…[M]any states do not have the same local-level incentives…Nationwide, commercial/industrial power on average sells for 10.55 cents a kilowatt hour, according to the Energy Information Administration, and sells for under 10 cents a kilowatt hour on average in the Southeast, Mountain West and the Plains states. In those regions, Bloom likely isn't economical just yet…[Bloom] will concentrate on California…"

Bloom Energy Servers at Caltech (click to enlarge)

"Will the concept take off? If solar is any indication, the answer is yes. Sungevity, the retail solar installer, says that its customer base has almost completely converted from solar buyers to solar-as-a-service customers within the space of a year. The business has also grown tremendously. SolarCity and others report similar results…Bloom is currently in the process of installing a 2 megawatt fuel cell facility on the Caltech campus under the Electrons program…[the 20 boxes make] it the largest [installation] in the world. Companies and institutions participating in the Bloom Electrons program include Kaiser Permanente, Wal-Mart and Coca-Cola…

"Bloom [production] is up to one Bloom Server a day, up from one a month two years ago…For now, Bloom will market its servers and services to provide baseline power…[T]he boxes could serve as storage devices or provide jolts of peak power…[because] the Energy Servers can also provide power quickly…It is also keeping an eye on ways to couple its fuel cells with electric vehicle charging…[I]nstalling a fuel cell, flow battery or other storage device…[could prevent] EVs spiking peak power…Cars charge from the storage device and the storage device gets recharged overnight."