Duke Energy Acquires a Portfolio of Distributed Fuel Cell Projects From Bloom Energy

July 2, 2019
It’s the type of alliance that may be a harbinger of things to come in the energy sector: Duke Energy is acquiring a portfolio of projects from Bloom Energy that use fuel cells — all part of Duke’s efforts to provide on-site generation with microgrids to customers with critical loads.

It’s the type of alliance that may be a harbinger of things to come in the energy sector: Duke Energy is acquiring a portfolio of projects from Bloom Energy that use fuel cells  — all part of Duke’s efforts to provide on-site generation with microgrids to customers with critical loads.

As both companies explained during interviews, the market place is demanding a more reliable power source that is also cleaner and potentially more cost effective. To that end, those businesses that cannot afford to lose power even momentarily are the best prospects: hospitals, data centers and universities, for example.

Duke’s competitive arm, Duke Energy One, has purchased about 37 MW of Bloom Energy servers, and it has already secured long-term power purchase agreements with customers in California, Connecticut, Maryland and New York. The deals have an average weighted time period of 17 years.

“Most customers want reliable, resilient and cleaner energy,” says Catherine Butler, spokeswoman for Duke. “It can also be a back-up generation source in the event of weather while meeting their sustainability targets and reducing environmental footprints. Some of these will have microgrid setups, meaning that if there is a power outage from the centralized grid, the servers will kick on, and they can go to a microgrid.”

The servers, otherwise known as fuel cells, will run on natural gas and biogas, delivered to customer sites via pipelines. In most cases, the servers will continually make power. In some cases, they will work in concert with microgrids. The fuel cells do not generate combustion-related pollutants such as sulfur oxides, nitrogen oxides or particulate matter.

Bloom says that its solid oxide fuel cells can produce power around the clock while also having the same zero-carbon footprint that wind and solar plants have.

According to Butler, the return on investment can vary among customers. In California and the Northeast, for example, customers often pay more for power, which makes the fuel cells more cost competitive. Elsewhere in the country, such on-site generation with microgrids would come at a premium. Butler says that customer needs are changing and that the business strategy with Bloom is “another option for us.”

“This is all about value propositions: sustainability, affordability and reliability,” adds Erica Osian, spokeswoman for Bloom. “This partnership illustrates that need for customers. They are seeing changes in extreme weather and the impact these events are having on reliability. We are able to provide solutions with resiliency that are meeting their needs.” 

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About the Author

Ken Silverstein

Since the late 1990s, I've covered energy, beginning with the rise and fall of Enron -- first as a magazine writer before becoming a columnist. For more than seven years, I've been a columnist for Forbes while also expanding my coverage to include key environmental issues and emerging technologies such as microgrids. I've also done some global reporting of those same issues that touch the African and Asian regions. My work has appeared in, and by cited by, dozens of publications and broadcasts.

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