In a commercial update in November, the alkaline fuel cell developer said it will have a low cost per kWh (kilowatt hour) compared to alternative generating systems, partially as a result of its ability to use lower quality and less expensive hydrogen sources.
The company also said it was working with a leading clean-tech specialist consultancy to build on existing commercial activities and establish alternative distribution channels to accelerate future growth.
AFC is one of the UK market leaders in what is becoming known as the Hydrogen Revolution, the development of technology that can transform hydrogen into a renewable energy source.
According to The Hydrogen Council, an industry group backed by companies such as BMW and Air Liquide, the hydrogen market could be worth around US$2.5 trillion by 2050 as part of a push to decarbonise transport and limiting global warming to safer levels.
Strong emphasis is being placed by the company on the preparation for commercial deployment and the strengthening of its supply chain in response to an order from Australian waste oil refiner Southern Oil as well as growing interest for fuel cell systems from potential customers in Japan and the Asia-Pacific region.
AFC has established further improvements in electrode longevity and cost reduction through its joint development activities with Industrie De Nora and is in the final stages of confirming an electrode pairing for the Southern Oil project. These electrodes are expected to be supplied by Industrie De Nora to AFC in the first quarter of 2019.
AFC added it expects to finalise its appointment of a mass-produced flow plate manufacturer by the end of 2018, following an international competitive tender. The process is expected to result in further cost reductions on a "per part" basis relative to earlier cost modelling conducted by the company.
The design of AFC Energy's new flow plate has all fuel cell components integrated within a single sub-assembly, which is expected to deliver not only material improvements in system performance but also a more streamlined and robust quality control function to help eliminate potential failure modes.
The company has also commenced discussions with a leading international engineering and fabrication company whose focus is on optimised low-cost containerisation solutions. This company is currently working with AFC on the design for a 40ft containerised fuel cell system that could deliver between 150 kW and 200 kW of power under a "plug and play" design system.
“This is an exciting development for AFC Energy as it should result in a productised fuel cell system capable of rapid deployment to any number of locations internationally, as is the case for carbon-emitting diesel generation,” the company told investors.
Completion of these key activities will also move AFC Energy closer towards achieving its commercial deployment goals.
Meanwhile, over the past twelve months, AFC has been developing a high-power density alkaline fuel cell that is a variant of the company's existing technology platform. This version of the fuel cell is highly complementary to the existing alkaline system but materially opens the market for deployment in new off-grid, or space and weight constrained environments, AFC said.
The company is also looking to host a hydrogen fuel cell micro-grid at Dunsfold Park in Surrey, working with the management and the owner of the neighbouring anaerobic digestion plant for the supply of fuel cell systems to the Park's development site.
A review of commercial opportunities at Dunsfold has identified an opportunity for the company's fuel cells to be used in place of diesel generation during the construction phase of the park’s redevelopment. While delays have occurred in the final permitting and consenting of the development site, the company is now working with the site's management to progress this project through to its next phase.
"It's been a busy but successful twelve months both in terms of AFC Energy's preparedness for commercial deployment and in its drive towards clear platforms for deployment in the massive off-grid power market,” said Adam Bond, AFC's chief executive.
“Our aspiration to become a leading supplier of hydrogen-based solutions across the value chain is now within sight and we look forward to consolidating and growing our existing pipeline of projects both in the UK, Australia and internationally.”
With shares trading at around 5p as of 4 January 2019, AFC carries a market cap of £17.5mln.