Cost Analysis Comparison of Bloom Energy Fuel Cells
with Solar Energy Technology and Traditional Electric Companies
A Project Report
Presented to
The Faculty of the Department of General Engineering
San Jose State University
In Partial Fulfillment
of the Requirements for the Degree
Master of Science in Engineering
by
Alina Adams
Amrita Chowdhary
Vasudha Subbaiah
Amrita Chowdhary
April 2011
 2011
Alina Adams
Vasudha Subbaiah
Amrita Chowdhary
ALL RIGHTS RESERVED
ii
SAN JOSE STATE UNIVERSITY
The Undersigned Master's Project Committee Approves the Master's Project Titled
COST ANALYSIS COMPARISON OF BLOOM ENERGY FUEL CELLS
WITH SOLAR ENERGY TECHNOLOGY AND TRADITIONAL ELECTRIC
COMPANIES
by
Alina Adams
Vasudha Subbaiah
Amrita Chowdhary
APPROVED FOR THE DEPARTMENT OF GENERAL ENGINEERING
________________________________________________________________________
Mr. Karl Stahl
Technical Advisor, Tesla Motors
Date
________________________________________________________________________
Prof. Mithal Albassam Academic Advisor, Department of Industrial and Systems Engineering
San Jose State University
Date
________________________________________________________________________
Dr. Leonard Wesley
Associate Professor, Department of Computer Engineering
San Jose State University
Date
APPROVED FOR THE UNIVERSITY
________________________________________________________________________
Associate Dean
Office of Graduate Studies and Research
iii
Date
Abstract
Cost Analysis Comparison of Bloom Energy Fuel Cells
with Solar Energy Technology and Traditional Electric Companies
by
Alina Adams
Vasudha Subbaiah
Amrita Chowdhary
Whether it is due to climate concerns or the inevitable depletion of fossil fuels, the future
of electricity generation is headed toward cleaner alternatives. In order to bring new
technologies to the market, funding must be secured for research and development.
Investors and government agencies rely on forecasts for the future to decide what
direction to pursue. Our project investigates the Bloom Box, a new fuel cell technology
being developed by the Bloom Energy companyCompany. The Bloom Box represents a
potential breakthrough in fuel cell technology, offering a cheaper and more efficient
option for the future. Our analysis compares the Bloom Box with the traditional method
of purchasing energy from a utility company and the clean energy alternative of solar
panels. We include all costs associated with these three electricity sources and account
for the time value of money to forecast which will offer the cheapest option for providing
electricity to a residential consumer over a 10-year period. In addition to the baseline cost
estimation, we also explore different cost forecast scenarios to identify the most
important cost components for Bloom Energy in developing a competitive and successful
product for the future.
iv
Acknowledgements
We would like to express our gratitude to Mr. Karl Stahl for his help and support
during the project. His technical expertise in the field of mechanical engineering was
truly a great help in our research efforts.
We would like to thank and show our appreciation to Dr. Mithal Albassam. Her
advice was very valuable and helped guide us throughout the project. Her experience in
financial analysis was critical to our project, and her experience in academia helped steer
us in the right direction.
We would like to thank Dr. Leonard Wesley for his instruction in class, as well as
his individualized advice outside the classroom. He truly helped us pull the whole project
together, and we greatly appreciate his efforts.
v
Table of Contents
1.0 Introduction ………………………………………………………….……...
2.0 Project Scope ………………………………………………………………...
2.1 Objective ……………………………………………………..……...
2.2 Hypothesis …………………………………………………………...
2.3 Method of Investigation ……………………………………...……...
2.3.1 Experimental Procedures …………………………..……...
2.3.2 Resources Utilized ………………………………………...
3.0 Literature Review …………………………………………………...……....
3.1 Forecasting the Cost of Electricity
Purchased from Electric Companies ………………………………...
3.1.1 Electricity Usage …………………………………………...
3.1.2 Electricity Prices …………………………………………...
3.1.3 Factors Affecting Electricity Cost …………………………
3.1.4 Cost Prediction ……………………………………………..
3.1.5 Cost of Natural Gas ………………………………………...
3.2 Fuel Cells …………………………………………………….……....
3.2.1 Fuel Cell Introduction ……………………………………...
3.2.2 Fuel Cell Technology ………………………………………
3.2.3 Usage of Fuel Cells ………………………………………...
3.2.4 Types of Fuel Cells: Pros and Cons ………………………...
3.2.5 Fuel Cell Cost Components ………………………………..
3.3 Solar Energy ………………………………………………………...
3.3.1 Solar Energy Introduction …………………………………
3.3.2 Types of Solar Energy ……………………………………..
3.3.3 Solar Energy Pros and Cons ……………………………….
3.3.4 Classification of Solar Panels ……………………………...
3.3.5 Photovoltaic Solar Cells ……………………………………
3.3.6 Market End-use Sectors ……………………………………
3.3.7 Solar Energy Costs …………………………………………
3.3.8 Solar Energy Maintenance Costs …………………………..
3.4 Total Current Cost Summary ………………………………...……...
4.0 Cost Analysis Formulation …………………………………..……...……....
4.1 Return On Investment Selection ……………………………..……...
4.2 Analysis Cases ……………………………………………….……...
4.3 Bloom Box Cost Analysis …………………………………………...
4.3.1 Bloom Box Purchase Price …………………………………
4.3.2 Bloom Box Installation Cost ……………………………….
4.3.3 Natural Gas Fuel Cost ………………………………………
4.3.4 Price Trend of Natural Gas …………………………………
4.3.5 Cost of Bloom Box Maintenance …………………………..
4.3.6 Bloom Box Salvage Value …………………………………
4.3.7 Bloom Box Cost Estimation Equations ……………………
vi
1
2
2
3
3
45
65
76
67
67
68
68
811
911
129
129
1511
184
195
2419
282
282
293
3024
3225
2347
3428
3528
370
381
391
4032
4033
4234
4234
4234
4334
4435
4435
4435
4367
4.4 Solar Panel Cost Analysis …………………………………………...
4.4.1 Solar Panel Purchase Price …………………………………
4.4.2 Solar Panel Installation Cost ……………………………….
4.4.3 Cost of Solar Panel Maintenance …………………………..
4.4.4 Solar Panel Salvage Value …………………………………
4.4.5 Solar Panel Cost Estimation Equations …………………….
4.5 Electric Company Cost Analysis …………………………….……....
4.5.1 Electric Company Cost Estimation Equations ……………..
5.0 Results and Discussion ……………………………………….……...……...
5.1 Baseline Cost Estimate ……………………………………….……...
5.2 Minimum and Maximum Cost Estimates …………………….……...
5.3 Individual Input Parameter Dependence ……………………..……...
5.4 Varying ROI ………………………………………………….……...
5.5 Bloom Box Cost Strategy …………………………………….……...
5.5.1 Bloom Box Purchase Price Importance ……………………
5.5.2 Bloom Box Maintenance Cost Importance ……………….
5.5.3 Government Subsidies …………………………………….
6.0 Economic Justification ……………………………………………...……....
6.1 Executive Summary ………………………………………….……...
6.2 Problem Statement …………………………………………………..
6.3 Solution and Value Proposition ……………………………………...
6.4 Market Size …………………………………………………..……...
6.5 Competitors …………………………………………………..……...
6.6 Customers …………………………………………………………...
6.7 Cost ………………………………………………………………….
6.7.1 Fixed One-time Cost ………………………………………
6.7.2 Fixed Recurring Cost ………………………………………
6.8 Price Point …………………………………………………….……...
6.9 SWOT Assessment …………………………………………..……...
6.10 Investment Capital Requirements …………………………..……...
6.11 Personnel …………………………………………………………...
6.12 Business & Revenue Model ………………………………..……...
6.13 Strategic Alliances/Partners ………………………………..……...
6.14 Profit and Loss Statement …………………………………..……...
6.15 Exit Strategy ………………………………………………..……...
7.0 Project Schedule ……………………………………………..……...……...
7.1 Gantt Chart …………………………………………………..……...
8.0 Team and Committee Structure ……………………………..……...……...
9.0 Future Work ………………………………………………………...……...
10.0 Conclusion ………………………………………………………...……...
11.0 References ………………………………………………….……...……...
vii
4738
4738
4738
4738
438
439
5039
5141
5141
5141
542
5443
5746
5947
5947
5947
6048
61
61
63
64
65
66
66
67
68
68
69
70
72
73
76
77
78
81
82
82
84
84
85
86
1. Introduction
In a recent talk given at NASA Ames Research Center, KR Sridhar, Bloom Energy cofounder and CEO, summed up his perspective on sustainability with the following quote,
"the Earth was not given to us by our parents, but rather it was lent to us by our children."
Energy concerns for the future include electricity shortages, pollution, climate change,
and eventually depleted fossil fuel supplies. Whether looking far into the future or even
just at the next few years, determining the correct path for the future of energy production
is an important and relevant topic. Many new clean energy technologies are currently
being developed, and one of the newest alternatives is a fuel cell being developed by
Bloom Energy. The main focus of our project is investigating the role that the Bloom
Energy fuel cell will have in the future of the power industry. If it can be shown that this
fuel cell has strong competitive possibility, it is worth investing more time and money
now to realize its full potential as soon as possible.
We are performing a cost analysis comparing the Bloom Energy fuel cell, solar panels,
and purchasing electricity from a utility company. Each energy source has advantages
and disadvantages that are described in more detail later in this project report. There are
many other sources of electricity such as nuclear electricity generation, wind power, and
hydroelectricity, but these are all typically delivered through electric companies, rather
than being installed at residential locations. The main reason is that most are generated
with very expensive equipment at a large, remote facility. We included solar panels as a
Formatted: Line spacing: Double
competitor to electric companies, because they can be purchased and installed directly at
the source of electricity usage. Furthermore, solar panels are a relatively mature
technology. Fuel cells are another example of an electricity generation technology that
can be installed directly at residential locations.
Fuel cells are not a novel technology, but the Bloom Energy Bloom Box represents a
revolution in fuel cell development. They aim to offer residential customers, for the first
time, a fuel cell that is cheap and efficient enough to be less costly than purchasing
electricity from electric companies. The technology is not yet ready for market, but
Bloom Energy has set a goal of developing a residential Bloom Box available for $3000.
This purchase price, however, is not the only cost that consumers need to consider when
switching from the power grid to a Bloom Box. The equipment will be used over a long
period of time, so the purchase price can be divided over many years, but the user is also
responsible for purchasing fuel and maintaining the fuel cell. In the end, the Bloom Box
will be competitive only if users are confident that it represents a money saving
investment. Furthermore, in order to bring the technology to market, investors must also
fund the research and development phase. Finally, governments interested in promoting
green energy also need guidance in deciding which future technologies have the potential
for success. This project will help illustrate whether or not the Bloom Energy Bloom Box
will become a significant competitor in the future of clean energy.
2
Formatted: Line spacing: Double, Keep with
next, Keep lines together
2. Project Scope
2.1. Objective
The primary objective of this project is to determine how competitive the Bloom
Energy fuel cell technology will be when competing with other electricity generation
sources. This will be largely determined by the bottom line cost in purchasing
electricity. The most common source of electricity is purchasing, based on kilowatt
hours (kWh) used, from a utility company, and this has been due mostly to the fact
that it is the most cost effective source. While there are other factors to consider,
consumers are undeniably interested in saving money. Therefore, we aim to estimate
which, among three competitors, will offer the cheapest source of electricity over a
ten year period.
Formatted: Line spacing: Double
2.2. Hypothesis
If Bloom Energy meets their goal of reducing the price of a residential use fuel cell to
$3000, investing in one will save money over 10 years, compared to using traditional
energy or solar power.
2.3. Method of Investigation
The general approach to testing our hypothesis will involve a detailed estimate of the
total cost of the three different sources of energy over a 10-year period. The primary
energy source of interest is the Bloom Energy residential fuel cell. It will be
compared to the most traditional and widely used energy source of purchasing energy
3
from a major electric company. Finally, the fuel cell is compared to solar power, a
competitive alternative clean energy source that is in a more mature stage of
development.
The 10-year cost of energy is estimated differently for the three different energy
sources, because the user receives them differently. When purchasing energy from an
energy company, consumers just pay per amount of energy used. There is no
installation cost or equipment to maintain over time. Thus, only the price of energy is
needed over the 10-year period. For consumers using either the Bloom Energy fuel
cell or their own solar power generation, there are other costs that must be estimated
such as equipment purchase and maintenance.
Once the setup and recurring costs are estimated, the entire cost is converted to an
equivalent annual energy cost, taking into account the time value of money. Of
course, there will be some level of uncertainty in the estimates, so a range of inputs is
used to evaluate different cases. An attempt is made to identify important cost areas
for Bloom Energy. These include costs with either a high variability or a potential for
improvement.
4
Formatted: Line spacing: Double, Keep with
next, Keep lines together
2.3.1. Experimental Procedures
2.3.1.1. Traditional Energy Company
The main cost associated with buying electricity from a utility company is
simply the price of power at the time. Therefore, estimating the cost of 10
years worth of purchasing energy requires a forecast of the price of electricity
into the future. Studies have been done to predict how the price of energy will
change, so the main task is evaluating the analyses and identifying which are
the most accurate and reliable.
Formatted: Line spacing: Double
2.3.1.2. Solar Energy
Solar energy is used as an example of a cleaner energy source that can
produce energy at the site, rather than purchasing energy from a remote
location. With solar energy, there is an initial cost of purchasing solar panels
and installing them at the location. In addition, there are maintenance costs
over time, because the solar panels lose efficiency, wear our, get dirty, and
possibly need replacement. In order to estimate the 10-year cost of solar
energy, we first need to determine the purchase and installation cost for
enough solar panels to power an average residential house. This is a one-time
cost, because the panels are expected to last for more than 10 years. In
addition to these large equipment investments, there are maintenance costs, so
we estimate the frequency and cost of repairing and maintaining solar panels
as well.
5
2.3.1.3. Bloom Energy
The cost of the Bloom Energy source has similar considerations to solar
power, because there is an initial purchase cost, along with maintenance and
possible replacement costs over time. However, the Bloom Energy fuel cell is
earlier in the development process than solar energy, so the cost estimates are
not as certain. However, historical data is available on other fuel cells, so the
process involves identifying the similarities and differences among different
kinds of fuel cells.
As with solar power, there are purchase and installation costs upfront. Unlike
solar energy, the fuel cell needs a source of fuel to run, so some type of fuel,
in this case natural gas, needs to be purchased regularly over time. We
perform the same price projection for this fuel source as with the energy price
from the power company. Finally, we look at what maintenance costs will be
involved, and their expected price and frequency. The present and future costs
are brought to a common annual cost, and a three-way comparison is made
between traditional energy, solar power, and the Bloom Energy Bloom Box.
2.3.2. Resources Utilized
In order to project the cost of energy into the future, we evaluate energy studies
that have already been done. The most informative source that we have identified
6
comes from the United States Energy Information Administration, and this is
described in more detail in the literature review.
In order to estimate the cost of solar energy, we look at current purchase and
installation prices, and research the current maintenance costs. We also look at
what is currently being developed in solar energy research to find if we expect
any significant changes to the cost of maintenance in the future, such as more
reliable solar cells, or solar panels with a longer life expectancy.
The primary resource used for the Bloom Energy fuel cell is the data that has been
made public by Bloom Energy. However, we do not have access to all of the data
that we need, because Bloom Energy is a private company. Additionally, there are
cost factors that even Bloom Energy does not know for sure. However, for
additional information, we have researched what has previously been
accomplished with fuel cell technology. This involves both a literature review and
speaking to engineers currently involved in fuel cell technology research.
3. Literature Review
3.1. Forecasting the Cost of Electricity Purchased from Electric Companies
3.1.1. Electricity Usage
It has been reported that the demand for electricity in the period from 1970 to
2000 has increased by 50%. If the available energy does not follow a similar
7
progression, the price of electricity will inevitably increase with simple supply
and demand. This will lead either to an increase in the cost of building new
energy sources, or an increase in the cost of electricity due to increased demand.
Thus, these costs must be taken into account when forecasting the future price of
electricity.
3.1.2. Electricity Prices
When looking at previous pricing trends, there is reason to believe that the cost of
electricity from a traditional power company will rise significantly over the next
20 years. Nationally, the cost of electricity has outpaced inflation since the 1970's.
In fact, the U.S. Energy Information Administration reports an 85% increase in
the average national cost of power over the last 25 years [33]. An analysis, in
California, of the past ten years shows an energy price increase of 44 to 65%,
which is an annual increase of about 4 to 5%, without giving reason to believe
that the rate of increase will slow down [33].
3.1.3. Factors Affecting Electricity Cost
3.1.3.1. Infrastructure
One factor that must be included in an electricity price forecast is
infrastructure. From 1970 to 2000, the national investment in electricity
infrastructure has declined, in spite of the fact that demand has increased. Due
to this decrease in investment, some estimates predict that demand will exceed
8
supply as soon as 2013. As a result, power companies will find the need to
increase investment in the years to come. Some have projected this to cause an
increase in the cost of electricity of around 2 to 2.5% per year for the next 10
years [33].
3.1.3.2. Fuel Costs
Another factor that must be included in an estimate of the cost of electricity is
the cost of fuel used in electricity production. As the electricity industry uses
the largest amount of coal and natural gas, the cost of electricity will certainly
increase with a price increase of either resource. It is estimated that the price
of natural gas will double in the next 10 years due to higher demand [4]. Part
of the additional demand is expected to come from climate change regulation
forcing companies away from coal-powered electricity. This increase in gas
prices is forecasted to raise the price of electricity by an annual rate of 1.5 to
2% [33].
3.1.3.3. Climate Change
There is a national push to move toward cleaner energy to reduce greenhouse
gases. Experts are predicting, even with a weak set of clean energy legislation,
the effect on the cost of electricity will be anywhere from 1 to 3% annually.
As an example in California, the AB 32 climate emissions bill is projected to
9
have an inflation-adjusted increase on electricity costs of 5 to 6.5% of current
baseline projections [33].
3.1.3.4. Technology
One factor that could potentially decrease demand for electricity is improved
efficiency through technological development. Some estimates of best-case
scenarios show a per capita residential demand for electricity dropping by
about 40% by 2035. This, however, is an aggressive estimate, and more
conservative estimates for efficiency-related decrease in demand are about
15% [33].
3.1.3.5. Economic Growth
The growth of the economy is another important factor in projecting increased
electricity prices in the future. The overall cost of electricity based on the
economy is estimated for low, medium, and high economic growth cases.
Including all of these effects over the next 20 years, the cost of electricity is
projected to rise from around 8.5 cents per kilowatthour to about 9 cents per
kilowatthour for low economic growth and as much as 11 cents per
kilowatthour for high economic growth [33]. The figure below shows the
conservative and liberal cost estimates based on economic growth.
10
Figure 1. Average annual US retail electricity prices in three cases [33]
3.1.4. Cost Prediction
Because there have been more than one study attempting to forecast the future of
electricity prices from electric companies, a method must be chosen to either
choose the most credible source, or combine information from multiple sources.
While choosing just one approach may not be simple, there is also an option to
look at a range of prices over the 10-year period. For example, it makes sense to
do the cost analysis in multiple parts. There are criteria that can be used to
generate conservative and liberal cost estimates, and it is beneficial to examine
and be prepared for both cases.
3.1.5. Cost of Natural Gas
Since the Bloom Energy generator itself runs on natural gas, it is important to
project the cost of natural gas over the 10-year period as well. As mentioned
11
Formatted: Line spacing: Double
above, some estimates predict a large increase in the cost of natural gas, as much
as 100% in 10 years [4]. However, another study expects an increase more on the
level of 50% [33]. In either case, this cost is a big driver in the cost per unit
energy output from the Bloom Box fuel cell.
3.2. Fuel Cells
3.2.1. Fuel Cell Introduction
Scientists have known fuel cells for more than 150 years. They were widely
considered to be a curiosity in the late 19th century. It is now that they have gained
prominence and has been the focus of intense research and development for the
last couple of decades.
One of the first fuel cells developed was in 1838, when the renowned Welsh
lawyer turned scientist William Robert Grove developed the advanced version of
the wet-cell battery. This cell came to known as the "Grove Cell" and consisted of
a platinum electrode immersed in nitric acid along with a zinc electrode in zinc
sulfate. This cell was able to produce approximately 12 Amps of electrical current
at about 1.8 V [28].
It was Grove who discovered that by placing a couple of platinum electrodes with
one end immersed in sulfuric acid and the other end dipped in a sealed mixture of
oxygen and hydrogen, electrical current would start flowing constantly between
12
the electrodes. The sealed vessel containing the mixture would hold the water as
well as the other gases, and it was observed that the level of the water would rise
when the current started flowing [28].
Earlier in the 19th century, the process of decamping water into oxygen and
hydrogen using electrical current was described by two British scientists Anthony
Carlisle and William Nicholson. But then Grove took this a step further and
produced electrical current by combining oxygen and hydrogen. He understood
that by inserting several sets of electrodes in a serial circuit, he might "effect the
decomposition of water by means of its composition". Grove eventually able to
achieve this goal with a device he called a "gas battery". This is the first known
fuel cell [28].
A device that can generate electrical current by a controlled chemical reaction is
by definition called a fuel cell. Each such fuel cell consists of one positive and
another negative electrode. These are called as the anode and the cathode
respectively. The chemical reaction which generates electricity will occur at the
electrodes.
Each such fuel cell will also contain an electrolyte, the purpose of which is to
transport electrically charged particles from one electrode to another. Also, this
contains a catalyst, which is used to hasten the chemical reactions at these
13
electrodes. The basic fuel for these fuel cells consists of mixture of oxygen and
hydrogen.
The most attractive aspect of fuel cells is its ability to produce electricity with
almost negligible pollution. Most of the hydrogen and oxygen used by the fuel
cell will eventually combine to form water, which a very harmless byproduct by
any means.
A single unit of a fuel cell will produce a very small amount of DC (direct
current) electricity. To generate any meaningful amount of electricity, we will
need to assemble them into a stack. Whether we use it as a single fuel cell or stack
them up, the fundamental concepts of the fuel cell remain the same.
In general, fuel cells are devices that convert chemical energy directly into
electrical current and heat. They can be thought of as commercially available
batteries, which will not die down if provided with a constant supply of fuel. They
are electrochemical devices that efficiently process the chemical energy of the
fuel mixture directly into electrical current, and at the same time are much more
environment friendly than the conventional combustion-based technologies.
14
3.2.2. Fuel Cell Technology
The goal of the fuel cell is to generate electricity which can be transferred outside
the cell to power a wide array of appliances, such as powering an electric motor or
providing power to a residential neighborhood etc. Due to the behavior of
electrical current, the current generated by the fuel cell will eventually return back
to the fuel cell to complete the electrical circuit. The most important aspect of
these fuel cells is the chemical reactions that produce electricity and is the key
reason why the fuel cells work. A number of different types of materials are used
as the electrolytes and along with the working temperature differentiate the
different types of fuel cells. In general, here is how the fuel cell works – hydrogen
gas enters the cell at the anode end, at this time a chemical reaction takes place to
remove the electrons from the hydrogen atoms. This results in the hydrogen atoms
to be ionized, which is turn will transport positive electrical current. The stripped
electrons are negatively charged and generate the electrical current to be used for
actual work.
15
Formatted: Centered
Figure 2. Fuel Cell Concept Diagram. [5]
16
Formatted: Centered
Figure 3. Bloom Energy Fuel Cell Design. [5]
17
Fuel cells can work in the open atmosphere, or an unassisted environment, but
this leaves room for improvement. By operating in a pressurized environment,
called a pressurized hybrid system, efficiency can be improved.
Various types of fuel cells exists today - the most common types of fuel cells are
PEMFC (Proton Exchange Membrane fuel cell) (PEMFC); DMFC (Direct
Methanol Fuel Cell (DMFC); SOFC (Solid Oxide Fuel Cell (SOFC); MCFC
(Molten Carbonate Fuel Cell (MCFC); PAFC (Phosphoric Acid Fuel Cell (PAFC)
and AFC (Alkaline Fuel Cell (AFC).
Modern fuel cells are similar to commercially available batteries, except that they
are always running. The fuel cell technology which is the focus of our project is
different than legacy hydrogen fuel cells as follows:

Cheaper manufacturing materials – more common powder resembling sand,
rather than precious metals

Higher efficiency – nearly double some baseline models

More flexible – fuel may be renewable or fossil fuel

Reversible – energy can be generated or stored
To make these fuel cells commercially viable, multiple such fuel cell systems are
deployed in a stack or side-by-side.
18
Formatted: Line spacing: Double
Apart from the above mentioned advantages of our fuel cell, its modular design
also provides the following additional features:

Simple installation

Designed for fault tolerance

Power components modular – ability to replace one, while other run
nominally

Mobile unit can be moved easily
Formatted: Indent: Before: 0.56", Line
spacing: Double, Bulleted + Level: 1 + Aligned
at: 0.25" + Tab after: 0.5" + Indent at: 0.5",
Don't keep with next, Tab stops: 0.63", List tab
+ Not at 0.5"

Formatted: Line spacing: Double
3.2.3. Usage of Fuel Cells
Solid Oxide fuel cells have been the focus of most of the research and
development activities mainly because they use a wide array of fuels and at the
same time are very highly efficient as compared to commercial generators and
power plants. The efficiency of SOFCs is 40-60% in an unassisted environment
and can be as high as 70% in a pressurized hybrid system. The efficiency of the
power plants is in the 30-40% range. The most important aspect of the Solid
Oxide fuel cells is it adaptability to currently available fossil fuels, which in turn
drastically reduces the cost of the whole operation. Apart from SOFCs, the
various other fuel cell methodologies (MCFC, PEMFC, PAFC, AFC etc) use
hydrogen as its main fuel. This would need commercially available hydrogen gas
stations for them to have widespread usage. This is off course a very costly
19
proposition and that's why they are not very attractive at this time as compared to
the SOFCs.
Apart from its obvious advantages of using currently available fossil fuels and
being highly efficient, SOFCs are also very much in demand because they are
very clean, robust and pollution free at the same time. Since they do not have any
mobile parts, these cells are almost entirely vibration free and therefore
eliminating the noise pollution aspect associated with most commercial power
generation units. These fuel cells can be used for residential appliances, industrial
machines, hospital equipments, and at schools etc.
3.2.4. Types of Fuel Cell: Pros and Cons
The different types of fuels cells are categorized based on the type of the
electrolyte or the type of fuel used in a particular fuel cell. The following section
discusses the characteristics of the most commonly used types of fuel cells, as
well as its pros and cons.
3.2.4.1. PEMFC (Proton Exchange Membrane Fuel Cell)
Proton exchange membrane fuel cells use a solid polymer membrane as its
electrolyte at 50-120°C as its working temperature. The working temperature
for Proton Exchange Membrane Fuel Cell (PEMFC)PEMFC is relatively very
20
low as compared to the other fuel cells. It can also vary its power output
rapidly in order to meet varying power needs, thus having high power density.
Its low weight and volume contribute to PEMFC having a good power to
weight ratio. Additionally it has an efficiency of 40-60%. All these features
make PEMFC very attractive for automobile and mobility applications.
Among its drawbacks, it is very sensitive to impurities such as CO in its fuel
(CO poisoning). Also, it uses the expensive platinum catalyst (which in turns
increases the cost of the power generated) and hence we would need to lower
the catalyst for this catalyst.
3.2.4.2. DMFC (Direct Methanol Fuel Cell)
The Direct methanol fuel cell is similar to the PEMFC except that it uses
methanol as its fuel input. Its working temperature is also higher and in the
range of 90-120°C. Another interesting aspect of the DDirect Methanol Fuel
Cell (DMFC)MFC is that can store a lot of electrical power in a small
confined place, even though its power capacity is very small. These features
make DMFC very attractive for mid-sized applications or to power up the
mobile and personal gadgets.
3.2.4.3. SOFC (Solid Oxide Fuel Cell)
Hard non-porous ceramic compounds are used in the Solid Oxide Fuel Ccell
(SOFC) as electrolytes. Its high working temperature of 800-1000°C reduces
21
the requirement of needing high cost precious metal catalysts. This also makes
the SOFCs very tolerant to carbon monoxide impurities. Its efficiency is of the
order of 60 to 65%. Along with its high efficiency, it also has low cost, wide
range of fuel usage capability, no durability issues and very low emissions.
These fuel cells are widely used for small to medium scale power generation
and for stationary appliances/equipments. The high working temperatures for
the SOFCs results in it having some chemical and mechanical stability issues
along with long start up times.
3.2.4.4. MCFC (Molten Carbonate Fuel Cell)
The electrolyte used for the Molten Carbonate Fuel Cell is molten NaHCO3
(alkali carbonate mixture). It Molten Carbonate Fuel Cell (MCFC) has a very
high working temperature of 600-750°C. Its overall cost of operation is very
low since it uses low cost materials as its catalyst and it very tolerant to
impurities (carbon monoxide). It is also very efficient with an 50-60%
efficiency. Due to its very high operating temperature and its electrolyte being
very corrosive, it has a lots of problems with regards to its stability and
durability.
3.2.4.5. PAFC (Phosphoric Acid Fuel Cell)
Molten H3PO4 (phosphoric acid) is used as an electrolyte for the Phosphoric
Acid Fuel Cell. It typically operates at a working temperature of 150-200°C.
22
Due to this temperature range, the Phosphoric Acid Fuel Cell (PAFC )PAFC
is relatively more tolerant to impurities such as carbon monoxide. It can
sustain a carbon monoxide concentration of approximately 1-2%. The fuel
cells are commercially available and have 40% efficiency. PAFCs will
solidify at low temperatures (40°C) and thus require it to be operating
continuously. This makes its startup a bit difficult, thereby restricting its usage
to stationary appliances/equipments.
3.2.4.6. AFC (Alkaline Fuel Cell)
The Alkaline Fuel Cell (AFC) uses a solution of potassium hydroxide as it
electrolyte. It operating temperature is approximately 70°C. These fuel cells
can have an efficiency of high as 60-70%. Since these fuel cells can be very
easily poisoned by small traces of CO2, they operate in an environment of
pure oxygen. This results in very high cost and also restricts its usage in a very
controlled environment (underwater or aerospace equipments). AFCs have
been used to generate power and water for astronauts by NASA since the late
sixties.
The pros and cons of each type of fuel cell are summarized below.:
23
Table 1. Pros and Cons of Different Fuel Cell Technologies.
No.
1
Fuel Cell
PEMFC
(Proton
Exchange
Membra
ne Fuel
Cell
(PEMFC))








2
DMFC

(Direct
Methanol
Fuel Cell 
(DMFC))
Pros
High power density
It can vary its output quickly
to meet shift in power
demand.
Has low weight and volume
with good power-to-weight
ratio.
These characteristics make
PEMFC suitable for mobile
and automotive
applications.
The efficiency of PEMFC
ranges between 40-60%.
Low working temperature
range (50-120°C)
Quick start –up
Solid electrolyte reduces
corrosion & electrolyte
It can still store a high
energy content in a small
space
It is suitable for tiny to midsized applications, to power
cellular phones and laptops.






3
SOFC
(Solid
Oxide
Fuel Cell)
(SOFC)




SOFC uses a hard, nonporous ceramic inexpensive
compound as the
electrolyte
Operate at high
temperature (800-1000°C)
High temperature
operation eliminates the
need for precious metal
catalyst
SOFC is tolerant to CO
24

Cons
PEMFC is sensitive
to fuel impurities,
such as CO
poisoning
Expensive
platinum catalyst
Expensive cost of
its output
electricity
Formatted Table
Limited in the
power
DMFC can produce
a small amount of
power over a long
period of time.
Expensive
platinum catalyst
It requires longer
start-up time as
well as some
mechanical/
chemical
compatibility
issues
Formatted: Indent: Before: 0"
Formatted: Indent: Before: 0"
Formatted: Indent: Before: 0"




4
5
MCFC
(Molten
Carbonat
e Fuel
Cell
(MCFC))
PAFC
(Phospho
ric Acid
Fuel Cell
(PAFC)










6
AFC
(Alkaline
Fuel Cell
(AFC)



poisoning
It has high efficiencies (6065%)
Long term stability, fuel
flexibility
Low emissions and low cost
SOFC is well-suited for
stationary applications;
medium-to-large scale, onsite power generation
It has high efficiency (5060%)
Tolerant to carbon
poisoning
Able to use non-precious
metals as catalyst
Inexpensive or Cheap
Fuel flexibility
Can use variety of catalysts
It is tolerant to impurities
PAFC can tolerate a CO
concentration of about
1.5%
It has efficiency of 40% and
commercially available
widely installed in many
facilities, suited for
stationary applications
It has been used by NASA to
produce power and
drinking water for
astronauts since 1960
AFC can reach high
efficiency up to 60-70%
Cathode reaction faster in
alkaline electrolyte and
leads to higher
performance






Can use a variety of catalysts
25
It has problems
related to
durability due to
its high operating
temperature
Corrosive nature
of its electrolyte
Formatted: Indent: Before: 0"
It solidifies at a
temperature of
40°C
Making startup
difficult and
restraining PAFC
to continuous
operation
Formatted: Indent: Before: 0"
It can be poisoned
easily by small
quantities of
carbon dioxide,
that's why AFC
typically operate
on pure oxygen
(causing cost
increase)
It is very expensive
Formatted: Indent: Before: 0"
Formatted: Indent: Before: 0"
Formatted: Line spacing: Double
3.2.5. Fuel Cell Cost Components
3.2.5.1. Initial Cost
With all the obvious advantages of the various types of fuel cells, they are still
not very popular with a very small installation base. One of the main reasons
for this is the cost of the overall fuel cell system and the cost of premium fuels
used to power these cells. Originally, fuels cells were developed almost 40
years back for use in space missions. These systems were very expensive
would cost around $600K/kW and thus making it impractical for residential or
industrial usage. A lot of research and development activity has been done on
fuel cells in the last thirty years to make it more efficient and affordable for
commercial usage. Even with all this focus on fuel cells for all these years, it
is still not commercially viable as compared to other power production
systems. The most commonly used fuel cell, the newer technology, will cost
approximately $4500 per kW currently, whereas a fossil fuel generator, more
mature technology, would cost somewhere between $800 - $1500 per kW.
As is the case with most technologies, the initial cost is very high (almost
unaffordable for commercial use) but as more units are deployed along with
multiple manufacturers, the cost will most likely come down drastically. The
26
price per kW for fuel cells varies with different types of fuel cell and fuel cell
developers,developers; however most of them are expected to be about
$1500/kW eventually. The current price for these fuel cells areprice for these
fuel cells is extremely high and can only be used for specific applications
which require high reliability or where the price of conventional electricity is
very high.
3.2.5.2. Maintenance Cost
The maintenance cost of these fuel cells is expected to be very low. Periodic
once a year inspection and servicing would be required by the fuel supply
systems. The fuel cell assembly will probably not need any maintenance
activity for its total life cycle. Having said all this, we still need to determine
the overall reliability and serviceability of these systems in a large and long
duration deployment scenario. The day-to-day cost of maintaining these fuel
cells are expected to be somewhere in the range of $0.005 - $0.01 / kWh.
27
Formatted: Line spacing: Double, Keep with
next, Keep lines together
3.2.5.3. Incentives
Apart from all the ongoing rR&Desearch and development activities to make
fuel cells more affordable, the federal government is also provide tax
incentives for fuel cell power plants and to users of these fuel cell systems.
The Energy Policy Act of 2005 allows the fuel cell power plants to claim tax
benefits from the Federal government. In order to qualify for these tax breaks,
the power plants should have a fuel cell stack assembly to generate electricity
using electro-chemical reactions. Additionally they should have an efficiency
of 30% or greater. A number of states are also providing financial incentives
to support fuel cell installation facilities. Fuel cell power consumers are also
able avail 1.5 cents per kWh credit for the first 5 years since they started using
this service. Although the above tax and financial incentives do not reduce the
cost of the manufacturing and generating power using fuel cells, they do lower
the operating costs for both the supplier and the electricity users.
The following table gives us a quick snapshot of how the some of the most
commonly used fuel cells compare with each other from a cost per kW
perspective.
28
Formatted: Line spacing: Double
Formatted: Keep with next, Keep lines
together
Table 2. Fuel Cell Costs: Price per kW [32]
Fuel Cell
Type
PEFC
(200kW
System)
SOFC
(100kW
System)
PAFC
(200kW
System)
Package
Cost ($/kW)
Total Installation
Cost($/kW)
Operating and
Maintenance cost
($/kW)
3120
3800
0.023
2850
3620
0.024
4500
5200
0.029
The following table shows the most recent cost estimates of fuel cells in terms of
Formatted Table
Formatted: Keep with next, Keep lines
together
Formatted: Indent: Before: 0.5", Line
spacing: Double
$/kWh.
Formatted: Font: Not Italic
Table 3. Fuel Cell Costs: Price per kWh [32]
Formatted: Font: (Default) Calibri, Bold
Fuel Cell
Price ($/kWh)
Formatted: Font: (Default) Calibri, Bold
Formatted Table
Phosphoric Acid Fuel Cell (PAFC)
1 MW:, 0.1245 $/kWh
Formatted: Font: Bold
Formatted: Font: (Default) Calibri, Bold
Proton Exchange Member Fuel
Cell (PEMFC)
Molten Carbonate Fuel Cell
(MCFC)
0.25 MW:, 0.1048 $/kWh
Formatted: Font: Bold
Formatted: Font: (Default) Calibri, Bold
20 MW: , 0.1084 $/kWh
Formatted: Font: Bold
Formatted: Font: (Default) Calibri, Bold
3 MW:, 0.0895 $/kWh
Solid Oxide Fuel Cell (SOFC)
Formatted: Font: Bold
Formatted: Font: (Default) Calibri, Bold
29
Solid Oxide Fuel Cell +
GT Hybrid (SOFC-GT)
5 MW:, 0.0954 $/kWh
In summary, fuel cells have the potential to revolutionize our lives in a similar
fashion as the microprocessor has been. Once we have figured out a way to make
these fuel cells commercially affordable, this power source will change our world
and improve the quality of our lives by reducing the environmental degradation
caused by combustion engines.
3.3. Solar Energy
3.3.1. Solar Energy Introduction
"Solar energy is considered as the most abundant energy resource on earth. The
solar energy that hits the earth's surface in one hour is about the same as the
amount consumed by all human activities in a year. As global warming continues
to threaten our environment, there seems little doubt that solar power will become
an even more important form of renewable energy in future." [29]
Solar power is produced by collecting sunlight and converting it into electricity.
This is done by using solar panels, which are large flat panels made up of many
individual solar cells. It is most often used in remote locations, although it is
becoming more popular in urban areas as well.
Solar radiation is an integral part of different renewable energy resources. It is the
main and continuous input variable from practically inexhaustible sun. Solar
energy is expected to play a very significant role in the future especially in
30
Formatted: Font: Bold
Formatted: Font: (Default) Calibri, Bold
developing countries, but it has also potential prospects for developed. Another
future perspective use of solar energy is its combination with water and as a
consequent electrolysis analysis generation of hydrogen gas, which is expected to
be another form of clean energy sources. Combination of solar energy and water
for hydrogen gas production is called solar-hydrogen energy. [25]
3.3.2. Types of Solar Energy
There are many types of solar energy. The two most common ways to categorize
solar energy are: depending on how it is converted into useful energy and type of
energy it is converted into the solar energy.
In the first way, solar energy can be converted into two types: passive and active
solar energy.
3.3.2.1. Passive Solar Energy
Passive solar energy refers to the harnessing of the sun's energy without the
use of mechanical devices. Using south-facing windows to provide natural
lighting and heat for your home are examples of passive solar energy.
3.3.2.2. Active Solar Energy
Active solar energy uses mechanical devices in the collection, storage, and
distribution of solar energy for your home. For example, in active solar energy
water heating systems, pumps are used to circulate water through the system.
31
Additionally, there are three types of active solar energy.
Solar Thermal Energy -: is the energy created by converting solar energy
into heat. Several applications that take advantage of this type includes solar
space heating, solar water heating, solar pool heating, and solar thermal
heating.
Photovoltaic Solar Power -: is the energy created by converting solar
energy into electricity using photovoltaic solar cells.
Concentrating Solar Power - : is a type of solar thermal energy that is used
to generate solar. This technology is aimed at large-scale energy production.
Because of this, as a homeowner, you won't use concentrated solar
power directly, but could take advantage of it through a green-pricing service
offered by your regulated utility or an alternative energy supplier.
3.3.3. Solar Energy Pros and Cons:
There are many advantages and disadvantages using the solar energy. When
evaluating the pros and cons, one should look into the usability factor,
environmental factor and the requirement factors of the solar energy systems. The
pros and cons of solar energy in general are shown in Table 4.:
Table 4. Pros and Cons of Solar Energy.
Solar Energy Pros
Solar Energy Cons
32








Solar panels give off no pollution
excluding the pollution produced
during manufacturing the solar
panels.
The production of power from solar
energy is quiet compared to other
renewable energy like fossil fuels.
One of the great pros of solar
energy is the ability to harness
electricity in remote locations that
are not linked to a national grid. A
prime example of this is in space,
where satellites are powered by
high efficiency solar cells.
Solar energy providers give costeffective installation in remote
areas
Solar energy can be very efficient in
a large area of the globe, and new
technologies allow for a more
efficient energy production on
overcast/dull days.
Solar panels can be installed on top
of many rooftops, which eliminate
the problem of finding the required
space for solar panel placement.
Although the initial investment of
solar cells may be high, once
installed, they provide a free source
of electricity, which will pay off over
the coming years.
The use of solar energy to produce
electricity allows the user to
become less dependent on the
worlds fossil fuel supplies.
33




The major con of solar energy is
the initial cost of solar cells.
Currently, prices of highly efficient
solar cells can be above $1000,
and some households may need
more than one. This makes the
initial installation of solar panels
very costly.
Solar energy is only able to
generate electricity during
daylight hours. This means for
around half of each day, solar
panels are not producing energy
for your home.
The weather can affect the
efficiency of solar cells.
Pollution can be a con of solar
energy, as pollution levels can
affect a solar cells efficiency, this
would be a major con for
businesses or industry wishing to
install solar panels in heavily
polluted areas, such as cities
3.3.4. Classification of Ssolar Ppanels
Solar panels are used widely and are the most important component in the solar
energy systems. It converts sunlight into electric energy and outputs the direct
current into batteries.
Solar components mainly constitutes of different sized solar cells also known as
solar array. The solar cells are also called as PV cells. The solar power is related
to the solar cells. If the area is large then the capacity of producing power is
more. The solar cells are generally made either from crystalline silicon, sliced
from ingots or castings, from grown ribbons or thin film, deposited in thin layers
on a low-cost backing.
There are many types of solar panel technologies available in the market. The
main types are:
Crystalline silicon technology.: Crystal cells are made up from thin single crystal
of silicon (monocrystalline) or from a block of silicon crystals (polycrystalline),
their efficiency ranges between 12% and 17%. This is the most common
technology representing about 90% of the market today [9].
34
Thin Film technology.: Thin film modules are constructed by depositing
extremely thin layers of photosensitive materials onto a low-cost backing such as
glass, stainless steel or plastic.
There are for types of thin modules which are commercially available in the
market: Amorphous silicon (a-Si), Cadmium telluride (CdTe), Copper
Indium/gallium Diselenide/disulphide (CIS, CIGS), Multi junction cells (a-Si/mSi).
Table 5 shows sSome of the important and most widely used solar cell
technologies and their efficiency are.:
Table 5. Summary of Solar Cell Technologies [9]
35
3.3.5. Photovoltaic Solar Cells
Direct conversion of sunlight into electricity in Photovoltaic (PV) cells or solar
cells is one of the three main solar active technologies, the two others being
concentrating solar power (CSP) and solar thermal collectors for heating and
cooling (SHC) [29]. Photovoltaic (PV) is a method which converts direct sunlight
into electricity using variety of different sized solar cells, also known as PV cells.
Today, PV provides 0.1% of total global electricity generation. However, PV is
expanding very rapidly due to dramatic cost reductions. PV is a commercially
available and reliable technology with a significant potential for long-term growth
in nearly all world regions [29].
It is been predicted that PV will provide 5% of global electricity consumption in
2030, rising to 11% in 2050 [29]. If the PV industry gets more concerted policy
support from the government. Sustained, effective and adaptive incentive schemes
are needed to help bridge the gap to PV competitiveness, along with a long-term
focus on technology development that advances all types of PV technologies,
including commercially available systems and emerging and novel technologies
[29].
3.3.6. Market Eend-uuse Ssectors
According to Technology Roadmap, there are four end-use sectors with distinct
markets for PV:
36

Residential systems are (typically up to 20 kW systems foron individual
homes.)

Commercial systems are (typically up to 1 MW systems for commercial
office buildings, schools,

hospitals, and retail.)

Utility scale systems are (starting at 1 MW, mounted on buildings or
directly on the

Ground.)

Off-grid applications are (varying in sizes.)
3.3.7. Solar Energy Costs
The solar energy industry typically uses price per Watt Peak (Wp) as its primary
unit of measurement. The prices for high power band (>125 watts) solar modules
has dropped from around $27/Wp in 1982 to around $4/Wp today. Prices higher
and lower than this are usually dependent upon the size of the order. [25]
The solar module represents 40%-50% of the total installation cost of the Solar
Electric Systems. The total installation costs is calculated depending upon the
type of solar systems, where the energy feed is going in to the grid or off the grid.
The average price of the solar electricity is around 30 cents/kwh (kwh, a measure
which takes account of solar conditions).
37
The calculation of kWh is done depending on the location of the solar installation
and the local electricity tariff rates. Then in order to determine what proportion of
total energy solar will provide, one has to take in to account the size of the solar
energy system and the energy demand of the customer. [25]
Typical kWh usage by homes in three selected US average homes is shown
below. For example, in a Sacramento, California home, it would cost around $16$20,000 (depending on 8,000 -10,000 above that you may change) to satisfy
around 25% of that homes energy needs.
Grid-connected PV is the fastest growing segment in the solar industry market in
the Unites States because of its cost-effective parameter.
The cost of Solar Power from Photovoltaic Cells, according to the U.S department
of energy, arecost of Solar Power from Photovoltaic Cells, according to the U.S
38
department of energy, is illustrated in Figure 4, Figure 5, and Figure 6.
Figure 4. PV System Efficiency. [5]
Figure 5. PV System Capital Cost [5]
39
Figure 6. PV Cost of Energy [5]
3.3.8. Solar Energy Maintenance Costs
Maintenance will need to be estimated separately, and the lifetime of the systems
is not addressed in this data. Most resources report that maintenance costs are
low, about 0.1 cents/kWh [25]. Studies show a maintenance cost proportional to
equipment size and predict operating and maintenance costs of about 1% of the
installation price [25]. The following charts show the recent decrease and leveling
off of the price to purchase and install solar power equipment. Many systems are
rated for use for 20 years or more, so replacement costs are not included.
3.4. Total Current Cost Summary
The following is a summary of the current average cost of the three types of
electricity.
40
Table 6. Current Energy Cost Summary.
Typical
Installation
Size
Energy
Source
Cost per
kilowatt peak
($/kWp)
Cost per
kilowatt hour
(¢/kWh)
Solar Power
1-100 kW
6,000-10,000
20-40
Fuel Cells
1-200 kW
3,000-4,000
10-15
Electric
Company
N/A
N/A
8-9
Typical Use
Baseload power
source. Off grid
residential, remote
industrial
applications
Baseload power
source. Off grid
residential.
Transportation
Baseload power
source. Primary
residential and
commercial
Energy
Source
Typical
Installation
Size
Cost per
kilowatt peak
and per
kilowatt hour
Dispatchable?
Typical Uses
Solar Power
1-100
kilowatts
$6K - 10K per
kWp or 20-40
cents per kWh
No
Baseload power source. Off
grid residential, remote
industrial applications.
Fuel Cells
1-200
kilowatts
$3K - 4K per kWp
or 10 - 15 cents
per kWh
Yes
Baseload power source. Off
grid residential.
Transportation.
Electric
Company
N/A
8-9 cents per
kWh
No
Baseload power source.
Primary residential and
commercial.
41
4. Cost Analysis Formulation
In this study, cost analysis is based on current market values for the price of electricity,
solar panels, and natural gas. The Bloom Energy fuel cell is not yet ready for market on
the residential level, never the less cost analysis is formulated including the Bloom Box
to show what the cost comparison would be if it hit the market now on that level. For
future release dates, the analysis can be rerun using future values, simply by updating the
inputs.
Reports showed that an average monthly use of electricity for a typical US residential
user is approximately 920 kWh [26]. Estimates for the size of solar panel(s) and fuel cell
are based on this average value. Furthermore, in purchasing electricity from the electric
company, we have based the average monthly cost on this amount as well. We found that
most costs are estimated based on the size of the equipment, so the total cost would scale
linearly with an increase or decrease of total energy requirements. Therefore, we would
not expect a very large dependence of the results on the selection of this value.
A period of 10 years is being selected to do our cost analysis. Both solar panels and fuel
cells have the potential to be in service for a period longer than 10 years, so a
replacement cost will not be included. However, an annual maintenance cost is estimated
for both the Bloom Box and the solar equipment. Furthermore, since the lifetime for the
equipment is longer than the 10 year analysis period, a salvage value based on
depreciation will be considered in the formulation.
42
4.1. Return On Investment Selection
In reviewing various equipment replacement Return on Investment (ROI)
descriptions, we identified a range of typical values. More specifically, Black [3]
claimed that solar electricity can generate rates of return of 11-20%. Furthermore, the
American Machinist [15] showed the following quote, "When the financial
department looks at the cost justification for a new piece of equipment it usually
wants to see a return of at least 15 percent." We are interested in the range of 10-20%
ROI in reference to the latter ROIs.
In the final results, we are planning to list the 15% interest rate calculation as our
main result, but also vary the interest rate (using 10% and 20%) as a measure of how
sensitive the results are to a different choice of interest rate.
4.2. Analysis Cases
For each cost analysis, we have a baseline case that represents our best estimate of the
annual cost of electricity generation for each of the three methods under
consideration. However, since many of the input parameters involve estimating costs
or forecasting prices in the future, there is some uncertainty associated with the
analysis. Therefore, it is important to look at different "what-if" cases to determine
the dependence of the results on each individual input parameter.
43
We use an upper and lower estimate for each input parameter as well. These represent
the range of values for a given input. We do the annual cost estimate varying each
input individually, as well as estimating best-case and worst-case scenarios. The bestcase scenario for the Bloom Box, for example, uses all of the input variations that
would provide the lowest possible annual cost for Bloom Box electricity.
These what-if cases show how much the annual cost varies with each input parameter.
This information is valuable to Bloom Energy in indicating what areas pose the most
risk for being competitive with the price of electricity. For example, if the
maintenance cost has a larger total effect on the cost of electricity generation than the
purchase price, then Bloom Energy might want to focus on reliability rather than
putting effort into making small decreases in purchase price. There are inevitably
tradeoffs during the design and development phases of new technology, and this cost
analysis helps pin point the most important design areas.
44
4.3. Bloom Box Cost Analysis
4.3.1. Bloom Box Purchase Price
The purchase price for the Bloom Box fuel cell comes from the design goal that
Bloom Energy has specified for its residential unit. They have set the goal to sell
an average residential fuel cell for $3,000. This is the baseline value for our cost
comparison equations. We are including the federal tax credit of 30%, which
reduces this input to $2,100. This credit would be available for purchasing a
Bloom Box, and it is a direct saving for customers. It is possible that Bloom
Energy could either do better or worse than their goal, so it is important to test at
higher and lower values as well. We are testing the range of 10% below and
above the target price as well.
4.3.2. Bloom Box Installation Cost
Although Bloom Energy claims that the Bloom Box is different from other fuel
cells in that it has higher efficiency and a lower purchase price, the technology
used to transmit electricity from the Bloom fuel cell to the building is essentially
the same. Therefore, the work required to install a Bloom Box is expected to be
comparable to the installation for other fuel cells, especially solid oxide fuel cells.
We estimate the baseline installation cost using a comparable fuel cell.
From literature review, a comparable fuel cell with a purchase price of $2,850
cost $770 to install. As a fraction of purchase price, the installation is 27% of the
45
purchase price. We use that fraction to estimate our installation cost of $810, or
27% of our $3,000 purchase price. We also reduce the installation price by 30%,
because the federal tax credit for fuel cells includes the installation price.
4.3.3. Natural Gas Fuel Cost
The current commercial Bloom Box uses 0.661 MMBtu/hr of natural gas to
generate 100 kW of electricity. The amount of natural gas used by a residential
unit will scale linearly with the size of the unit and amount of electricity
generated, so we estimate the amount of natural gas required by scaling linearly
from the 100 kW usage.
Our monthly electricity use estimate is 920 kWh, based on average household
electricity use. Since fuel cells can generate electricity continuously and store
electricity, we assume that the fuel cell will run for 24 hours a day. Based on the
average monthly electricity demand and a full-time generation schedule, 1.26 kW
are needed for an average residential Bloom Box.
For a residential Bloom Box, 6.08 MMBtu of natural gas are required monthly.
The current price of natural gas is $10.63 per MMBtu, so the estimated annual
cost of natural gas to run the Bloom Box is $775.
46
4.3.4. Price Trend of Natural Gas
The price increase for natural gas fits well to a linear trend. Therefore, we are
using a linear gradient increase of 3%. The forecast for natural gas prices is
provided by the U.S. Energy Information Administration's annual report for 2011.
The full report has not yet been released at the time of this analysis, but an
executive summary along with electricity and other energy source price forecasts
has already been published [34].
4.3.5. Cost of Bloom Box Maintenance
In our literature review, we found that the expected maintenance costs for fuel cell
can be estimated based on amount of electricity generated. The value quoted is
approximately 2.4 cents per kWh, so the monthly maintenance cost in our analysis
is expected to be around $22. This gives an annual maintenance cost of $264.
4.3.6. Bloom Box Salvage Value
Well maintained fuel cells can last for more than ten years, so there is a salvage
value for the Bloom Box calculation. We are assuming, in our maintenance
calculations, that preventative maintenance is used to keep the fuel cell running
optimally and that the Bloom Box is designed to last for 20 years. Since we are
assuming the fuel cell will provide a constant amount of electricity throughout its
lifetime and it will not actually be sold at the end of 10 years, it is most
representative to spread its value out evenly over the 20 year lifetime. This is best
47
described using Straight-line depreciation. Using this depreciation method and the
initial purchase price of $3,000, the salvage value at the end of our 10 year
analysis period is $1,500.
48
4.3.7. Bloom Box Cost Estimation Equations
4.3.8.4.3.7.
49
4.4. Solar Panel Cost Analysis
4.4.1. Solar Panel Purchase Price
In our literature review, we found that the current estimate for the purchase price
of solar panels is estimated at $2,000 per kW of electricity generation. We
estimated that a typical household would need 6.05 kW of electricity generation
potential with an average period of peak sunlight of 5 hours per day to produce
the 920 kWh of electricity per month. This gives an estimated purchase price for
solar panels of $12,000. There is also a federal tax credit on solar panels of 30%,
so that reduces the value to $8,400 in our cost analysis.
4.4.2. Solar Panel Installation Cost
The solar panel installation estimate is based on the size of the solar equipment. It
is estimated that the installation costs for solar panels is approximately the same
as the purchase price of the panels. Therefore, our estimate is $12,000, however,
the federal tax credit applies to installation costs as well, so the baseline value is
also reduced to $8,400.
4.4.3. Cost of Solar Panel Maintenance
The maintenance cost for solar panels is relatively low, estimated at 0.1 cents per
kWh. Using our baseline value of 920 kWh per month, the estimated solar panel
monthly maintenance cost is about $1 per month, or $12 annually.
50
4.4.4. Solar Panel Salvage Value
Solar panels have an average lifetime of 20 years, so we use a salvage value for
the end of our 10 year analysis period. We use a Straight-line depreciation to
estimate the salvage value, so our baseline estimate is 50% of the purchase price,
or $6,000.
51
4.4.5. Solar Panel Cost Estimation Equations
52
4.5. Electric Company Cost Analysis
The only cost input that is required for the cost of electricity calculation is the price of
purchasing electricity, per kWh, from the utility company. The U.S. Energy
Information Administration provides a forecast for the price of electricity for each
year, for more than the 10-year period that we are studying [34]. Much effort has
already gone into incorporating the most significant factors in electricity cost
prediction by this agency, so this is used as our estimate for electricity cost. We found
that a linear increase approximation to the next ten years of forecasted electricity
costs describes the data well, so we are using the current cost of electricity as an
initial price and a linear increase rate of 2% per year. This is used in the gradient
formula during the cost estimate analysis.
In addition to this best estimate for electricity price, the agency has also estimated the
dependence of the cost of electricity based on economic growth. They have predict
that if the economy slows down, the rate of increase will be reduced to a level of
about 1%, instead of 2%. Furthermore, a higher rate of economic growth is expected
to produce a higher increase rate of about 3%. So, these values are used in the what-if
analysis as well.
53
4.5.1. Electric Company Cost Estimation Equations
5. Results and Discussion
5.1. Baseline Cost Estimate
The baseline case represents the best estimate for the annual cost of electricity for
each source. The results for this case are shown in Table 7 below.
Table 7: Baseline Annual Electricity Cost Results
Baseline Annual Cost
(ii = 0.15, n = 10)
Bloom Box
$1,575
54
Electric Company
Solar Panels
$1,297
$3,064
Our baseline results show that the cost of electricity from the electric company is still
cheaper than the Bloom Box given our assumptions. The annual cost of electricity for
the Bloom Box is estimated at $1,575, and the cost of solar and electric company are
$3,064 and $1,297 respectively. The results are also shown in Figure 7.
Baseline Annual Electricity Cost (i = 0.15, n = 10)
$3,500
$3,064
Annual Cost ($)
$3,000
$2,500
$2,000
$1,575
$1,297
$1,500
$1,000
$500
$0
Bloom Box
Electric Company
Solar Panels
Electricity Source
Figure 7: Baseline Annual Electricity Cost Results
5.2. Minimum and Maximum Cost Estimates
Due to uncertainty in the input parameters, we have also varied the inputs by a fixed
amount of 10%. The results shown in Table 8 show the minimum and maximum costs
55
with all input parameters either increased or decreased by 10% to yield a minimum or
maximum cost.
Table 8: Minimum and Maximum Annual Cost Results
Annual Cost - Min/Max
(i = 0.15, n = 10)
Minimum
Bloom Box
$1,403
Electric Company
$1,167
Solar Panels
$2,698
Maximum
$1,748
$1,426
$3,429
In this analysis, even the best-cast scenario for solar yields a $2,698 annual cost
where the worst cases for the Bloom Box and electric company are $1,748 and $1,426
respectively. Therefore, the discussion of results focuses less on a comparison with
solar panels than with the more competitive comparison between the Bloom Box and
the electric company. There are parts of the country where solar energy is cheaper
and a more competitive option, for example, California has additional state subsidies
that help lower the cost of solar energy. Furthermore, there are climate factors, such
as amount of available sunlight that also reduce the cost of solar in some parts of the
country. However, this analysis focuses on the average case over the whole United
States, so we focus less on the specifics of local regions.
The comparison of the Bloom Box with purchasing electricity from the electric
company is more competitive and will likely present the largest challenge to Bloom
Energy. The $1,403 best-case scenario for the Bloom Box does represent a cost
savings over the worst-case scenario for the electric company of $1,426. Furthermore,
56
using the 3% increase rate for the price of electricity from the high economic growth
case brings the worst-case price of electricity to $1,471, which is even closer to the
baseline Bloom Energy cost. These results indicate that Bloom Energy does have a
chance to compete with electricity companies, but also that it is important to focus on
areas for improvement to increase the chances of success. Some options for reducing
the cost of electricity generated by a Bloom Box are reducing the purchase price or
maintenance costs. If the cost of natural gas goes down in the future, this will also
introduce a greater chance that Bloom will be able to succeed as well, but this is not
necessarily something that Bloom has any control over.
5.3. Individual Input Parameter Dependence
In an effort to identify the most critical cost components for each source of electricity,
we vary each input parameter, one at a time, by a fixed amount of 10%. The results of
this analysis for the Bloom Box case are shown in Table 9 below. The decrease and
increase columns show the annual cost if the input parameter is decreased by 10% or
increased by 10%. The columns labeled "Percent DifferencePct Diff" show the
increase or decrease as a percentage of the baseline annual cost.
Table 9: Bloom Box Single Input Variation Cost Analysis Results
Bloom Box Cost - Varying Individual Parameters
Baseline Annual Cost = $1,575
Percent
DifferencePct
Input Parameter
Decrease
Diff
Increase
P_b_pur
$1,533
-2.66%
$1,617
57
Percent
DifferencePct
Diff
2.66%
P_b_inst
A_b_fuel_init
G_b_fuel
A_b_rpr
S_b
$1,564
$1,498
$1,567
$1,549
$1,568
-0.72%
-4.92%
-0.50%
-1.68%
-0.47%
$1,587
$1,653
$1,583
$1,602
$1,583
0.72%
4.92%
0.50%
1.68%
0.47%
Since it is the change in cost of electricity that we are interested in, the salvage value
is varied so that the cost of electricity will increase or decrease. For example, in the
decrease column in Table 9, the salvage value is actually increased, resulting in an
electricity price decrease.
By varying the inputs in the what-if analysis, each by 10%, the largest annual Bloom
Box cost difference in both the minimum and maximum cases results from varying
the cost of natural gas. This indicates that the price of natural gas has the largest
effect on the cost of using a Bloom Box for electricity generation. While it is the
current price of natural gas that is used as an input, varying its value has significance
for two reasons. One, this analysis focuses on the case where the Bloom Box is
released today. However, it will actually be released in the future, and it will be the
current price of natural gas when the Bloom Box is released that will help determine
its success. Two, the gradient line that is used in the TVM equations is represented by
an initial cost and a linear trend. That line is an approximation of ten data points, and
if the cost changes in the future, the average value of the line can increase or decrease
in addition to the slope changing.
58
The percentage of each component of the total cost is shown in Figure 8, excluding
the salvage value, since it is a negative value.
Bloom Box Cost Components
Maintenance
16%
Purchase
25%
Installation
7%
Purchase
Installation
Fuel
Maintenance
Fuel
52%
Figure 8: Bloom Box Cost Components as a Percentage of Total Cost
Both of these analyses show that the cost of electricity from a Bloom Box relies most
heavily on the cost of natural gas.
The results for the electric company are shown in Table 10.
Table 10: Electric Company Single Input Variation Cost Analysis Results
Electric Company Cost - Varying Indivual Parameters
Baseline Annual Cost = $1,297
PercentPct
Input Parameter
Decrease
DifferenceDiff
Increase
A_e_init
$1,175
-9.37%
$1,418
G_elec
$1,288
-0.63%
$1,305
59
PercentPct
Difference
9.37%
0.63%
In the cost of electricity estimation, the variation of the initial price by 10% causes a
larger change in the minimum and maximum annual cost of electricity than changing
the slope by 10%. This indicates that the initial price plays a larger role in
determining the annual cost of electricity from a time value of money standpoint. The
results for solar panels are shown in Table 11.
Table 11: Solar Panel Single Input Variation Cost Analysis Results
Solar Panel Cost - Varying Individual Parameters
Baseline Annual Cost = $3,064
Percent
DifferencePct
Input Parameter
Decrease
Diff
Increase
P_s
$2,897
-5.46%
$3,231
C_s_inst
$2,897
-5.46%
$3,231
C_s_rpr
$3,063
-0.04%
$3,065
Percent
DifferencePct
Diff
5.46%
5.46%
0.04%
5.4. Varying ROI
The following cases use different values for the Return on Investment (ROI) input
parameter to show the dependence of the results on our choice of this input. The
results for 10% ROI are shown in Table 12.
Table 12: Annual Electricity Cost with 10% ROI
Annual Cost - Varying ROI
(i = 0.1, n = 10)
Bloom Box
$1,437
Electric Company
$1,305
Solar Panels
$2,370
60
The results for 20% ROI are shown in Table 13.
Table 13: Annual Electricity Cost with 20% ROI
Annual Cost - Varying ROI
(i = 0.2, n = 10)
Bloom Box
$1,665
Electric Company
$1,289
Solar Panels
$3,788
In both of the varied ROI cases, the electric company annual cost is the lowest.
However, in the 10% ROI case, the cost difference between the Bloom Box and
electric companies is smaller than the baseline case. The percentage difference
between the annual cost of the Bloom Box and electric company is shown in
Table 14 for each of the ROI inputs.
Table 14: Annual Cost Difference Varying ROI
Annual Cost Percent Difference
Between Bloom Box and Elec Company
ROI
% Difference
10%
9%
15%
18%
20%
23%
In the 10% ROI case, the annual cost for the Bloom Box is 9% higher than the
electric company cost, where the difference is 18% for the baseline case with a
15% ROI. The 20% ROI case yields a 23% cost difference, showing that the
lower the ROI, the smaller the difference is between the Bloom Box and electric
company costs.
61
5.5. Bloom Box Cost Strategy
In an effort to identify strategies for Bloom Energy to maximize price
competitiveness in a comparison with electric companies, we investigated possible
cost reduction alternatives. The results are discussed in this section.
5.5.1. Bloom Box Purchase Price Importance
After identifying that Bloom Energy will need to find ways to reduce costs in
order to increase its chances of success, we tested different values for the
reduction in purchase price. In order to reduce the expected cost of electricity
from a Bloom Box to the $1,297 baseline value of electricity, a purchase price
reduction of about 67% is required. This is a considerably large reduction in price,
and may be unreasonable, especially if other cost reduction methods are more
effective.
5.5.2. Bloom Box Maintenance Cost Importance
If Bloom energy is able to offer a warranty that covers the maintenance costs, the
cost of electricity using a Bloom Box is reduced to $1,311, requiring less than
10% reduction in purchase price in order to beat the electricity companies in the
baseline case. Furthermore, if the price of natural gas decreases by a level of 20%
from the current predictions, only a 50% reduction in maintenance costs would be
required to beat the electric companies.
62
5.5.3. Government Subsidies
While a reduction in natural gas price could come naturally, another option is
government subsidies. Currently, the solar industry is helped greatly by
government subsidies, especially in California. If governments decide to pursue
fuel cells as a technology that is worth promoting, subsidizing natural gas is one
of the alternatives. For example, if the government subsidizes natural gas costs by
35%, no reduction in maintenance cost or purchase price is required to reach a
Bloom Box electricity cost of $1,276, which is a cost savings over the baseline
electric company price.
This might offer a more attractive option for governments looking to make a
move toward clean energy. Currently solar power benefits from government
subsidies in California, but other regions are limited by cloudy weather and
seasons. However, there are no climate limitations for fuel cells, so local and state
governments around the country can consider the option to support Bloom Energy
fuel cells by offering subsidies on natural gas.
63
Formatted: Indent: Before: 0"
Formatted: Line spacing: Double
6. Economic Justification
Comment [LPW1]: Check the slides. You have
not included all of the required sections in the
executive summary.
6.1. Executive Summary
Our Company and Products
Our company seeks to help shape the future of clean energy. There are numerous
different clean energy technologies currently in development, but progress requires
investment, whether from private investors or government support. Identifying which
technologies are the most viable for the future is a large effort, but this information
helps direct funding to the optimal technologies. Using our analysis, customers can
avoid spending time and money evaluating numerous investment options as well as
avoiding poor investments. We will form a research and analysis firm that produces
reports on relevant clean energy topics.
Our first product is a research analysis report entitled "Cost Analysis Comparison of
Bloom Energy Fuel Cells with Solar Energy Technology and Traditional Electric
Companies". The project objective is to compare the Bloom Energy fuel cell, an
emerging technology, with other energy sources and produce effective analysis that
can be used to decide the future source of energy. This study includes an analysis of
the Bloom Energy solution and shows how it can fulfill energy needs while, at the
same time, helping keep the environment clean. The Bloom Energy solution is
designed to be reliable, very clean, and low cost, compared to competitors.
64
Green Technology Analysts Company<your company name> provides energy research
analysis consulting services to the business and investment community. We assess the
viability and characterize the strengths and limitations of emerging energy related
technologies and strategies. We help reduce the need for businesses and investors to
identify optimal energy energy alternatives and investment opportunities.
Problem Statement
It is difficult to predict what clean energy technologies currently in development will be
successful in the future. It is vital to identify which companies have the most potential,
before investors decide on large investments.
Our Solution
Our company helps to solve this problem by conducting the technical research and
analysis that allows a clear and direct comparison of emerging technologies. Whether it is
accurately defining the current state of a product or forecasting into the future, we
highlight the important results in making effective cost analysis comparisons.
Value Statement
The cost of the research and analysis, without including the cost of running the company,
can exceed $25,000, yet we will sell our reports for under $2000. Therefore, companies
that purchase our products will save over $20,000 in research costs per report.
65
Customer Base
Formatted: Line spacing: Double, Keep with
next, Keep lines together
Our potential customers include companies looking for information to help make wise
Formatted: Indent: Before: 0.25", Line
spacing: Double, Keep with next, Keep lines
together
investments in energy research and development. We will also sell to technology
companies deciding on which new projects to pursue. Finally, we will also sell reports to
government agencies that require energy research to help in designing clean energy
legislation.
Formatted: Line spacing: Double
Market Size
The size of the energy technology consulting market is estimated at $2.85 billion
annually [23]. TGreen technology for producing clean energy has proven to be a
significant business opportunity, and it is growing rapidly, even beating other early
technology revolutions like telephony, computers, and the Internet [10]. The funding for
energy development is necessary to support the growing market for clean technology.
This has led to the emergence of new markets for energy and the growth of de-centralized
generation and distribution systems. Within this context, the use of a clean technology,
such as fuel cells, as a generator of electricity for the residential market, is a significant
market opportunity. In order to support the growing market for clean technology,
investment in research is necessary. As an example, the total venture capital investment
in clean energy in 2010 was $7.85.1 billion [16]. Additionally, the Department of Energy
recently supplied a $1.4 billion loan to a single clean energy company, BrightSource [16].
Comment [LPW2]: Start by saying something
like, …” The energy technology consulting sector
represents a <$X> billion dollar business
opportunity.” Then back up your statement with a
few examples or references.
Formatted: Font: Bold
Competitors
66
There is a growing number of competitors in the market, but our plan puts us in a
strategically beneficial position, because we streamline the analysis efforts and supply
our reports at a lower cost. Some technology consulting companies, like Markets and
Markets, sell their analysis reports for more than double our price.
Formatted: Indent: Before: 0.25", Line
spacing: Double
Formatted: Line spacing: Double
Startup Cost and Payoff
We are estimating an initial startup cost of $24,000 for our company, with additional
$250,000 investment over the first 1.5 years. We seek an initial investment funding of
$275K for the first year and a half of operating expense and growth. We do not anticipate
additional funding after the initial investment period because of $1 million in anticipated
net profit in the subsequent year. The investment funds will be used to hire the
management, technical, and administrative staff < major positions you plan to fill>, and
to cover startup, legal, and utility costs required up to the break-even point.
Formatted: Font: Bold
Break-Even Point
Formatted: Font: Bold
We expect our break-even point to occur during the fourth quarter of 2012, at which point
we will have sold approximately 600 reports. This includes the first report, as well as one
follow-on analysis report every six months.
Formatted: Font: Bold
Revenue at Three Years
At the end of year three, we expect to reach a cumulative revenue of nearly $3 million,
which will yield an estimated cumulative profit of just over $1 million to that point. Our
annual revenue at that point is projected at $1.7 million.
67
< state other major expense itemsThis will cover our maximum cumulative loss,
explained in more detail below, until we reach our break-even point after at the 1.5 year
point. At that point, we will have sold 600 copies of research papers and will have made
up for all of our losses. One year later, we expect to have a $1 million profit.
Formatted: Indent: Before: 0.25", Line
spacing: Double
Management Team
The management team consists of 3 managers from San Jose State University. These
managers are from multi-cultural and multidisciplinary backgrounds. Together they fill
Comment [LPW3]: Usually you talk about the
experience of key individuals you plan to hire. You
want to convince the reader that you are pulling
together a strong and experienced management team.
Formatted: Indent: Before: 0", Line spacing:
Double
Formatted: Line spacing: Double
the rolls of Chief Executive Officer, Chief Technology Officer, and Chief Marketing
Officer.
6.2. Problem Statement
Global concerns about fossil fuel stocks and the climate have stimulated governments and
industry to explore the development of alternative sources of energy. According to US
Energy Administration, onlyabout 8% of the renewable energy is used for producing
energy used in the United States comes from renewable sources [34]. This needs tomust
be increased in the future, but this cannot happen without substantial investment,
research, and development. The problem addressed in our reports is the difficulty in
identifying the best technologies to support. This is an essential stepmust be done before
investors are willing to invest the necessary capital for developing such technology. For
example, the research done by the Power Economics division of GE Energy guided a
total of $2 billion of investment in clean energy in 2010 [22]. It is also necessary for
68
government planning agencies in the effort of shaping clean energy legislation for the
future.
In addition to the problem of finding investment, green technology companies, such as
Bloom Energy, must plan for their economic future. The Bloom Energy Bloom Box is
still in development, and its final cost to customers is still uncertain. Our research
Comment [LPW4]: So how will your report help
Bloom Energy make its decision?
addresses the challenge of identifying which design decisions are the most important
early in the development process. These are challenges that will not only be faced by
Bloom Energy, but also by other companies considering entry into the market.
Comment [LPW5]: State how much you can
save a company by hiring your services.
6.3. Solution and Value Proposition
Our solution to the problem facing investors and government planners is to conduct
the market analysis that will identify the clean energy sources that are most likely to
succeed in the future. By doing this, we can not only save customers the months of
work of time and money associated with doing the research themselves, but we can
also help prevent large economic loss by helping them avoid bad investments. This
research article will help others conducting similar kind of studies by reducing their
investment in terms of time and money spend.We estimate the cost of analysis alone
to be around $27,000 to produce one report, without including the cost of running our
company. By purchasing one of our reports for under $2,000, our customers are
saving around $25,000 over doing the research themselves. The cost of the analysis is
69
estimated using our schedule that requires 135 eight-hour days to produce one report.
Estimating labor at $25/hr yields a total cost of $27,000.
We also offer our reports at a lower cost than our competitors. Comparing to ABS
Energy Research, for example, the price for 16 energy analysis reports listed for sale
on their website ranges from $700 to $8,500, with an average price of over $2,800
[11]. Our cost of $1,800 represents a savings to the customer of 35%.
Green energy technology companies will benefit from our research reports as well,
because our results include a sensitivity analysis showing which cost elements can
most effectively drive down overall product costs. Bloom Energy, currently still
designing the residential version of the Bloom Box fuel cell, is still developing its
technology. Our report serves as an independent investigation for what cost reducing
reduction strategies will provide the highest probability for developing a cost
competitive product.
6.4. Market Size
The total clean energy venture capital investment in 2010 was $7.85.1 billion n, up 45.7%
from 2009 [1611]. Additionally, there are 10,209 green technology companies in
California. In each case, investors can benefit from the analysis reports that we will
70
Comment [LPW6]: How?
generate. It is reported by IbisWorld that the annual market size of energy consulting
services is $2.85 billion [23].
Over the last 10 years, the Cleantech Group, a clean technology consulting firm, has
provided consultation to 9,000 investors and 6,000 companies [8].
In addition to private companies, government agenciess are potential customers as well.
There are 22 states that already have some form of green energy regulations that are
based on energy research like the analysis that we will be doing. The federal budget
includes $5.4 billion in clean energy research annually [36].
Comment [LPW7]: You alos need to discuss the
market size for energy consultants NOT just the
market size for green energy. You need to do a bit
more research on the market size.
6.5. Competitors
Our competitors are firms that are already producing research papers in the green
technology area. These include both private companies and universities engaged in clean
energy market research. One of the most prominent competitors, mentioned above, is
ABS Energy Research who also sells analysis reports online. Two other competitors that
sell research reports online are GTM Research and a company called Markets and
Markets. Some clean energy companies like Clean Edge Technology and Clean Energy
Report offer a different kind of service, by selling subscriptions to access their analysis
results on their website, rather than buying reports one at a time.
6.6. Customers
We provide our research analysis report services on green technology to many companies
who are both developing technology and investing in the research. We plan to be able to
71
Comment [LPW8]: You must name your
competitors, the nature of what they do and in what
way they are comprtitors.
sell to any level of management from top corporate managers down to individual
analysts. The customers that are developing technology include existing companies
Comment [LPW9]: Name your potential
customers and why they would want to hire you.
interested in implementing green technologies, small manufacturing companies (potential
suppliers), and start-up energy technology companies. Bloom Energy is one example of a
start-up company that could use our analysis to help direct their product development.
Other examples include BrightSource Energy, a solar company, and GreatPoint Energy, a
company working with natural gas.
Companies that support the research include investors who want to enter into the market
of green technology, analysts who are interested to explore information about renewable
and clean energy, and consulting companies who are marketing for green technology.
Companies in this category include those like Accel and Kleiner Perkins, who invested
$50 million in Opower, a clean energy company [16]. Even individual investors like
George Soros, who invested $1 billion in clean technology, will be interested in our
research [37].
Furthermore, we plan to sell to government agencies aiming either to plan clean energy
legislation or to invest in technology development. The California state government is a
good example, because they offer large subsidies for solar power, but could stand to
benefit by switching to a more effective technology, if one is identified. We plan to be
able to sell to any level of management from top corporate managers down to individual
Comment [LPW10]: Name your potential
customers and why they would want to hire you.
analysts.
72
6.7. Cost
Formatted: Line spacing: Double, Keep with
next
As founders of our research paper reports company, we must consider several types
Formatted: Line spacing: Double
of costs involved in starting a business, one-time fixed costs, recurring fixed costs,
and variable costs. Variable costs are recurring expenses that depend directly on the
number of products sold, but we are planning to sell our reports online, in order to
eliminate the cost of printing, in addition to supporting our goal of promoting a green
environment. Since we are planning to sell reports in digital format, we expect only
negligible variable costs, so they are not included in our financial analysis.
6.7.1. Fixed Startup Cost
Part of our fixed costs includes the one-time, non-recurring startup cost. Typically
this includes the expenses incurred for purchasing office furniture, computers and
initial legal fees. For designing and maintaining our company website, we will be
hiring one expert on a contractual basis. This will be a one time job and we do not
anticipate any ongoing expenses related to the company website.
Table 15: Fixed Startup Costs
№
1
2
3
4
5
Items
Computers and Electronics
Furniture
Startup Legal Fees
Software
Website
Total
73
Cost ($)
10,000
5,000
2,000
2,000
5,000
24,000
6.7.2. Fixed Recurring Cost
Formatted: Line spacing: Double, Keep with
next
Fixed recurring costs are expenses that will need to be made on a periodic basis,
Formatted: Line spacing: Double
but do not depend on the number of products sold. These are expenses that are
incurred for marketing & advertising costs, utility bills for Internet and electricity
usage, employee salaries and expenditures on the various surveys that need to be
done from time to time. These costs may increase over time as we grow, but are
not dependant directly on the number of reports sold. The detailed breakdown of
the fixed recurring costs for the company is shown below in Table 16.
Table 16: Fixed Recurring Costs
№
Items
1
2
3
4
5
6
7
8
9
10
11
12
13
Salary
Benefits (40% of Salary)
Rent
Travel
Legal
Advertising
Office Supplies
Insurance
Utilities
Internet
Maintenance
Telephone
Other
Total
Monthly
Cost ($)
40,000
16,000
2,000
1,000
1,000
500
500
500
200
200
200
100
50
Quarterly
Cost ($)
120,000
48,000
6,000
3,000
3,000
1,500
1,500
1,500
600
600
600
300
150
186,750
As shown by this analysis, the cost of each report is project to be about $400,000 over
a six month period.
74
Formatted: Line spacing: Double
6.8. Price Point
We have chosen a price of $1800 for a customer to buy one copy of each research
report. This number has been obtainedwas reached by analyzing data ofobserving the
price of similar articles reports published in the past and the time we spent with our
employees on this particular projectchoosing a price that offers customers a lower
cost, while still yielding profits for our company in a reasonable amount of time. We
found that we could start with this price and still hit a break-even point at the 1.5 year
mark and stay profitable from that point forward.
Comment [LPW11]: Provide references to
publications that support your claim of a price point
of $1,800. An investor will not simplytake your
word.
In general, this our price of $1,800 represents at leastts approximately a 10%
reduction in price, per report, but in many cases, up to a 50% lower price. In these
cases, we have a significant giving us a price advantage. ABS Research, for example,
sells energy reports at an average price of $2,800 [11]. Another company, GTM
Research, sells solar research analysis for $1,995 per report to Solar Energy Industry
Association (SEIA) members and $3,995 for non-members [24]. The SEIA annual
membership dues range from $250 per year for the smallest companies to $55,000 per
year for the largest [30]. We found that we could start with this price and still hit a
break-even point at the 1.5 year mark and stay profitable from that point
forward.Markets and Markets sells their reports for $4,650 each [12]. Our price gives
us a clear advantage over these competitors, by offering customers analysis at a much
lower cost.
75
Comment [LPW12]: Provide references to
publications that support your claim of a price point
of $1,800. An investor will not simplytake your
word.
6.9. SWOT Assessment
Evaluating the Strengths, Weaknesses, Opportunities and Threats involved in any
project is an essential planning tool. Below is the SWOT analysis for the this
particular Green Technology Analysts Company<your company name> .
Table 17: SWOAT Assessment






Strength
Helps to minimize time & cost
for conducting similar research
Highly effective material at low
price
Potential for a very large
customer base
Opportunities
Growing popularity of Bloom
energy fuel cell market
Research on understanding
views of the application
developers
Huge market for low cost and
sustainable energy products




76
Weaknesses
Little information is available
on potential new competitors
Few contacts inside the
product companies on which
we are conducting our research
work
Threats
Competition is rising with more
companies coming up in this
area of research report
publication
Maintaining our selling price
and the margins when new
companies enter the market
6.10.
Investment Capital Requirements
Formatted: Line spacing: Double
As this is a research project, we will need to have large sum of money to keep the
company up and running during the initial phases. We have estimated an initial
investment of $250,000 $275K (see executive summary) to reach our break-even
point. This initial cost incurred for this project has been divided equally amongst
three team members Alina Adams, Amrita Chowdhary and Vashudha Subbaiah. This
money will be used to cover our initial expenses (i.e survey cost, advertising cost,
technical resource wedges cost, utility bills for internet and electricity usages) before
we reach the break-even point. We will reach our break-even point when total
cumulative revenue would covers our cumulative costsinvestment. We estimate this
point will be reached when we have sold approx. 600 research reports. This is
expected towould be around the 4th quarter of CY 2012. The number of copies sold
for each version of the report will initially increase and then eventually decrease as
new reportser versions are released. At the break-even point, we will have paid off all
our initial costs and will be able to sustain the recurring expenses and our profitability
at the same time. A year after our break-even point, wWe are expecting annual
revenues of about $1.71 million with an annual profit of $1 million.
77
Comment [LPW13]: I don’t believe you will
make $1M in profice on $1.1M in revenues. Think
about the definition of profit and revenues and redo
your calculations.
Comment [LPW14]: Please redo. I don’t believe
your profit number which means this graph will
change.
Figure 9: Break-even analysis
6.11.
Formatted: Line spacing: Double
Personnel
Management
The three members of our project team will all participate in the management of our
research company. Each team member will have well-defined roles in managing the
company - Chief Executive Operations Officer (Alina Adams), Chief Technology
Officer (Amrita Chowdhary), and Chief Marketing Officer (Vasudha Subbaiah). All
three of us have the necessary skills for managing this company:

Masters degree holder with GPA of 3.0 or above

Excellent knowledge in engineering management

Excellent technical skills
78
Comment [LPW15]: A CEO needs business
experience not so much technical experience. Are
you really the best person for the CEO position?
Rethink this.

Excellent verbal and written communication skills

Thorough understanding of computers and theirits operating systems

Excellent Mathematical skills
Comment [LPW16]:
We will hire a Chief Executive Officer with more business experience from outside
the company. Apart from the management team, we will also need seven experienced
employees is with different areas of expertise. Here is the breakdown of these
positions:

Software Engineer – 1 (part time)

Technical Engineer – 2

IT Engineers – 12 (part time)

Administrative staff – 1

Accountant – 1 (part time)
The detailed requirements and job skills for each of the above positions is given
below.
Software Engineer – Will be responsible for designing, developing and maintaining
our website. All our reports will be sold online and hence this is a very critical aspect
of our company.

Master degree holder in Computer engineering with GPA of 3.0 or above

Experienced in HTML, .NET, SQL, PL/SQL
79

Excellent technical skills

Excellent verbal and written communication skills

Thorough understanding of computers and its operating systems

Excellent Mathematical skills
Technical Engineer – Will be responsible for conducting surveys of the various
customers and production facilities related to our field of work. They will also be
responsible for analyzing and documenting the information and data gathered as part
of this exercise.

Master degree holder in Chemical engineer with GPA of 3.0 or above

Excellent technical skills

Excellent verbal and written communication skills

Thorough understanding of computers and good in MS-Office

Excellent marketing skills
IT Engineer – Will be responsible for collecting and storing all the data that has been
gathered as part of the various surveys. They will also be responsible for maintaining
our network, database servers and the web servers.

Master degree holder in Chemical engineer with GPA of 3.0 or above

Excellent verbal and written communication skills

Thorough understanding of computers and good in MS Office
80

Experience in maintaining and designing large scale networks consisting of
web and database servers.
Administrative Staff – Will be responsible for managing all the issues related to our
work place. This includes maintaining our office supplies, calendars etc.

Excellent verbal and written communication skills

Thorough understanding of computers and good in MS Office and MS Project
Accountant – Will be responsible for all our finances related to our business
activities, tax filing etc.

Must be CPA certified

Excellent verbal and written communication skills

Thorough understanding of computers and good in ms-office

Excellent mathematical skills
6.12.
Business & Revenue Model
In order to sell our research paper, we will first need to market and publicize it using
the online discussion forums, technical groups, blogs and the social network websites.
We also plan to present our work in a few of the technical conferences around the
country. This will increase the awareness regarding our product in the research and
developer community. Online websites selling goods using the b2b (business-to-
81
business) or the (b2c) business-to-consumer models are doing well and we plan to use
the same model for selling our research work as well. Additional revenue can be
earned by placing advertisements on our website related to the research paper we are
selling. These advertisements can be about some of companies selling the product for
which we are doing research or another products catering to the same market
segment.
Based on our business model, potential customer information, competitive
Comment [LPW17]: This is NOT a discussion
of your Business model. It is a discussion of a
marketing strategy. A business model describes the
nature of your business and where and how you plan
to position the business in a competitive market.
information and the value proposition of our product, we have decided to sell our
research paper at a price of $1800 per copy.We will start operations by selling the
initial research report generated during this project. A new report will be generated
every six months and the expectation is that the number of reports sold of each
version will initially increasese for every new revision and then decrease afterin a
couple of quarters. We will keep all previous reports available online, but we expect
their sales numbers to drop off as the data gets older. We plan to grow the size of the
research staff after the three-year point, and the size of the increase will depend on
how well we meet our profit goals.
While there are competitors in the market, our main competition strategy is our price.
We plan to sell reports of similar content and quality at a 35-50% price reduction
when compared to our competition. This is a strategy to gain customers and market
share initially, while building our company reputation. After our initial success, we
82
Comment [LPW18]: How will you sell your
reports? Will you sell online after a credic card # is
input? Will you accept surface mail orders? What if
someone wants to know if they can ourchase a
portion of the report. Will you have a customer
report support group to answer questions?
will have the opportunity to sell reports at a higher price if the decision is made to do
so in the future.
In order to reduce printing costs and run a green company, we will sell our reports
online only, at first. If we get more requests for hard copies than we expect, we will
revisit this decision. We have included the cost of designing the website and will staff
software and IT engineers. These will be part-time positions at first, but may need to
be changed in the future. Our current plan is to sell the reports as whole units, and
questions about the process will be handled by the administrative employee. Orders
placed by mail will be accepted, and will be entered into the computer system by the
administrative employee.
6.13.
Strategic Alliances/Partners
We are working as a team in developing and marketing our research paper. We do not
intend to enter into any sort of partnership with other companies at this time.We have
several options for strategic Alliances and Partnerships. While we are currently not
planning to form a partnership, we have considered the option and plan to keep it
open in case our business model needs to be restructured. One of the strategic
alliances that we have considered is making our analysis available to students at a
reduced cost by partnering with university libraries. We would offer a subscription
service to university libraries on an annual basis. Students at the university would
then have access to our research. This will give them an opportunity to become
83
Comment [LPW19]: This section is not intended
to discuss whether you do or do not plan to form
partnerships.. This section should discuss who you
MIGHT form strategic alliances with if and when the
opportunity presents itself –OR- your business
model fails and you need to find an alternative way
to survive. Please update this section.
acquainted with our company and provide a form of a trial version that will end at the
end of their time in school. Then, when they enter the work force, they will already be
familiar with the quality of our work and will be willing to buy new reports at cost.
Another partnership option that we have considered is allowing some of the larger
research companies to sell our reports on their websites. They would get a percentage
of the sale, but we would keep the pricing such that we still make a profit, although
smaller, on the sale of each report.
6.14.
Profit and Loss Statement
Estimated expenses and sales are evaluated in profit & loss statement for Q1-2011 to
Q4-2013. (3 Year)
Table 18: Profit and loss statement
Year
Quarter
2011
2011
2011
2011
2012
2012
2012
2012
2013
2013
2013
2013
1
2
3
4
1
2
3
4
1
2
3
4
Cumulative
Number of
Copies /
Quarter
0
0
50
105
216
337
507
683
902
1121
1379
1634
Cumulative
Cost ($)
0
0
214,400
401,150
587,900
774,650
961,400
1,148,150
1,334,900
1,521,650
1,708,400
1,895,150
84
Cumulative
Profit/Loss
Revenue
($)
($)
0
0
90,000
189,000
387,900
606,690
913,401
1,229,221
1,623,259
2,017,673
2,482,446
2,940,521
0
0
-124,400
-212,150
-200,000
-167,960
-47,999
81,071
288,359
496,023
774,046
1,045,371
Figure 10: Profit and loss data for three years
As shown in the above graph, we expect to profitable from the 4th quarter of CY
2012. We estimate our profits to be around $1.1 million by the end of 2013.
85
Formatted: Line spacing: Double
6.15.
Formatted: Line spacing: Double, Keep with
next
Exit Strategy
We expect to break even after the second year and have approximately $1 million in
profit for the third year. We will try to grow the profit, but have just started on our
venture for publishing research report for various products and solutions. At this time
we are expecting our company to make a profit of about $1 million by 2013. We
currently have no plans for selling this company or our intellectual property in the
next 10 years. At that time we will estimate the value of the company and look for
potential buyers along with the right offer price. Ultimately we would be comfortable
selling our company along with the related copyrights for around $20 million 10
years from now. Until then our goal is to provide excellent service and material to all
our current and future customersa conservative estimate for the next 7 years would be
to simply hold the profit constant at $1 million. If we can at least do that, the 10 year
profit will be $8 million. If we split this profit 50% to the investors and 50% among
the 4 management officers., that represents a $4 million gain for the investors. This is
a 1400 % return on the initial $275,000 investment in a 10 year period. That
corresponds to better than a 30% annual return over the 10 year period. Considering
that this is the conservative estimate for profit growth, we feel that this is a very
attractive investment opportunity for investors. That also leaves a conservative
estimate of $1 million for
each of the management officers as well at the end of the ten year period. At this
point, we would consider selling the company for the value of another ten years of
86
Comment [LPW20]: An investor will want to
know all of the different ways they can get their
investment badk + significant profit. You MUST
also provide a time frame over which an investor can
expect to get their ROI. Do some research on how
your competitors exit and provide justification about
the most likely way your company will exit.
You also must provide an anticipated ROI
calculation.
Formatted: Normal (Web), Indent: Before:
0.25", Line spacing: Double
profits, or $10 million. However, if the profit growth is better than the conservative
estimate, we will most likely not be interested in exiting, but rather running the
company for a longer term.
87
Formatted: Line spacing: Double
7. Project Schedule
7.1. Gantt Chart
88
89
Formatted: Line spacing: Double
8. Team and Committee Structure
There are three team members: Alina Adams, Vasudha Subbaiah, and Amrita
Chowdhary. Alina and Vasudha are both in Engineering Management and focused on
the financial analysis. Amrita is in Electronic Materials and Devices and focused on
identifying what solar cell and fuel cell technology changes will have cost
implications in the future.
Our faculty advisor is Mithal Albassam from the ISE department at San Jose State
University. She has taught classes such as Financial Methods for Engineers and has a
beneficial background to advise on the financial analysis techniques we are using.
Her experience in academia has proven invaluable for the planning and organization
of our project and report.
Our technical advisor is Karl Stahl from Tesla Motors. He has a MS in Mechanical
Engineering from Stanford University and has worked on various engineering
research projects at Stanford. He has provided helpful advice on the sections related
to electricity generation technology.
9. Future Work
This project report denotes the completion of our first analysis report. Future work in
establishing our company involves setting up the office environment and officially
90
creating a legally recognized company. Further in the future is effort of generating
additional reports. Our plan, as described above, is to schedule one report every six
months.
10. Conclusion
We have performed a comparative cost analysis in an effort to forecast the future costs of
three different alternatives for providing electricity to residential consumers. The
comparison is between purchasing electricity from utility companies, using solar panels,
and generating electricity with the Bloom Energy Bloom Box. In our analysis we have
identified that Bloom Energy has the potential to develop a competitive product. In our
cost estimates, we found that in some cases, the Bloom Box is the cheapest electricity
source among the three alternatives. However, we have found that the Bloom fuel cell
will likely need the right conditions or some form of cost reduction to be able to beat
traditional electric companies. The annual cost of using a Bloom Box relies heavily on
the price of natural gas, something that Bloom Energy has no control over. If the price of
electricity increases more than the price of natural gas, Bloom has the best chances for
success. However, we have also identified several target areas that Bloom can focus on,
in order to decrease dependence on the natural gas market. If Bloom can eliminate or
significantly reduce maintenance costs, then only a moderate purchase price reduction
will put Bloom in a good strategic position. Finally, if the Bloom Box is a clean energy
alternative that government would be interested in supporting, we recommend
considering the option of natural gas subsidies for fuel cell users.
91
Formatted: Font: Not Bold
11. References
Formatted: Bullets and Numbering
11.
Formatted: Line spacing: single
Adamson, K. (2007). Stationary fuel cells : an overview. Amsterdam: Elsevier.
Bakis, R. (2008). Alternative Electricity Generation Opportunities. Energy Sources Part
A: Recovery, Utilization & Environmental Effects, 30(2), 141-148.
doi:10.1080/00908310600628362.
Formatted: Space Before: Auto, After: 0 pt
Black, A. J. (2004). Financial payback on California residential solar electric systems.
Solar Energy, 77, 381-388.
1. Adamson, K. (2007). Stationary fuel cells: An overview. Amsterdam: Elsevier.
Formatted: Font: Italic
2. Bakis, R. (2008). Alternative electricity generation opportunities. Energy Sources Part
A: Recovery, utilization & environmental effects, 30(2), 141-148.
Formatted: Font: Italic
doi:10.1080/00908310600628362
3. Black, A. J. (2004). Financial payback on California residential solar electric systems.
Solar energy, 77, 381-388.
4. Bloom Energy. (2010). Understanding California's electricity prices. Sunnyvale, CA:
Bloom Energy. Retrieved August 25, 2010, from
http://www.bloomenergy.com/products/resources/
5. Bloom Energy. (2010). Retrieved from http://www.bloomenergy.com/
Formatted: Indent: Before: 0", Hanging: 0.5"
4.6. Bowman, M. S. (2003). Applied economic analysis for technologists, engineers, and
Formatted: Bullets and Numbering
mangers second edition. Upper Saddle River, NJ: Pearson/Prentice Hall.
7. Charters, W. W. S. (1991). Solar energy: Current status and future prospects. Energy
Policy, 19(8), 738-741.
8. Cleantech Group. (2011). Retrieved from http://cleantech.com/
5.9. Bloom Energy (2010). Understanding California's Electricity Prices. Sunnyvale,
CA: Bloom Energy. Retrieved August 25, 2010, from
http://www.bloomenergy.com/products/resources/
6.Bloom Energy (2010), Retrieved from website: http://www.bloomenergy.com/
92
Formatted: Indent: Before: 0", Hanging: 0.5"
Formatted: Bullets and Numbering
7.Costs of sSolar photovoltaics. Retrieved Oct 22, 2010, from m Website:
http://www1.eere.energy.gov/tribalenergy/guide/costs_solar_photovoltaics.html
8.10. De Guire, E. J. (2003). Solid oOxide fFuel cCells (Released April 2003). Retrieved
from m website: http://www.csa.com/discoveryguides/fuecel/overview.php
11. Electricity market research. (2011). ABS Energy Research. Retrieved from
http://www.absenergyresearch.com/energy-market-research-reports/electricitymarket-research-reports/fullreport-databaselisting
12. Energy and power market research reports & consulting. (2011). Retrieved from
http://www.marketsandmarkets.com/energy-power-supplies-market-research4.html
10.13. European Photovoltaic Industry Association. (2010, November 28)). Application
Formatted: Bullets and Numbering
and classification of different types of solar panels. Retrieved from
http://www.epia.org/publications/epia-publications.html
Formatted: Indent: Before: 0", Hanging: 0.5"
11.14. Giresunlu, U., Gunerhan., H., & Hepbasli, A. (Mechanical Engineering
Formatted: Bullets and Numbering
Department, Faculty of Engineering, Ege University, Bornova, Izmir,
Turkey2009).; Environmental impacts from the solar energy systems. Hepbasli,
A.; Giresunlu, U. Source: Energy Sources, Part A: Recovery, uUtilization and
eEnvironmental eEffects, v 31(, n 2)2, p 1131-138, January 2009.
Formatted: Indent: Before: 0", Hanging:
0.5", Space Before: 0 pt, After: 0 pt
11.15. Haftl, L. (2007, April 20, April 20). Measuring new equipment return on
investment (ROI). American Machinist. Retrieved from
http://www.americanmachinist.com/304/Issue/Article/False/52770/Issue
16. Kuo, I. (2011). Record $7.8 billion year for cleantech venture capital in 2010, but two
quarters of decline. GreenBeat interpreting innovation. Retrieved from
http://venturebeat.com/2011/01/07/record-7-8-billion-year-for-cleantech-venturecapital-in-2010-with-declines-in-second-half/
17. Makower, J., Pernick, R., & Wilder, C. (2007). Clean Energy Trends. San Francisco,
CA.
93
Formatted: Indent: Before: 0", Hanging: 0.5"
Formatted: Bullets and Numbering
Formatted: Font: Not Italic
Formatted: Font: Italic
13.18. Ostwald, P. F., & McLaren, T. S. (2004). Cost analysis and estimating for
Formatted: Bullets and Numbering
engineering and management. Upper Saddle River, NJ: Pearson/Prentice Hall.
14.19. Pearce, D. W, Atkinson, G., & Mourato, S. (2006). Cost-benefit analysis and the
environment: recent developments. Paris: Organisation for Economic Cooperation and Development.
15.20. Photovoltaics., (n.d.). Retrieved Oct 22, 2010, from Wikipedia Web site:
http://en.wikipedia.org/wiki/Photovoltaics
16.21. Pogutz, S., Russo, A., & Migliavacca, P. N. (2009). Innovation, markets and
sustainable energy: the challenge of hydrogen and fuel cells. Cheltenham, UK:
Edward Elgar.
22. Power economics. (2011). GE Energy. Retrieved from
http://www.gepower.com/prod_serv/serv/energy_consulting/en/power_economics
.htm
23. Scientific, technical & economic consulting. (2010). Ibisworld Industry Reports.
Retrieved from http://www.ibisworld.com/industry/default.aspx?indid=1428
24. SEIA/GTM research US solar market instight. (2011). Retrieved from
http://www.gtmresearch.com/solarinsight
25. Sen, Z. (2004). Solar energy in progress and future research trends. Progress in
Formatted: Indent: Before: 0", Hanging: 0.5"
energy and combustion science, 30(4), 367-416.
17.26. Siemens Energy. (2010)., Retrieved from the website:
Formatted: Bullets and Numbering
http://www.energy.siemens.com/fi/en/power-generation/fuel-cells/principlebehind-technology.htm
18.27. Smil, V. (2010). Energy myths and realities : bringing science to the energy policy
debate. Washington, D.C.: AEI Press .
19.28. Smithsonian National museum of American History. (2010)., Retrieved on March
15, 2010, from website: http://americanhistory.si.edu/fuelcells/
94
Formatted: Bullets and Numbering
20.29. SSEN Zekai. Solar energy in progress and future research trends: Progress in
Formatted: Font: Italic
energy and combustion science Y. 2004, vol. 30, No. 4, pages 367-416 [50 pages]
[bibl. : 150 ref.]: Elsevier Science
21.Solar Energy Costs., (2010n.d.). Retrieved Oct 22, 2010, from Solarbuzz Web sitem:
http://www. solarbuzz.com/StatsCosts.htm
30. Solar Energy Industries Association membership. (2011). Retrieved from
http://www.seia.org/cs/membership
22.31. Technology Roadmap. (2010). , Solar photovoltaic energy. Retrieved from
http://www.iea.org/papers/2010/pv_roadmap.pdf
Formatted: Font: Italic
Formatted: Indent: Before: 0", Hanging: 0.5"
Formatted: Bullets and Numbering
23.32. Types of Fuel Cells. (2009)., Retrieved on September 30th, 2009, from website:
http://willyyanto.wordpress.com/2009/09/30/types-of-fuel-cell-pros-and-cons/
24.33. United States Energy Information Administration. (2010). Annual Energy Outlook
2010 With Projections to 2035 (DOE/EIA-0383(2010)). Washington, DC: U.S.
Department of Energy. Retrieved from
http://www.eia.doe.gov/oiaf/aeo/index.html
25.34. United States Energy Information Administration. (2010). Energy prices by sector
and source. [Data file]. Retrieved from
http://www.eia.doe.gov/forecasts/aeo/early_prices.cfm
26.35. United States Energy Information Administration. (2010). Residential average
monthly bill by census division, and state. [Data file]. Retrieved from
http://www.eia.doe.gov/cneaf/electricity/esr/table5.html
27.36. United States Office of Management and Budget. (2011). Department of Energy.
Washington, DC: U.S. Department of Energy. Retrieved from
http://www.whitehouse.gov/omb/budget/Overview
1.
37. Whitney, L. (2009). Financier Soros to invest $1 billion in clean tech. Green
Tech. Retrieved from http://news.cnet.com/8301-11128_3-1037394654.htmlWilliam W. S. Charters. (1991). Solar energy: Current status and future
prospects, Energy Policy, Volume 19, Issue 8, October 1991, Pages 738-741,
ISSN 0301-4215, DOI: 10.1016/0301-4215(91)90043-N.
95
Formatted: Indent: Before: 0", Hanging:
0.5", No bullets or numbering, Tab stops: Not
at 0.64" + 1.27" + 1.91" + 2.54" + 3.18" +
3.82" + 4.45" + 5.09" + 5.73" + 6.36" + 7"
+ 7.63" + 8.27" + 8.91" + 9.54" + 10.18"
Formatted: Font: Not Italic
Formatted: Font: Italic
29.(1991). Guidelines for the economic analysis of renewable energy technology
applications : based on the findings of the International Energy Agency Workshop
on the Economics of Renewable Energy Technologies, Chateau Montebello,
Quebec, Canada. Paris: The Agency.
96
Formatted: Bullets and Numbering