Year 2000 could very well be the year of the fuel cell on WallStreet as next year is expected to see the first commercializationof the technology on Main Street. While most consumers have yet tohear of the systems that could one day be big, gas-poweredbatteries in their backyards, investors certainly are aware.

KeySpan Technologies Inc., a subsidiary of KeySpan Energy, justsigned an agreement with GE MicroGen, a subsidiary of GE PowerSystems, to buy and test 30 residential natural gas-powered fuelcells, manufactured by Plug Power, at selected locations in NewYork City and Long Island. The testing is seen as the first step infuture marketing and product-service ventures. KeySpan has theopportunity to become the utility with exclusive rights to marketand maintain fuel cell units in New York City and Long Island. GEMicroGen already has an exclusive agreement for New JerseyResources to market its fuel cell product in its home state. FlintEnergies is signed up to market the fuel cells in southern Georgia.

Avista Corp., based in Spokane, WA, got on board the technologystock express recently as Washington state neighbor, Bill Gatestook a 5% stake in the company and Avista’s stock price just aboutdoubled. Gates’ interest was spurred in part by Avista’sinvolvement in the fuel cell market, according to analysts.

Wall Street has taken a liking to fuel cells, principally in theform of stock in Plug Power, a three-year old venture co-founded byDetroit Edison parent DTE Energy and Mechanical Technology. PlugPower went public in November at about $20 share. The stock closedyesterday at $98.94. The stock has traded as high as $156.50.Sempra Energy’s SoCal Gas also has invested in Plug Power.

“This aggressive fuel cell testing program builds on KeySpan’stradition of leadership in developing and marketing innovativetechnology,” said Robert B. Catell, KeySpan Energy CEO. “We have acommitment to clean and reliable fuel cell technology that spansmore than two decades. With this agreement, we are taking a majorstep toward moving the benefits of fuel cell technology into thehome. “Customers looking for ‘green power’ will find fuel cellsparticularly attractive.”

KeySpan and Avista aren’t the only companies turning to fuelcells. GPU Inc., headquartered in Morristown, NJ, and the parent ofelectric utility GPU Energy, has an investment in BallardGeneration Systems (BGS) with Ballard Power Systems of Vancouver,BC. GPU and Ballard formed BGS in December 1996 and have beenworking to develop and commercialize a range of fuel cell productsor homes and businesses.

BGS products range from a 250-milowatt unit for commercialbuildings to a 1- to 10 kW unit for homes. They will be deliveredand tested in field trial programs during the next few years. A 250kW BGS fuel cell power plant is operating at the Crane Naval AirStation in Indiana, and others are to be installed soon in Europeand Japan. GPU said it expects to make its final $4 millionmilestone payment within the next few months to complete its $23.25million investment in BGS. GPU will own about 13% of BGS with theremainder owned by partners Ballard Power Systems, Alstom SA ofFrance and Ebara of Japan. Ebara and Alstom provide manufacturingcapabilities and access to the European and Japanese markets.

“We have always believed that the fuel cell will play animportant role in the future supply of power to residential andsmall commercial users,” said Fred D. Hafer, GPU CEO. “As fuel celltechnology progresses, GPU anticipates providing the differentkinds of utility service our customers will require in the future.We expect that BGS will ultimately be able to offer a full line offuel cell power supply products to residential and commercial usersof all sizes.”

KeySpan Energy is the parent company of Brooklyn Union, whichhas been actively involved in fuel cell development for more than30 years. In 1992 the company installed a 200 kW ONSI PC25 fuelcell at St. Vincent’s Medical Center that is providing the hospitalwith electricity and hot water. In 1996 the company engineered andsupervised the installation of two PC25s at Sun Chemical Corp. Bothinstallations are in the New York City borough of Staten Island.

GE MicroGen is a subsidiary of GE Power Systems, one of theworld’s leading suppliers of power generation technology, energyservices and energy management systems. In February GE MicroGen andPlug Power, a leading developer of proton exchange membrane (PEM)fuel cells, formed a joint venture to distribute, install andservice Plug Power-manufactured stationary fuel cell systemsworldwide. The venture with Plug Power is the latest in a series ofactions by GE Power Systems to broaden its participation in thesmall power generation market.

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