Announcements & Other Business

Subject: UFTO Announcements & Other Business
Date: Sun, 22 Sep 1996 13:03:48 -0700
From: Ed Beardsworth

| *** UFTO *** Edward Beardsworth * Consultant |
| 951 Lincoln Ave. tel 415-328-5670 |
| Palo Alto CA 94301-3041 fax 415-328-5675 |
(Since we don’t do the “Bulletin” anymore, here’s a new way to feed you bits and pieces of information.)

1. T&D Workshop Plans are firming up for the UFTO T&D Workshop at PNL. Date will be either Nov 4-5 or Nov 11-12, from noon to noon. We’ll have a decision about the dates by the end of this week. There will also be a number of other things for you to see or do after we adjourn, by arrangement with PNL. Details forthcoming.

A few of you haven’t responded yet about whether you or someone from your company plans to attend, so please let me know. Also, ideas and issues for the program/agenda would be very helpful. What would YOU consider to be a successful outcome?

2. Travelin’ I’ll be out of the office Mon – Wed, and back on Thurs. Sept 26. I will be checking tel. messages, but will NOT have access to email.

I will be visiting Ontario Hydro Technologies (OHT) in Toronto, to look at the technologies and services they have to offer UFTO (and maybe convince them to join UFTO — as a user as well as a supplier of technology). As you probably know, OHT is Ontario Hydro’s former in-house R&D division, now a separate subsidiary.

October 8,9, I’ll attend the (invitation only) DOE/Dawnbreaker “Commercialization Opportunity Forum” in DC, to see presentations by 42 SBIR awardees–startup companies that are looking for investors and partners.

Technology 2006, the big annual NASA conference, is in Anaheim Oct 29-31. I plan to attend, particularly the exhibits. It’d be great to see you there, too. For registration info, call 1-800-844-NASA.

EOSytems, Inc. Electrochem. Oxid of Hazardous Organics

Subject: UFTO Note — EOSytems, Inc. Electrochem. Oxid of Hazardous Organics
Date: Fri, 20 Sep 1996 10:39:33 -0700
From: Ed Beardsworth

| *** UFTO *** Edward Beardsworth * Consultant |
| 951 Lincoln Ave. tel 415-328-5670 |
| Palo Alto CA 94301-3041 fax 415-328-5675 |

**** “EOSystems — Electrochemical Oxidation of Hazardous Organics — benign on-site modular treatment, eliminating transport and incineration while building off-peak electric load. Also applicable to low-level radwaste volume reduction.” (UFTO Tech Nugget, August 1995) ****

UPDATE! There’s been considerable progress —

EOSystems, Inc. is commercializing a process for the destruction of both organic and mixed (hazardous wastes containing some level of radioactivity) organic wastes. They have recently obtained the first 20% of a $5 million private offering, and welcome inquiries by additional potential investors and other interested parties.

This is “electrotechnology” at its best. Significant for utilities, the process consumes considerable amounts of electric power, and this load can be shifted to off-peak times, making this a win-win-win for the utility, for the industrial customer, and for the environment.

EOSystems’ vision is to eliminate the creation, transportation and incineration of hazardous wastes by placing a unit at the site of every generator, from university labs to major chemical manufacturers and government facilities.

The Company has designed a proprietary reactor cell, which is the heart of the system. The cell is designed to be manufactured in volume from high density plastics, using advanced injection techniques, resulting in a system that is inexpensive to manufacture, service and replace. The engineering is being done jointly by EOSystems and Fluoroware, Inc., of Chaska, Minnesota.

EOSystems’ process is mediated electrochemical oxidation (MEO), for the destruction of hazardous aqueous organic process streams. The technology was commercially refined at both Pacific Northwest Lab (PNL) in Washington state and at Lawrence Livermore National Lab with a $4 million CRADA. The testing and prototype development have been completed by EOSystems and Flouroware with help from PNL. Controlled Power of Troy, Michigan, is aiding in the design and manufacture of custom power supplies.

EOSystems’ market is estimated at $200 billion in capital equipment sales to private and public laboratories, as well as chemical, pharmaceutical and semi-conductor companies. Manufacturers will employ EOSystems’ electrochemical oxidation in their processes to reduce or eliminate the creation of wastes which are currently difficult and expensive to handle and destroy (e.g., by incineration or landfill).

All wastes are fully contained until destroyed, eliminating costly downstream trapping required by thermal destruction processes. The system is also scalable to a customer’s process volume, and will match the specific constituent demands of each process stream, saving manufacturers even more in process costs while eliminating the liability associated with production of hazardous wastes.

EOSystems’ MEO is a very rapid, chemical, non-biological, step-wise dismantling of the organics, one electron at a time. It converts organics to carbon dioxide and water, using electricity to force a chemical reaction which picks up an electron from the organic, changing its chemical make up. The “mediator” is a metal ion in the solution; in this case the ion is cerium3+, which is exposed to an anode that removes an electron, changing it to cerium4+, an element now hungry for an electron. The cerium4+ is injected into a vessel containing the organics, where it sucks an electron from an organic, becoming cerium3+ again, and unbinding the organic so that it converts into carbon dioxide and water.

UFTO can provide a more detailed company summary, or contact:
Tony Steward, President, EOSystems, San Jose, CA 408/744-9180

High Strength Conductors

Subject: UFTO NOTE — High Strength Conductors
Date: Fri, 20 Sep 1996 13:18:23 -0700
From: Ed Beardsworth

| *** UFTO *** Edward Beardsworth * Consultant |
| 951 Lincoln Ave. tel 415-328-5670 |
| Palo Alto CA 94301-3041 fax 415-328-5675 |

High Strength Conductors
A new class of alloys developed at Ames Laboratory has 10 times the tensile strength of copper, at about 80% the electrical conductivity. These are deformation processed copper metal matrix composites that have a long filamentary microscopic structure.

Possible applications, in addition to non-sagging transmission and distribution wires that could allow hotter operation and increased tower spacing, include use in equipment where tensile strength is extremely important, such as generators or pulsed-power magnetizers that are used to make permanent-magnets.

While the metallurgy aspects have been published in trade journals, there’s been no funding currently available to pursue these various power systems applications. The Lab would appreciate input from interested industrial parties.

In related work, the Lab also has developed improved aluminum metal-matrix composites with increased strength and very little loss of conductivity, which may be another candidate for power conductor applications.

Contact: Larry Jones, (Principal Investigator), Ames Laboratory, 515-294-5236

Cold Fusion Survey Offered

Subject: UFTO NOTE — Cold Fusion Survey Offered
Date: Fri, 20 Sep 1996 13:55:58 -0700
From: Ed Beardsworth

| *** UFTO *** Edward Beardsworth * Consultant
| 951 Lincoln Ave. tel 415-328-5670
| Palo Alto CA 94301-3041 fax 415-328-5675

ENECO Offers Survey of Cold Fusion

ENECO has completed a comprehensive review of the entire field of cold fusion, with emphasis on the current status of technical and commercial developments worldwide.

Sections of the report include:
– Summary of the history of cold fusion, with key dates and chronology
– Overview of the field
– Technological Approaches, covering more than a dozen major categories of devices,
phenomenology and theory.
– Review of Key Players and Institutions
– Overview of Intellectual Property
– Recommendations and Proposal for Pooled Research Program

The intent of the survey is to raise the information level of utilities and other interested corportations to the point where they can intelligently decide whether to participate in ENECO’s ’97 Pooled Research Program. This program takes a very practical approach to use pooled funds to provide each participating organization with early, direct, hands-on experience with leading candidates for commercial applications. It will fund specific experiments and tests to confirm or deny key technical and scientific claims, thus positioning participants to establish their own business approaches and strategies with the benefit of superior information.

Price: $10,500 (Reduced to $9,500 for UFTO members, by special arrangement.)

Price includes three bound copies of the complete confidential report for the same organization.

Also included is an update/supplement to report on developments at the very important Cold Fusion conference, October ’96 in Japan.

A more detailed description of the Survey and ENECO are available on request.
Contact ENECO at 801-583-2000, and ask for the Cold Fusion Survey Information Package. (Identify yourself as an UFTO member.)

Prospects for Ballard and ERC Fuel Cells

Subject: UFTO Note: Prospects for Ballard and ERC Fuel Cells
Date: Mon, 02 Sep 1996

UFTO NOTE: Stock Price Prospects for Ballard and ERC, Fuel Cell Developers

KIIS STRATEGY FOR START UPS: KEEP IT INSOLVENT, STUPID! By Robert Metz (Originally published Aug 26 in `Money Talks,` an interactive investment magazine at

Summary: Two developmental fuel cell firms that could hit home runs or go broke depending on the success of their technologies. For high share price: lose money, sell more stock: your investment banker will tout your stock.

There is an old joke about a company that loses money on every sale but makes it up in volume. Here’s a variation on that joke involving fuel cells:

Fuel cells are like batteries with this difference: when a battery runs down, you recharge it by pumping in more electricity. A fuel cell combines hydrogen and oxygen to make electricity. The exhaust: pure water, son! But fuel cells, which make electricity without combustion, are larger, less powerful and vastly more costly than internal combustion engines.

The joke: Ballard Power loses millions building fuel cells for vehicles. As a result, Ballard must raise cash through repeated equity offerings. Contrast Ballard with Energy Research Corp. which develops its non- polluting fuel cells for electric utilities. Its utility clients seek a clean means of producing electricity that will replace their dirty, coal-burning plants.

Like Ballard, Energy Research is developmental. Yet an ER cell does supply power to homes in Santa Clara. And ER earns a little money, too.

The punch line: Burnaby, Canada-based Ballard (BLDPF, Nasdq) is the preferred investment. Don’t laugh! Ballard Power has achieved a market capitalization seven times that of Energy Research (ERCC, Nasdq).

Why? Canadian bankers are almost constantly touting Ballard. They earn fees for selling each Ballard equity offering to the investing public. All this `sponsorship` as it’s called on Wall Street, creates a high share price.

They say that mutual funds are not bought, they are sold, no-load mutual funds to the contrary notwithstanding. This is true of shares in developmental firms, too. Brokers dazzle, talking of millions of family cars traveling the highways of the world powered by non-polluting fuel cells.

Get this! Energy Research needs no outside capital. So it isn’t touted. Keep in mind that my source on these two companies is admittedly long ERCC and short BLFPF. He asked me not to disclose his name. Ballard, with whom he talks, obviously would not take his calls if he were named.

Let’s look directly at the numbers. Energy Research has 4 million shares outstanding. When at 13, the shares were worth $52 million. Ballard has 15.2 million common shares out and 1.5 million warrants to buy shares at a low price. With the stock at 21, BLFPF’s market cap is roughly $340 million. Those are the key numbers for innovative developmental firms. Such companies tend either to soar or go broke. It’s either/or, as a rule.

There are other reasons why traders prefer Ballard, not the least of which is glamour. Imagine a vehicle that uses hydrogen as fuel and which dribbles onto the pavement nothing more toxic than water vapor. Is there such a vehicle? Yes, G.M. and Daimler Benz have both purchased fuel cells from Ballard. Honda and Volkswagon are also pursuing fuel cells. Ballard’s ebullient CEO, Firoz Rasul, insists the technology is ready. He says his company is banking on environmental regulations to spur demand for its fuel cells. But he admits that the the final call is the car makers’.

The public got a glimpse of Ballard’s technology in June. Daimler-Benz showed the press a working prototype powered by Ballard’s fuel cells. Except for bulky rooftop hydrogen tanks, the system fit under the hood and seats of a Vito `minivan` from Daimler’s Mercedes-Benz automobile unit.

The cell has few moving parts, no sparks or fumes. Methanol can be used to fuel the cells. Whoops! It must first be converted into hydrogen through a process that releases carbon dioxide. Is this for you? The last vehicle Germany sent us with hydrogen on board was the Hindenburg.

When is the fuel cell coming to a highway near you? Mercedes’ Chief Executive, Helmut Werner, is optimistic that fuel cell technology will find a permanent place in his company’s product line up. He crows that the work is going faster than he expected, but his on-the-road target is 12 years out. If you paid for a Mercedes Benz vehicle with Ballard Fuel Cell, it’d cost you, say, $500,000. That same sum would buy about five Rolls Royce cars.

Cost is the rub with Energy Research as well. ERCC’s fuel cells, like those of Ballard, are custom built. Both must be mass producd if the cost is to sink to a level that makes these fuel cells both practical and affordable.

It’s been a long journey just getting this far. The fuel cell was thought up in the 1830s. The fuel cell is a vastly more efficient than rival power means. Utilities produce electricity by burning coal, oil, and natural gas. The heat produced is used to super heat water, turning it to steam which turns the vanes in a turbine which spins a generator and produces electicity.

There is energy loss every step of the way. Utility power plants may extract only 25 percent of a given fuel’s energy potential. `Co-generate` the heat the process throws off and get a total of 30 percent of the energy.

Energy Research’s Santa Clara fuel cell can use kerosene, gasoline or methane, any hydrocarbon at all, to recover 50 percent of the fuel’s energy. Using the heat for co-generation may squeeze out 80 percent of potential.

Fuel cells offer far more efficiency than any other practical process. Yet fuel cells remain prohibitively expensive for most uses. Do note that NASA has used fuel cells to power manned space programs for decades.

As my source views it, Energy Research with its unglamorous partners, some 30 of the nation’s largest utilities, is more likely to win the brass ring. Keep in mind both companies are betting heavily on fuel cells. Either one or both could score. But shares of either one or both could go to zero.

Keep this in mind: there is no infrastructure to support an automobile that burns hydrogen. Gas stations don’t stock the alternative methane, either. Utilities, by contrast, have access to fuels suitable for fuel cells.

Wait! If ERCC misses the bullseye with fuel cells, it does have another arrow: batteries. So the stock may be worth more than current price. The fan says ER’s nickel zinc battery will zap nickel cadmium and nickel metal hydride batteries. Or so its `conservative` management avers. ER is supposedly negotiating with two companies to commercialize the nickel zinc battery. The first of two deals could be done in a month, the fan says.

ER could become multi billion dollar company either with its fuel cells or with its batteries. My source, who, you’ll must keep in mind, is long ERCC and short BLFPF, says ER is `a triple digit stock if it hits with both.`

But, he adds, `If we knew for sure either or both technologies would work ERCC would already be in triple digits. Maybe neither will work and the stock will go to zero.` But it seems to him ER’s goals are realistic since a 30 utility `Fuel Cell Commercialization Group` is working with ERCC.

| *** UFTO *** Edward Beardsworth * Consultant |
| 951 Lincoln Ave. tel 415-328-5670 |
| Palo Alto CA 94301-3041 fax 415-328-5675 |

Argonne Industry Day

Subject: Argonne Industry Day; and UFTO point of contact
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Dear Roger:
Thanks for your cordial response. I know you appreciate the reasons for our interest in maintaining close relationships with Argonne. In particular, we’re long overdue to update our UFTO report on Argonne.

By copy of this note, I’ll inform the UFTO members about your event on September 17. Unfortunately, I won’t be able to attend myself, but I would like to see the information about it.

In the meantime, who can I consider as a primary point of contact at ANL? Are your volunteering? Can I assume that the note about our planned UFTO T&D workshop has reached (or will reach) the right people?

Thanks again for your attention
Sincerely, Ed Beardsworth/ UFTO

RB Poeppel wrote:
> Reply to: RE>POC at ANL for Utility Fed Technology Oppty (UFTO)
> Dear Ed: Greetings. We met when you visited in May of 1994. We appreciate
> your continued interest in Argonne National Laboratory. Your e mail is very
> timely. We are holding a business and industry day on September 17. There
> may never be a better opportunity to get a full view of Argonne programs and
> capabilities in a single day. Let us know if you will be able to attend and I
> will have all the information sent to you.
> Roger Poeppel