Ballard and GPU Joint Venture

Subject: UFTO Note – Ballard and GPU Joint Venture
Date: Fri, 20 Dec 1996 10:44:23 -0800
From: Ed Beardsworth

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

Below is a recent press release on a joint venture between Ballard and GPU. Ballard also announced receiving $30 Million from the Canadian government to support commercialization of stationary fuel cell power plants. —


Dec. 17, 1996

Ballard Power Systems and GPU International, Inc. (GPUI), a subsidiary of GPU Inc., a major international electric company based in New Jersey, announced today that they have formed a venture for the commercialization of Fuel Cell Stationary Power Plants using the Ballard Proton Exchange Membrane (PEM) Fuel Cell.

Under the terms of the agreement, which is subject to final regulatory approval, Ballard Power Systems has created a new subsidiary, Ballard Generation Systems Inc., to commercialize Fuel Cell Stationary Power Plants. Ballard Generation Systems will develop, market and manufacture Fuel Cell Stationary Power Plants worldwide and will be based in Burnaby, B.C. Ballard Power Systems, the parent company, will supply the fuel cells for these power plants. GPU International will invest US$23.25 million (Can$31.2 million) over the next two years in the subsidiary, Ballard Generation Systems, for up to a 19.3% share of Ballard Generation Systems, two 250 kW fuel cell power plants for field trials, and non-transferrable warrants to purchase 100,000 Common shares in Ballard Power Systems at a price of $27.45 per share.

In addition to GPUI’s investment in Ballard Generation Systems, it will bring to the company its considerable expertise in world energy markets and an understanding of user requirements which will contribute to the development of Ballard Fuel Cell Stationary Power Plants.

GPU International is the non-regulated arm of GPU, Inc. GPU serves a worldwide population of over 13 million people with 4.4 million customers located in 12 countries. It had 1995 revenues of over US$3.8 billion and assets of about US$10 billion. GPU, Inc. shares are on the New York Stock Exchange.

“Under growing deregulation, Ballard Fuel Cell Stationary Power Plants will become an important part of the energy market. These power plants will provide power for a broad range of market applications including Premium Power,” said Bruce L. Levy, President and CEO of GPU International. “We see that by combining Ballard’s clear lead in proton exchange membrane fuel cells and power plants with GPU’s expertise in the world energy business, we can together build a growing, successful and profitable business.”

“We are pleased to welcome GPU as a strategic partner and investor in our stationary power business,” said Firoz Rasul, President and Chief Executive Officer of Ballard. “GPU has distinguished itself as a leader in the deregulated electric power industry worldwide and has participated in the commercialization of innovative energy products and applications. Ballard Fuel Cell Power Plants will address the needs of the substantial markets that are emerging for environmentally clean, high quality power generated at the customer’s site.”

“GPU International has made investments in power-related projects throughout the world,” said GPUI’s Levy. “We feel that fuel cell power plants will open up considerable new markets in the power business within the next 5 years.”

“To marshal the resources needed to bring each of our products to market effectively, our plan is to join forces with a carefully chosen team of marketing and manufacturing partners,” said Mossadiq Umedaly, Vice President and Chief Financial Officer of Ballard Power Systems. “GPUI brings deep insight in the international electric power markets, which will contribute to the commercial success of Ballard Fuel Cell power plants. The equity participation by GPUI also enables Ballard to capitalize on the value of its stationary power plant technology beyond the fuel cell, and establishes the value for this subsidiary, before GPUI’s investment of $31.2 million at more than $130 million.”

Ballard Power Systems is the world leader in the development of proton exchange membrane fuel cell power systems. The heart of its products is the Ballard Fuel Cell, a proprietary zero-emission engine that converts natural gas, methanol, or hydrogen fuel into electricity without combustion. Ballard Fuel Cells are currently being used by leading international companies including Daimler-Benz, General Motors, Hitachi, Honda, Volkswagen and Volvo to develop zero-emission vehicles and clean stationary power plants.

Ballard’s Common shares are listed on The Toronto Stock Exchange under the trading symbol “BLD” and on the Nasdaq National Market System under the symbol “BLDPF”.

/For further information: Paul Lancaster, Ballard Power Systems Inc. (604) 454-0900, fax (604) 412-4700; Michael A. Lundy, Lundy Associates, Inc. (201) 660-1100, fax (201) 660-1104 or Patrick M. Dool, GPU International, Inc. (201) 263-6951, fax (201) 263-6977/ (BLD. BLDPF)

Ammonia Monitor for NOxOUT

Subject: UFTO Note — Ammonia Monitor for NOxOUT
Date: Tue, 17 Dec 1996 15:16:53 -0800
From: Ed Beardsworth

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

Our colleagues at NEES played a key role in supporting the development of this technology to reduce reagent use in the NOxOUT process by monitoring temperature and ammonia in the stack gas. Rui Afonso, who is quoted below, would be happy to discuss their views of it with you. (Rui can be reached at 508-389-3208.)

The device is commercially available for some applications, and could be used in other applications with some additional development. Note the one-year payback mentioned below. _____________________________________________

Here is a press release from the vendor:

New England Power saves money with SpectraScan Ammonia Monitor

December 3, 1996, Salem, MA – A SpectraScan(R) Ammonia Process Monitor, manufactured by Spectrum Diagnostix of Andover, Mass., has been operating on a New England Power Company (NEPCO) coal-fired boiler. The instrument is being used to monitor a new control logic employed by Nalco Fuel Tech (NFT) of Naperville, Ill. (Spectrum Diagnostix was purchased by BOVAR Inc. of Calgary, Alberta in June 1996.)

The new control logic that NFT provided to NEPCO is designed to reduce the consumption of reagent in the NOxOUT(R) process. The control signal is an accurate temperature measurement supplied by a SpectraTemp(R) temperature monitor, also manufactured by BOVAR.

According to NEPCO, the electric utility company is expecting to recover its investment in the new control system within one year or better. NEPCO is completing a trial period to quantify the benefits of the new control system.

According to Rui Afonso, NEPCO’s Manager of R&D, “At this stage, we are extremely pleased with the results that we have seen at Salem Harbor, unit No. 3. The instruments have been reliable and responsive, and the reagent savings appear to be better than initially expected. Long-term testing, which is currently underway, will further quantify the benefits of the technology.”

According to John O’Leary, Nalco Fuel Tech’s Manager of Technical Services, “The SpectraScan(R) Ammonia Process Monitor offers real-time monitoring of ammonia slip in the high temperature, dusty, and corrosive gas streams that typically exist in coal-fired boilers. Having evaluated every ammonia analyzer we are aware of, we have been very satisfied with the performance of the SpectraScan(R) Ammonia Process Analyzer in this application. Other analyzers have not offered the response, sensitivity, interference-free analysis, and robust design that are all necessary for our use. Along with SpectraTemp(R), we expect that the SpectraScan(R) Ammonia Process Analyzer will be a key component in many of our future NOxOUT(R) systems.”

SpectraScan(R) is a Tunable Diode Laser based instrument manufactured by BOVAR Western Research. SpectraScan(R) is a highly sensitive and interference-free analyzer that has adapted recent advances in diode lasers and optical fibers to the challenge of sensing trace concentrations of gas species in either an open path (perimeter) or close-coupled (in process) configuration.

The open path version of the instrument is accepted by the Petroleum Environmental Research Forum, a consortium of major oil refiners, for monitoring fugitive toxic gases.

By using up to one kilometer of fiber optic and signal conductor to link the System Console (which houses the laser and all electronics) with as many as four measurement locations, SpectraScan(R) offers real-time and continuous, remote sensing of trace gases without the need to transport the sample.

These features also permit remote monitoring of species in hostile environments. SpectraScan(R) is currently available for monitoring HF, NH3, H2S and H2O that may be present in trace quantities in process streams or ambient air. Monitors for other gas species are under development.

SpectraTemp(R) is an optical furnace exit gas temperature monitor manufactured by BOVAR Western Research. It is used at numerous utility boilers to control soot blowers and low NOx burners to improve heat rate and increase fuel flexibility. It is also used as a portable boiler testing instrument.

BOVAR Western Research, an operating division of BOVAR Inc., designs, manufactures, sells and services quality analyzers and systems for process and environmental monitoring and control. BOVAR Inc. is a public company which provides environmental and waste management services internationally. BOVAR Inc. is traded on the Toronto Stock Exchange under the BVR ticker symbol.

CONTACT: Jim Staudt, BOVAR Inc., 508-686-8801, (fax) 508-686-8809

Next Generation Wind Turbine

Subject: UFTO Note – Next Generation Wind Turbine
Date: Thu, 12 Dec 1996 17:03:33 -0800
From: Ed Beardsworth

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

This Summary was prepared for UFTO by the Wind Turbine Company. Complete details on their business plan and technical approach are available from the company. The company is seeking business partners and equity investment capital.



WTC’s 2-blade, downwind turbine design holds the promise of reducing the cost of wind generated electricity from its current level of 5¢/kWh to less than 3.5¢/kWh without resorting to available subsidies. WTC has significantly refined and improved upon the downwind design, incorporating proprietary technology, in a quest to reduce the initial turbine cost, the primary cost driver of wind energy, without sacrificing reliability. WTC’s turbine will weigh 60% as much as a comparably rated 3-blade, upwind turbine. Its lighter weight will permit WTC’s turbine to operate higher above ground (100 meters or more) than is economic for upwind turbines, thus exposing it to higher winds resulting in more energy production. Lower weight and higher energy capture combine to provide a substantial reduction in the cost of wind generated electricity.

WTC was selected by the Department of Energy’s National Renewable Energy Laboratory (DOE and NREL) to participate in Stage 2 (the hardware building stage) of the “Next Generation Turbine Development Project.” This is a $20 million project with the DOE picking up 70% of the cost. It will last 5-6 years. Two commercial wind turbines, the WTC 250 and WTC 1000, will be developed. As the result of its cost sharing, WTC will own all hardware produced.

A contract with NREL permitting work to begin on this project is expected by the end of December, 1996. To begin work, WTC needs to obtain initial funding for its share of the cost. WTC has identified two outside sources of funding and would like to identify one or two additional sources, one of which is ideally a strategic partner that can help commercialize the wind turbines when they are available.

The project will be executed in three phases corresponding to the development of three wind turbines:

In the “proof-of-concept” (POC) phase, WTC will manufacture and begin testing the POC 250, a 250 kW turbine. This turbine will demonstrate the technology that is novel to WTC’s design-WTC’s proprietary, hydraulically operated system in the turbine’s rotor that permits the cone angle between the blades to adjust depending on wind speed. Building the POC 250 will take approximately 12 months with an extended testing period to follow.

In the second phase WTC will develop the first full-scale 1000 kW turbine. This phase will begin in the second quarter 1998. During this phase, WTC will also develop an all new wind turbine blade for the 1000 kW turbine.

Concurrently, and independent of the NREL contract, WTC will refine the POC turbine with the intention of having the WTC 250 commercially available in early 1999.

3. The second full-scale turbine, the WTC 1000 production prototype, will be manufactured in the third phase. This turbine will be a commercial product.

To execute the project, commercializing the WTC 250 in parallel, WTC will have to raise approximately $12 million in equity funding over the next 5-6 years before reaching a break-even cash flow. This fund raising occurs in stages corresponding to the turbine development phases. Presently, WTC is raising $2 million by selling equity representing approximately 40% ownership of the Company. This will permit execution of the POC phase.

One of WTC’s current shareholders will participate in this financing, and WTC also expects a newly formed, electric utility-funded venture capital company to participate. Together these investors will account for a minimum of $1 million of the required initial funding, and could easily account for more. Both would like WTC to identify a strategic partner.

Markets for the WTC 250 and WTC 1000

The opportunity for the WTC 250 is in developing countries and in installations that are not grid connected. For example, the standard WTC 250 would be ideally suited for islands in the Caribbean, the Azores, etc., as well as mainland-based installations in Latin America and Asia. Primary considerations for this turbine are climates where fully weather protected maintenance is not critical, and where existing infrastructure such as roads, as well as the unavailability of large-size erection equipment, prohibit the installation of large wind turbines.

Many such installations are currently served by diesel generation units or are candidates for such units. Even in locations where diesel fuel is low cost, integrated wind/diesel systems will emit less pollutants and therefore should be viewed favorably by customers.

One modification to the WTC 250 which has been considered is the development of a cold weather version. Though the market for this wind turbine is a subset of the market for stand-alone systems, it is a high value opportunity. In many remote, cold weather locations, the cost of delivering diesel fuel is high.

WTC believes it can sell a limited number (20+/-) WTC 250 wind turbines in early 1999, generating its first revenue from commercial sales. Specific customers for these turbines have not been identified, however, a number of opportunities exist including the DOE/Electric Power Research Institute sponsored Turbine Verification Program. The US military is also known to be considering use of renewable energy technologies.

The opportunity for the WTC 1000 is large scale, grid connected applications. At present, and for perhaps the next 5-10 years, this market will be primarily in North America and “off-shore” in Europe. If the WTC 1000 achieves its cost and energy production targets, it will be competitive in the deregulated North American marketplace. Initially, it will displace higher cost sources of electricity from the grid when the wind is blowing. Storage technologies will eventually improve to the point where wind energy will become a major contributor in the North American electricity system.

During the next 3-5 years, however, there will be limited opportunities for new wind energy projects in North America as the generation industry deregulates and excess capacity is absorbed. This is the period during which WTC will be developing its new technology. By the time the WTC 1000 is available for commercial sale in the year 2000, the US market for low-cost wind energy will be rebounding.

The immediate opportunity for wind energy will be presented by the closure of aging nuclear power facilities. WTC believes the public will not accept a lessening of air quality as the price for a more competitive electricity market. Thus, in spite of an abundance of coal in North America, natural gas will to continue to be the fuel of choice. If the WTC 1000 achieves its cost objectives, electricity generators will turn their gas turbines off when the wind is blowing.

For more information please contact:

Larry Miles, President
The Wind Turbine Company
515 – 116th Avenue NE, Suite 263
Bellevue, WA 98004 USA
telephone: (206)637-1470
facsimile: (206)637-1483

UFTO WEB SITE (beta) up and running!

Subject: UFTO WEB SITE (beta) up and running!
Date: Fri, 06 Dec 1996 09:02:10 -0800
From: Ed Beardsworth

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

The UFTO Web site is operational, and ready for you to take a test drive. Go to:

Behind the public home page, the good stuff is in a members only area requiring password access.

There you’ll find the UFTO TOPICS Database with a full feature search engine. It contains 408 data records of the UFTO Topics database, from the first results in 1994 thru to the DOE SBIR conference of October ’96.

1. The primary purpose of the web site, at least initially, is to provide access to the database.

2. It is for the use of UFTO member companies only. Anyone in your company can register to request access. This results in an email note to me. Then I need to access the server and add the user’s name and password, so this won’t be instantaneous. I’ll try to do this promptly, and notify you when they’re ready.

3. Please run the search engine thru its paces, and explore the data a bit, and let me know if you run into any snags.

4. The data is the same as you’ve seen in the UFTO Topics reports (e.g. T&D, Nuclear, etc.), and data records have been coded to enable you to select them by “Topic”, and essentially recreate updated versions of those Topic Reports.

5. It shows you a list of search hits and then you ‘view one record at a time’ — which is fairly standard. There will be future enhancements, particularly to provide better output capabilities.

So! Have a look! Let me know how it looks to you.