Today’s fuel cells boast longer lifetimes and shorter payback periods than their predecessors.

Despite this increasing affordability, the technology has yet to gain wide acceptance among alternative energy consumers.

However, fuel cells are poised to gain support as more industries find ways to defray their utility costs with the cells’ heat and power generation.

Where to Use Them

Fuel cells are most efficient in applications where both the heat and power are used. Hotels, health clubs, and spas are natural fits because they consume large amounts of heat and power, but many other industries can reap benefits from the technology as well.

Cafeterias, laboratories, medical centers, and multifamily developments could power buildings with the electricity generated and provide domestic hot water warmed by the cell’s heat.

The Octagon – Roosevelt Island, NY Size: 550,000 square feet, including 500 rental apartments Amenities: Heated outdoor pool, child daycare, fitness center, open-air tennis courts, club room, art gallery, general store, internet lounge LEED Certification: Silver Energy Needs: Base load of 600 kW with 24/7 demand for heat and hot water Efficiency and Utilization: Provides electricity to all residents and common areas with excess returned to the grid without reimbursement; 70% of waste heat utilized for domestic hot water and space heating Cost: $3.7 million, including $2.1 million for purchase and installation of the cell and integration with the existing system Incentives: Federal tax credits ($1 million), NYSERDA DG CHP Demonstration Program grant ($1.2 million upfront)

Applications with large power needs relative to their space, like data centers, could benefit greatly from the efficiency – about 42% for power, plus additional savings from heat recovery – while utilities could use power for grid stabilization or support. They can also be combined with existing solar or wind installations to ensure more reliable power delivery.

“Supermarkets are huge power users, and they get a lot of negative feedback about all the energy they pour into aisleways,” says Mike Upp, vice president of marketing for ClearEdge Power, a manufacturer of fuel cells for residential and small commercial applications. “That’s an industry where you’re going to see it adopted fairly quickly.”

Architect Bruce Becker, president of Becker + Becker, has deployed 400 kW fuel cells for both power and heat at two of his firm’s properties: in the construction of 360 State Street in New Haven, CT, and as a retrofit project at The Octagon in Roosevelt Island, NY. Both are LEED-certified structures with 500 residential units and some retail.

The properties now pay just 6 cents per kilowatt for natural gas to fuel the cells, a steep drop from 22 cents, the average retail price for grid electricity in the area. This substantial savings will cut $200,000 to $300,000 off of each property’s utility bill annually. With a 30% federal tax credit on each and substantial grants from both Connecticut and New York, Becker + Becker is set to achieve a payback of four to five years, well within their target range.

“Last month, the utility bill was $45,000 less than this month the prior year,” Becker says. “There are a lot of reasons to use these – environmental, efficiency, and energy policy issues – but there’s a sort of basic economic motivation to it too.”

360 State Street – New Haven, CT Size: 700,000 square feet, including 500 rental apartments Amenities: Half-acre green roof with heated pool, art gallery, library, fitness center, yoga studio, theater, communal living room and kitchen, business center, children’s playroom LEED Certification: Platinum Energy Needs: Base load of 475 kW with 24/7 demand for heat and hot water Efficiency and Utilization: Provides electricity to all common and commercial areas at 65% of the fuel cell’s capacity, with excess sold back to the utility grid; 90% of the cell’s waste heat is used for domestic hot water, space heating, and pool heating, with excess stored in thermal storage tanks Cost: Total investment of $3.5 million, including $1.8 million for the cell itself Incentives: Federal fuel cell tax credits ($1.2 million), Connecticut CEF fuel cell grant ($985,000), renewable energy certificate sales (approximately $50,000 per year), discounted gas rate

How to Navigate the Market

Costs vary from $4,000-$12,000 per kilowatt, though incentives are available, according to Mike Brown, vice president of government affairs and general counsel for UTC Power, which manufactures fuel cells for larger buildings and other large-scale applications. The price will likely drop as fuel cells gain wider acceptance, he adds.

“As people focus more on carbon and the cost of emissions, fuel cells will see more traction in the marketplace,” Brown says. “We’re right at the breaking point as far as cost to the consumer goes, and if we could get down to $2,500 to $3,000 a kilowatt, these would fit very nicely into a lot of applications, including some that might be somewhat borderline at today’s pricing.”

You can generally expect a life of about 20 years out of your fuel cells, though it will probably be necessary to replace the cell stack after 10 years.

“Even if the whole unit was no longer functional after 10 years, it would still make economic sense,” Becker says. “We were also attracted to fuel cells because of the environmental benefits – there’s no combustion with a fuel cell the way there is with other forms of combined heat and power, and these are residential properties, so I didn’t want to create pollution on-site.”

Becker is currently evaluating the feasibility of installing smaller fuel cells on two more properties. The Octagon and 360 State Street are essentially grid-independent for power, though both are connected to the grid in case the fuel cells go down or require maintenance. Becker hopes a smaller fuel cell system will spread these benefits to additional buildings.

“I’m surprised that more owners and architects haven’t been using fuel cells because they’re such a green, economical solution,” Becker says. “In an age when there’s such an importance placed on the environmental impact of energy use, there’s nothing that comes close to the environmental superiority of fuel cells.”

Janelle Penny (janelle.penny@buildings.com) is associate editor of BUILDINGS.