AFC Energy Regulatory News (AFC)

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11 November 2019

AFC Energy PLC

("AFC Energy" or the "Company")

AlkaMemTM Anionic Exchange Membrane Opens New Markets for AFC Energy

AFC Energy (AIM: AFC), a leading provider of hydrogen power generation technologies, is pleased to provide an update on its proprietary AlkaMemTM anionic exchange membrane development programme as used in the Company's leading high-current density alkaline fuel cell, HydroX-Cell(S)TM.

Highlights 

·; AlkaMemTM has delivered market leading conductivity within an alkaline fuel cell environment enabling the achievement of >1A/cm2 power density within the HydroX-Cell(S)TM testing programme.

·; AlkaMemTM set to be a truly disruptive technology in the field of alkaline water electrolysis with evidence supporting a sizable increase in hydrogen production efficiency.

·; Industrie De Nora S.p.A confirms AlkaMemTM performance "exceeded internal expectations" following independent validation testing at research facilities in Japan, endorsing the significant upside potential in alkaline water electrolysis applications.

·; Additional applications for AlkaMemTM include energy storage (Redox Flow batteries).

·; Prototype membrane manufacturing capability in place at AFC Energy's Surrey headquarters.

Opportunities

·; As a key component of the HydroX-Cell(S)TM alkaline fuel cell, affording opportunities across new power-dense market segments that AFC Energy were previously unable to penetrate.

·; Commercial enquiries already received for prospective licensing or sale of AlkaMemTM membrane technology into non-fuel cell markets, including alkaline water electrolysis.

·; AFC Energy open to further expressions of interest from licensors and market development partners of the AlkaMemTM technology in non-fuel cell applications.

·; Global revenues from the sale of ionic membrane technologies, such as NafionTM used in Proton Exchange Membrane (PEM) fuel cells and electrolysers, estimated to be over US$1bn per annum.

The key enabler technology within AFC Energy's HydroX-Cell(S)TM fuel cell platform is the anionic exchange membrane, AlkaMemTM. The Company's AlkaMemTM solid membrane acts in the same manner as similar acidic membranes used in PEM fuel cells, albeit with the distinct advantage of utilising a lower grade, and therefore lower cost, Hydrogen source.

The value proposition for the AlkaMemTM membrane however extends well beyond the fuel cell.

With applications in Alkaline Water Electrolysis (to generate Hydrogen), electro-dialysis, salt-splitting and energy storage (including Redox Flow batteries), the anionic membrane is relevant across several high value industries, offering excellent value for money.

The AlkaMemTM technology potential was validated and tested at Industrie De Nora S.p.A research facilities in Japan earlier this year in an Alkaline Water Electrolysis application. Initial testing of AlkaMemTM has shown the market leading potential of this membrane in this application when compared to alternative separators in the market today.

Commenting on the AlkaMemTM testing undertaken in Japan, Christian Urgeghe, Chief Technical Officer at De Nora, said, "A highly conductive and stable anionic exchange membrane opens up an array of technologies which De Nora currently have under development. Based on internal De Nora testing standards, the AlkaMemTM membrane technology exceeded internal expectations and has demonstrated the ability to offer significantly lower voltage drop when compared to widely implemented industry standard diaphragms."

The AlkaMemTM membrane will come in three thicknesses reflecting the needs of different applications, but shall all be based on the same technology and manufacturing process:

·; 20µm

·; 40µm

·; 100µm

Having already established a prototype membrane manufacturing capability in Surrey, the Company is continuing initial integration testing and development with the HydroX-Cell(S)TM fuel cell programme.

AFC Energy has commenced and welcomes new discussions with third parties interested in the commercial application of AlkaMemTM whether through licensing and / or co-development partners into non-competing fuel cell applications such as Alkaline Water Electrolysis.

A key number of success criteria were identified for AlkaMemTM in advance of commercial sales with several of these already having been demonstrated, including conductivity, ion selectivity and operating temperatures. Focus in 2020 now resides in demonstrating the longer-term stability of the membrane across key market-based applications.

NafionTM, a membrane developed for the PEM fuel cell market and other PEM based water electrolysis and electro-chemical processes, is understood to achieve annual sales in excess of US$1billion, confirming a significant market size for highly conductive membrane technologies.

Adam Bond, Chief Executive Officer at AFC Energy, said "We have been working on the AlkaMemTM membrane over the past 24 months and have now made significant strides forward in demonstrating the commercial value this technology can bring to AFC Energy. From our technology development roadmap, we have been delighted by the number of commercial success criteria the AlkaMemTM technology has already evidenced both in fuel cell and alternative applications. We have also been encouraged by the early market interest shown in the product and its applications".

"With strong growth expected in alkaline water electrolysis in the coming years and the already evidenced expansion of energy storage, we believe AlkaMemTM, whilst initially developed exclusively "by us, for us", offers a true value proposition which we will aggressively seek to exploit through a sales, partnership and licensing model with our customers."

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About AFC Energy

AFC Energy plc is commercialising a scalable alkaline fuel cell system, to provide clean electricity for on and off grid applications. The technology, pioneered over the past twelve years in the UK, is now being deployed in electric vehicle chargers, off-grid decentralised power systems and industrial gas plants as part of a portfolio approach to the decarbonisation of local electricity needs.