Itm Power Regulatory News (ITM)

4 October 2011

ITM Power plc

("ITM Power" or "the Company")

High Power Density Fuel Cell Results

Automotive Partner Evaluation Programme

ITM Power (AIM: ITM), the energy storage and clean fuel company,is pleased to announce the outcome of a recently completed nine month fuel cell project. The project focused on ITM Power's proprietary hydrocarbon membrane materials and their evaluation in high power density hydrogen/air fuel cells and was supported by the Carbon Trust as part of the Polymer Fuel Cells Challenge. The project objectives, which were defined by automotive industry experts, were all achieved.

ITM Power is now engaging with automotive OEMs and key organisations in the fuel cell supply chain to undertake early stage qualification of its membrane materials as part of the Company's Partner Evaluation Programme. The next phase of the process will involve accelerated acquisition of test data while undertaking full life cycle cost analysis via the Carbon Trust's cost model.

Increasing power density is widely accepted as the single most important factor in reducing the cost of fuel cells. ITM Power's materials have shown the ability to generate unprecedented power density when using either oxygen (>5.5W/cm2) or air (>2.1W/cm2). This project consolidated this capability by examining the impact of operating in environments and conditions required by the automotive industry. This included sensitivity to reduced catalyst loading, gas pressure, humidity, temperature and stoichiometry. In addition, longevity studies were initiated and benchmarking was carried out against industry standard materials.

The project was undertaken at a single test cell level and sought to reduce the technical risk presented by ITM Power's materials as a new component.

Further information on evaluation programme results and ITM Power's high power density fuel cell membrane technology

Power Density

During the course of the project, the fuel cell power density when using air has been increased by one order of magnitude. Catalyst loadings as low as 0.38mg/cm2 have been successfully operated with dry gases down to 0.34bar (5psi) pressure. In addition, high power density has been developed at higher cell voltages providing higher overall conversion efficiency. Some notable results include:

·; Power density of 1.5W/cm2 at >600mV

·; Power density of 1.0W/cm2 at >700mV

·; Membrane conductivity over three times that of industry standard membranes

·; No irreversible degradation during short durability tests

The achievement of high power densities is of clear value. ITM Power's materials retain this important benefit at the low catalyst loadings and reduced operating pressures that the automotive industry requires. This is in addition to the other positive attributes of ITM Power's materials, including reduced cost and ease of manufacture.

Durability Results

Durability results are highly dependent on cell structure and flow field design. It has been a challenge to maintain the process conditions within the test cell using existing equipment to undertake extended durability tests. However, during the evaluation programme, no irreversible degradation was observed when comparing ITM Power's MEA (membrane electrode assembly) performance before and after testing. While high MEA efficiencies are achieved, the unusually high current densities present new challenges in terms of flow field and electrode design.

An important challenge facing fuel cell membrane materials is the ability to maintain adequate water content for effective ionic conduction. This often necessitates the use of balance of plant to humidify input gas streams. One of the advantages offered by ITM Power's fuel cell materials is an additional hydrophilic component which serves to hold water inside the polymer structure and rendering it extremely water attracting and less prone to drying. The key power density performance data presented was achieved with dry gases.

Mechanical Properties and Dimensional Stability

ITM Power's materials are cross linked. This provides good dimensional stability and contributes to robust overall mechanical properties. In addition, the ITM Power material has an ionic conductivity over three times that of industry standard membranes. This allows comparatively thick membranes to be used adding further mechanical robustness. As the membrane material is cast from a liquid mixture, it is compatible with reinforcing structures such as webs, cloths or mats.

Demountable Structure and Catalyst Recycling

It is crucial for effective MEA function that the catalyst makes good interfacial contact with the membrane. The nature of ITM Power's materials offers multiple convenient routes for achieving excellent contact. Firstly, the membrane material is very compliant and so enables a simple pressed contact within the cell to deliver exceptional performance without the need for a hot pressing stage. This in turn offers a way to reclaim catalyst easily at the end of MEA life. Furthermore, recycling hydrocarbon materials is much easier than for fluorocarbons as there is no release of fluorine or hydrofluoric acid.

Manufacturing routes

ITM Power's materials are polymerized by ultraviolet light, a low cost process which is compatible with volume production techniques and well understood by industry. There is no requirement to add an additional hot pressing stage to MEA fabrication as catalyst coated electrodes make excellent contact in a simple pressed arrangement. Multiple routes for incorporating catalyst structures into the surface of the membrane during the polymerization process have been explored and shown to be viable. In addition, spraying an ink containing ITM Power's ionomer onto a pre-cured membrane is possible. ITM Power is exploring partnering with large polymer processing companies.

Industry Performance Targets

The mass roll out of Fuel Cell Electric Vehicles is scheduled to begin in 2015 and the industry has set a number of challenging performance and cost targets as guidelines for the Automotive Fuel Cell supply chain. One review, undertaken by NOW, identified a performance target of 1W/cm2 at 670mV as being an aspiration for OEMs. The same report concluded that the performance was not currently achievable. ITM Power has exceeded this power density target.

Performance and Full Life Cost Modelling

The drivers for the adoption in automotive applications are a complex set of performance, reliability and cost criteria. However, the availability of high power density fuel cells at low cost would enable more compact integration of fuel cell drive trains into a variety of vehicle platforms and reduce vehicle weight per kW of power delivery. The results obtained by ITM Power's materials will be independently analysed via a comprehensive cost model developed by the Carbon Trust. This will enable costs to be projected and described in $/kW. The outcome of these analyses will be made available once complete. Durability results will be the last step in understanding the full life cost advantages of the ITM Power membrane technology.

Automotive Partner Evaluation Programme

ITM Power is pleased to announce today the development of its Partner Evaluation Programme with both automotive OEMs and also significant organisations within the automotive Fuel Cell and MEA supply chain. A number of confidentiality and sample evaluation agreements have been signed and some independent analysis is being undertaken. This approach enables end users to initiate qualification procedures under their own test conditions and environments. During this phase, ITM Power seeks to accelerate MEA development by accessing expertise, facilities and feedback from key organisations. Of particular benefit will be progression to larger scale test cells.

Commercialisation and Business Model

Commercialisation of ITM Power's novel MEAs will be using a licensing business model. The Partner Evaluation Programme is the first step in the commercialization process. ITM Power intends to build on early relationships with potential end users and seek routes to jointly develop the materials with partners with skills and experience which could further accelerate progress.

Commenting for ITM Power, Graham Cooley, CEO, said: "The enthusiasm that has been shown by the automotive industry and fuel cell supply chain for the MEA developments has been very encouraging. We now move to OEM partner evaluation to demonstrate our MEA performance as a first step to commercialization."

Commenting for the Carbon Trust, Robert Trezona, Technology Director, said: This project has been a huge success. The progress made by ITM Power over the course of 9 months is significant and is testament to the capability of its materials technology. The Carbon Trust is delighted to have assisted with this achievement and looks forward to providing further introductions and downstream industry cost analysis.

For further information please visit www.itm-power.com or contact:

About Carbon Trust:

The Carbon Trust is a not-for-profit company with the mission to accelerate the move to a low carbon economy. We provide specialist support to help business and the public sector cut carbon emissions, save energy and commercialise low carbon technologies. By stimulating low carbon action we contribute to key UK goals of lower carbon emissions, the development of low carbon businesses, increased energy security and associated jobs.

About ITM Power:

ITM Power designs and manufactures Hydrogen Energy Systems for Energy Storage and Clean Fuel production. ITM Power has grown from its original platform of novel polymeric electrolytes (for water electrolysis and hydrogen fuel cells) to that of a technology provider. ITM Power now has both a strong base of intellectual property and engineering expertise for providing complete hydrogen solutions and CE marked products for sale.