Itm Power Regulatory News (ITM)

10 Jan 2006 07:00

ITM Power PLC10 January 2006 Embargoed, for release at 0700h, 10 January 2006 ITM Power Plc Technical Update - Progress Against Milestones ITM Power Plc ("ITM" or "the Company"), which aims to provide enablingtechnology for the hydrogen economy was admitted to AIM in June 2004. At thattime, the Company set out in the IPO prospectus a number of technical milestonesagainst which shareholders would be able to measure progress. These milestoneswere: (i) a 20 watt flexible fuel cell June 2005 - successfully achieved and announced on 30th June 2005(ii) a 250 watt electrolyser to be achieved by December 2005(iii) a 250 watt fuel cell, also to be achieved by December 2005(iv) a 500 watt electrolyser by June 2006 ITM today announces the fulfilment of the three remaining technical milestones(ii, iii & iv above). Electrolyser Developments During the past two years, it has become apparent to the Company that theabsence of a low cost, durable electrolyser is the single largest technicalobstacle to the implementation of the hydrogen economy. If available, such anelectrolyser would control the supply of fuel from time-varying renewableresources (wind, wave and solar) and thus provide the potential to transform theeconomics of the existing alternative energy supply system. PowerAs a consequence, ITM has devoted considerable effort to its electrolyserprogramme. This effort has resulted in the production of an electrolyser (theITM Mark 4) which the Company is pleased to announce has been operated in excessof 500 watts input as a steady state rating and at 1kW on a transient basis. ITMtherefore believes that it has achieved both of the outstanding electrolyserobjectives set out at the time of the IPO. LongevityThe Mark 4 electrolyser employs the patented ITM ionomeric materials, which havebeen subject to longevity testing and for which 500 hours was announced on 3rdOctober 2005. These tests are ongoing and the Company is now pleased to announcethat the material has achieved in excess of 1000 hours of operation without external evidence of failure; these longevity tests continue. CostsIn June 2004, ITM made public an estimate of production costs for the thencurrent electrolyser design (the ITM Mark 3), which was independently estimatedto be capable of production for US$283/kW. An independent costing analysis(currently in draft) has now been provided for the improved technology used inthe Mark 4 device. This has allowed the Company to estimate a cost of productionof US$275 per kW for a device produced at the rate of 100,000 1 kW units perannum. Fuel Cell Developments PowerThe Company has successfully developed a hydrogen/oxygen fuel cell stack thathas achieved a peak power output in excess of 250 watts (fulfilling ITM's poweroutput IPO milestone) using conventional fuel cell architectures and somerecently developed proprietary radiation grafted materials (Technical Update30th August 2005). The system was not optimised for cost, efficiency or size.ITM believes that following further work, it will be able to build such higherpower fuel cell stacks using the Company's patented one shot production processand low cost materials with a number of different fuel options. The precisetiming and nature of this fuel cell development work will depend on the outcomeof the durability testing of the Company's patented materials, which is ongoingin the electrolyser programme. Jim Heathcote, ITM's CEO, commented: "One of the most exciting aspects of ourprogress to date is the outstanding success of the electrolyser programme. Ibelieve that this technology holds the key to the efficient integration ofrenewable non-oil energy supplies into the existing energy system. However, forthis to happen, low cost-over-life modular electrolysers are needed.Cost-over-life is directly determined by initial capital cost and durability inreal life environments and that is why the independent costing of ourelectrolysers and the longevity trials - now at 1000 hours of operating time inan intermittent operational cycle - are so encouraging. "In the fuel cell programme, we have achieved all the original IPO objectivesand have additionally demonstrated ITM's ability to make fuel cells whichoperate using all the commercially significant fuel systems now underdevelopment (hydrogen-oxygen; alcohol, and sodium borohydride). Our portfolio ofpatented intellectual property and know-how give us a potentially invaluablebase from which to begin the next development phase of the Company." A briefing on the technical update will be held at 12 noon today for analystsand investors at Tavistock Communications, 8th Floor, 131 Finsbury Pavement,London, EC2A 1NT, please contact Gemma Chandler or Simon Hudson if you wouldlike to attend. -Ends- For further information please contact: Jim Heathcote Gemma Chandler / Simon Hudson Katherine RoeITM Power Plc Tavistock Communications Panmure Gordon & CoTel: 01799 532860 Tel: 020 7920 3150 Tel: 020 7459 3600 or visit www.itm-power.com Notes to Editors---------------- About the hydrogen economy and ITM Power: ITM is a leading technical innovator of fuel cell and electrolyser technologiesfor the hydrogen economy. The future shape of the energy industry is being driven predominantly by thegrowth in the global demand for energy, the diminishing reserves of oil and bythe environmental impact of burning fossil fuels. Hydrogen Economy: • Term used to describe the use of hydrogen as a critical element in the energy economy of the future. • Benefit of hydrogen is that it has the potential to a be a totally "clean" source of fuel • The vision is that low cost electrolysers produce hydrogen from "clean" energy sources such as solar, wind and wave and fuel cells use this hydrogen to produce the electricity when it's required "If all the sunlight hitting the earth's surface in one hour was harnessed andconverted into electrical power, it would be enough to fulfil mankind's energyneeds for a complete year" - BP Solar Electrolysers, via an electrochemical process, convert electricity (fromrenewable energy inputs) and water into hydrogen (which can be stored) andoxygen and in turn fuel cells, via a similar process convert hydrogen and oxygeninto electricity and water. ITM announced in November 2004 that it had successfully produced and tested aMark III electrolyser stack, which has been operated at a power rating in excessof 200 Watts and has now achieved its milestone of 500 Watts. On the basis ofthe Mark III results, The Generics Group, an independent scientific consultancy,have estimated that in mass production it is possible to achieve US$283 per kW.This is below the 2010 US Department of Energy target of $300 for anelectrolyser stack. PEM fuel cells developed so far are currently estimated to cost several thousanddollars per output kW (for example, in February 2004, the US Department ofEnergy estimated the current cost of a fuel cell to be approximately $3,000 peroutput kW) whereas petrol engines are currently estimated at $50 per output kW. ITM's Technology: ITM Power plc believes it has developed and patented the keys to revolutionisethe hydrogen economy and is set to become one of the UK's leading innovatorswithin the alternative energy sources industry. ITM's ionically conductive polymer materials and manufacturing processes areused in the production of fuel cells and electrolysers, which are significantlycheaper than those presently used in production. The technology offers highconductivity, hydration control and has the benefit of catalyst recycling. TheCompany has the ability to produce low cost fuel cells that meet the energydemands of a wide range of industries and specialist technologies includingmilitary, automotive and stationary fuel cell markets as well as the capacity toproduce household items such as laptops, mobile phones and domestic appliances. ITM has patented a new manufacturing process that allows a fuel cell/electrolyser stack of cells to be made in a single process similar to a massproduction casting process. The process is capable of producing cells or stacksof any shape that may also be flexible so that they can be moulded into smallerproducts, such as mobile phones. The Company has applied this technology to alow cost electrolyser that can convert carbon free energy into clean hydrogenfuel on site and on demand, therefore completing the circle of the manufacturingprocess. This information is provided by RNS The company news service from the London Stock Exchange