Bloom Energy defends deal as Delaware considers new permit application (Karl Baker)
This story begins with impressions of “Bloom Energy’s secretive assembly floor in Newark, Delaware at the UD Star Campus. It’s described as “striped with tape” and a “complex maze of walkways and workstations.” In a media tour, Bloom officials reportedly described the facility as “the only advanced fuel cell manufacturing plant in the world.” Photos are prohibited, lest potential competitors, notably Chinese firms, be enabled to steal Bloom's intellectual property.
OK, jobs have run below forecast, and the Qualified Fuel Cell Provider (QFCP) tariff has cost Delmarva Power ratepayers considerably more than was originally estimated.
Yet “in a rare public defense on Thursday, Bloom Energy officials argued that the incentives have been a good deal for Delaware. The occasion was a DNREC “public meeting in New Castle to consider a permit application that would allow Bloom to swap out its old fuel cells in Ogletown [Red Lion] and Newark [Brookside] for new ones.”
The cost of replacing the existing fuel cells hasn’t been publicly stated, but is understood to be “between $100 million and $150 million.” When the proposed transaction was announced, Bloom’s public stock price “plummeted”. It currently is trading at about $12.50 per share, some 60% below the all-time high in September and also below the $15 IPO price.
As for what happened at the hearing, this story reports the following: “At the DNREC public meeting, Bloom Energy’s critics insisted that the company’s deal has been bad for Delaware. Company employees countered that the state subsidies, which brought Bloom to Delaware, have enabled them to achieve middle-class livelihoods.”
The story goes on to observe that “the waste from Bloom’s electricity production has been controversial for years.” Thus, on its Coastal Zone permit application for the Red Lion facility (most of the 30KW capacity), Bloom represented that the proposed facility would not “result in the generation of any hazardous waste as defined by the Delaware regulations governing hazardous waste.” The EPA later disagreed, however, and DNREC eventually “told Bloom that Bloom’s “desulfurization units” should be treated as hazardous waste when removed from fuel cells.
“Asked at the public meeting on Thursday what Bloom does with the waste, company spokesman David McCulloch said Bloom needs to pull certain contaminants out of natural gas before it can fuel its electricity generators.”
It’s not entirely clear why Bloom wants to proceed with the fuel cell replacement project, nor what the implications would be for Delmarva Power ratepayers (would the QFCP tariff go up, go down, or remain the same?). Furthermore, the handling of solid hazardous waste from the fuel cells has never been satisfactorily explained (and most certainly wasn’t explained at the public meeting). These and the other issues raised by Bloom's critics should be fully addressed before any action is taken on the permit application.