Solid Oxide Fuel Cell Market

Solid Oxide Fuel Cell Market Size, Share, Growth Report & Forecast

[231 Pages Report] The global solid oxide fuel cell market is estimated to grow from USD 1.4 billion in 2023 to USD 5.4 billion by 2028, growing at a CAGR of 31.0% during the forecast period. Supportive government policies and subsidies for R&D and rising adoption in applications such as power generation play a vital role in the growth of the solid oxide fuel cell market. Power generation accounts for ~40% of all CO2 emissions in Asia Pacific countries such as Japan, South Korea, and China. Using Hydrogen as a fuel for the power generation sector will reduce carbon emissions; the government in these countries aims to cut emissions by 40% & 39% in the commercial & residential sectors by 2030, respectively. Thus, there is expected to be increased adoption of stationary fuel cell systems in the power generation sector.

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Solid Oxide Fuel Cell Market Growth Dynamics

Driver: Introduction of stringent carbon emission norms

SOFC is a clean technology incorporating conventional fuels, such as natural gas. They have a negligible level of carbon emissions than other types of natural gas-fired technologies used typically for power generation. This is due to the direct conversion of chemical energy into electrical energy without a combustion process. One of the key drivers for the demand for low-emission technologies, such as SOFC, is stringent carbon emission norms prevalent across multiple regions. North America, Europe, and Asia Pacific have formulated several strict regulations to limit carbon emissions from power generation operations. Such regulations also specify the permissible diesel generator noise levels to reduce noise pollution caused by diesel genset operations. Different countries/regions have their own set of regulations and policies.

For example, the US Department of Energy (DOE) has announced plans to offer up to USD 32.5 million in federal funding for cost-shared R&D to promote SOFC technology in 2021. Furthermore, California's Self-Generation Incentive Program (SGIP) provides generator rebates to assist both present and emerging distributed electricity generation. California had set a USD 1 billion budget for SGIP till 2024; the most recent development is the Energy Division's SGIP Renewable Generation workshop in November 2020.

Restraint: Availability of alternatives

SOFCs have a lower market share in the entire fuel cell market due to the restricted number of end-use applications they can serve. Proton exchange membrane fuel cells (PEMFC) dominate the industry, accounting for at least 65% of total market share due to its versatility in a variety of end-use applications. PEMFC and direct methanol fuel cells (DMFC) are more suitable for military applications, particularly in portable and unmanned systems, due to their lower operating temperatures. Other technologies, including molten carbonate fuel cells (MCFC) and phosphoric acid fuel cells (PAFC), compete with SOFC technology in the United States, Japan, and South Korea. MCFC technology faces significant competition from SOFC in terms of installation cost per kilowatt and applications, such as combined heat and power (CHP) and power.

Opportunities:  Increasing electricity consumption in data centers

Data centers and the commercial and industrial sectors are among the most rapidly expanding end consumers of power generation systems in the US. Data centers use a lot of power. Furthermore, data centers require constant electricity to prevent the loss of vital data. The International Energy Agency (IEA) estimates that data centers would consume around 240-340 TWh of electricity in 2022, accounting for nearly 1-1.3% of global electricity demand. Because of the high power consumption, data centers seek cost savings by implementing distributed power generation, notably fuel cells. Fuel cells, especially SOFCs, have already experienced significant growth in the US. Its adoption for data centers by Google (US), IBM (US), and Equinix (US) has stimulated growth at the fastest rate. Currently, the overall SOFC adoption by data centers is still minuscule with respect to the total data centers in the US, making it one of the most lucrative businesses. In the military sector, stationary and portable power generation by SOFCs is on the rise. Additionally, the need for noiseless and efficient power generation for military applications creates an opportunity for SOFCs in this segment. Military & defense end users are increasingly adopting SOFC-powered devices for portable applications.

Challenges: Fuel cell degradation and carbon dusting

Solid oxide fuel cells encounter many challenges due to their high operating temperatures of over 1,000°C. Maintaining temperature is strongly tied to performance, and the likelihood of material degradation is a major concern. The variation in oxygen partial pressures necessitates distinct materials for the anode and cathode, making material stability critical. Maintaining the stability of solid electrolytes in low-oxygen partial pressures and reducing the possibility of electrolytes reacting with other components are additional important considerations. The likelihood of degradation, caused by variations in the size and shape of nickel particles due to sintering and morphological changes in the anode, generates stress and leads to fuel impurities and cracking during redox cycling.

Also, maintaining stability in interconnects in oxidizing and reducing environments, as they are exposed to anode and cathode, is challenging. Ceramic interconnects provide higher stability than metallic interconnects but at a higher cost. One of the concerns while using ceramic interconnects is carbon dusting. Finally, ensuring the matching of the coefficient of thermal expansion of sealant with other SOFC components is also crucial. These material challenges associated with solid oxide fuel cells will likely pose a significant challenge for the SOFC market.

Solid Oxide Fuel Cell Market Ecosystem

Prominent companies in this market include well-established, financially stable solid oxide fuel cell manufacturers. These companies have been operating in the market for several years and possess a diversified product portfolio, state-of-the-art technologies, and strong global sales and marketing networks. Prominent companies in this market include Bloom Energy (US), AISIN CORPORATION (Japan), KYOCERA Corporation (Japan), MITSUBISHI HEAVY INDUSTRIES, LTD. (Japan), and MIURA CO., LTD. (Japan).

The planar, by type, is expected to be the largest segment during the forecast period.

This report segments the solid oxide fuel cell market based on type into two types: planar and tubular. The planar segment is expected to be the largest segment during the forecast period. Because of its compact structure, the planar solid oxide fuel cell demand is likely to be significant. As its construction is relatively simple, it is the most commonly used solid oxide fuel cell type. Planar SOFCs are extensively used in stationary power applications due to superior power densities and heavy system designs. The key players that manufacture SOFCs with planar geometry include Bloom Energy (US), Sunfire GmbH (US), SOLIDpower S.p.A. (Italy), and Convion Ltd. (Finland). Tubular SOFCs are suitable for portable applications due to their mechanical strength and rapid start-up periods. Even though planar geometry SOFCs are a more mature technology than tubular SOFCs, the increasing need for power-hungry portable devices is expected to drive the tubular SOFC market throughout the anticipated period.

By end user, the data centers is expected to be the fastest growing during the forecast period

This report segments the solid oxide fuel cell market based on end user into four segments: residential, commercial & industrial, data centers and military & defense. The data centers is expected to grow at the fastest rate during the forecast period.  The market for solid oxide fuel cell the data centers sector is primarily driven by growing demand of reliable, and high efficiency power. Owing to the emerging need to decrease carbon emissions, various manufacturers are continuously investing in the solid oxide fuel cell market. Whereas commerical end-users accounts for largest share for the solid oxide fuel cell market. Solid oxide fuel cells are ideal for stationary building applications due to their high electrical efficiency, minimal emissions, and fuel versatility. They can convert a greater proportion of a fossil fuel's energy into electricity than combustion-based processes. They can also generate electricity using low- and zero-carbon fuels like hydrogen. As the need to minimize carbon emissions grows in the business sector, many firms are investing in the SOFC industry.

"Asia Pacific": The largest in the solid oxide fuel cell market"

In the solid oxide fuel cell market in 2023 - 2028, Asia Pacific is estimated to hold the largest market share, followed by North America and Europe. Increased urbanization and population have demanded considerable infrastructure development, driving rising electricity demand across the region. According to the Indian Electrical and Electronics Manufacturers' Association (IEEMA), India's energy generation capacity is predicted to expand from 200 GW in 2010 to more than 800 GW by 2032 to meet rising demand for power. As a result, power equipment production will require a massive investment of around USD 300 billion over the next 3-4 years, increasing demand for solid oxide fuel cells.

Asia Pacific countries enounter many energy-related problems, which has forced them to change their energy systems. Primary energy demands are projected to increase by 60% by 2035, due to expanding industry, urbanization and economic growth. Australia and China are looking to increase the role of hydrogen in order to reduce emissions from industrial processes, such as feedstock, ammonia, methanol production and transport. As the development of fuel cell technology improves, the utility sector acknowledges crucial activities, such as microgrid development.

Key Market Players

The solid oxide fuel cell market is dominated by a few major players that have a wide regional presence. The major players in the solid oxide fuel cell market include Bloom Energy (US), AISIN CORPORATION (Japan), KYOCERA Corporation (Japan), MITSUBISHI HEAVY INDUSTRIES, LTD. (Japan), and MIURA CO., LTD. (Japan). Between 2018 and 2023, these companies followed strategies such as contracts, agreements, partnerships, mergers, acquisitions, and expansions to capture a larger share of the solid oxide fuel cell market.

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Scope of the Report

This research report categorizes the solid oxide fuel cell market by type, component, application, end user and region.

On the basis of type:

• Planar
• Tubular

On the basis of component:

• Stack
• Balance of plant

On the basis of application:

• Commercial & Industrial
• Residential
• Military & Defense
• Data Centers

On the basis of region:

• Asia Pacific
• Europe
• North America
• Rest of the World

Recent Developments

• In June 2023, Bloom Energy signed an agreement with Perenco, an independent oil & gas company, to deploy 2.5 megawatts (MW) of Bloom’s solid oxide fuel cell technology in England.
• In February 2023, WEICHAI POWER CO., LTD., a leading company of SOFC systems based in China, launched a stationary power SOFC system using Ceres technology. The newly launched SOFC system passed the EU CE certification.
• In January 2023, Elcogen AS signed an MOU with Korea Shipbuilding and Offshore Engineering (KSOE) and Fraunhofer Institute for Ceramic Technologies and Systems (IKTS) for developing green hydrogen production and emission-free power generation systems. As per the partnership, Elcogen AS will supply its solid oxide fuel cell (SOFC) and solid oxide electrolyzer cell (SOEC) technology.
• In November 2022, Upstart Power, Inc. and ITOCHU Corporation entered a commercial agreement to co-develop, manufacture, market, and sell Upstart’s SOFC products in Japan.
• In July 2022, Aisin Corporation declared to acquire SBT Certification, an organization that sets Science Based Targets (SBTs). SBTs embody greenhouse gas emission-reduction goals that align with the scientifically established target outlined in the Paris Agreement.
• In June 2022, Bloom Energy installed a new 1 MW solid oxide fuel cell plant at the Maranello facilities of Ferrari, a sports car manufacturer. This plant provides 5% of the energy required for Ferrari’s production activities. This contributed to Ferrari’s aim of achieving carbon neutrality by 2030.
• On an agreement made by Mitsubishi Power with gas- und Wärme-Institut Essen e.V. (GWI) in June 2022 for research and development of heat and energy technology, this company acquired the first SOFC in Europe. The SOFC system started in 2021 and began commercial operation in June 2022.
• In May 2022, Bloom Energy planned to invest $150 million to increase its production capacity. By the end of 2023- they expect their fuel cell capacities to exceed one gigawatt (GW).
• Convion forged a partnership with Biomeetan OU, one of the leading producers of agricultural biomethane as well as biofertilizers for delivery of a biogas power generation plant that employs fuel cells on April 2022.
• In November 2021, Chantiers de l'Atlantiqu awarded Bloom Energy a contract to provide the Bloom solid oxide fuel cell platform for auxiliary power on the MSC World Europa cruise. The company will provide 150 kW of solid oxide fuel cells, which will run on liquefied natural gas (LNG). This is an initiative to decarbonize the marine industry.

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