DANBURY, CONN.—FuelCell Energy, Inc., a leading manufacturer of ultra-clean electric power generation plants for commercial and industrial customers, announced that the federal government’s recent extension of the Income Tax Credit (ITC) for fuel cells will continue to provide additional incentives for its ultra-clean power plant products through the end of 2008.
Enacted as part of the U.S. Energy Policy Act of 2005, the ITC established a range of incentives for “green” electricity produced by non-traditional means. The company’s low-emission fuel cell power plants qualify because they run on renewable fuels (such as gas produced by breweries and other anaerobic digester processes) and other readily available fuel sources (like natural gas).
The ITC, originally due to expire at the end of 2007, has been extended to Dec. 31, 2008. The ITC helps end users produce clean energy by subsidizing the purchase of fuel cell power plants up to $1,000 per kilowatt of electricity generated, to a maximum of 30 percent of the net investment cost. It also allows plant owners to depreciate the equipment over five years. By enhancing project economics, these incentives also enable project financing of fuel cell transactions.
ITC Benefits FuelCell Energy Customers
“The tax credit’s availability for an additional year clearly demonstrates the federal government’s ongoing commitment to advancing ultra-clean fuel cell products,” says Bruce Ludemann, Senior Vice President of Sales and Marketing for FuelCell Energy. “The program helped many of our private-sector customers purchase our DFC products in calendar 2006 and now it will continue to benefit new customers in the upcoming two years.”
Recently, new legislation was introduced in the U.S. House of Representatives, HR 550, to extend the ITC through 2016 and a similar bill is expected to be presented in the Senate shortly.
“We strongly support the further extension and possible enhancement of the ITC credit for fuel cells,” Ludemann says. “Not only does the credit help our business, but it also helps relieve our country’s dependence on foreign oil while giving us all cleaner air.”
The company’s Direct FuelCell (DFC) power plants provide the highest electrical efficiency—up to 47 percent—of any baseload, 24/7 power-generating source in their size range. Because they don’t burn fuel but instead convert it electrochemically into hydrogen, water and electricity, they also have an ultra-clean emissions profile. When the thermal output is combined with the power generated for “combined heat and power” applications, DFC power plants can achieve even higher overall energy efficiencies of 70 to 80 percent.
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