02:00 Thu 24 Dec 2015
AFC Energy Plc - Quarterly Newsletter
AFC Energy Quarterly Newsletter -
Dear Shareholder,
As 2015 comes to a close, we can be proud of what
When we sat down in
Twelve months ago, AFC had never operated a fuel cell cartridge greater than 25 cells operating at less than full loading. Today, we can proudly say not only have we progressed from 25 cells per cartridge through to 51 and subsequently 101 cells but have also increased the power density and output of the fuel cells and delivered a complete, consented balance of plant where 8 of our cartridges have operated to sell power into the German grid.
We continue to push hard to achieve our ambitious goals and ensure the system we take to market achieves, not only short-term operational success, but also longevity, safety, stability and density of power supply across the life of project. Our programme of work for next year will focus on these points. However, the recent announcements we have made should provide confidence and strong support to our ability to reach these goals.
In particular, on 12 October, we announced the achievement of our penultimate Milestone 10 with the commencement of temporary operation of an entire tier of eight fuel cell cartridges on the KORE system, in Stade,
The eight fuel cell cartridges used in this Milestone 10 trial have since been used to test the second and third tiers of the KORE system in advance of our final Milestone 11 - the achievement of first commercial scale operability of the KORE module, which will utilise AFC's state-of-the-art alkaline fuel cell technology.
Each tier (there are three in total) within the KORE fuel cell system is capable of operating independently of the other so the successful operation of a single tier of eight cartridges is a significant further de-risking of the system and in particular the Balance of Plant.
At present, all 24 cartridges for the KORE system have been relocated to
Moving briefly away from KORE and the POWER-UP programme, 2015 has seen a strong interest in AFC's fuel cell across several of our key target regions, including
We further announced another Heads of Agreement to develop a business plan for the large-scale deployment of AFC's fuel cells across the
As alluded to in our announcement, based on initial estimates from market soundings, this could present an opportunity on its own to deliver a large percentage of AFC's targeted generation capacity over the next few years. The business plan will also explore potential commercial models for the joint venture between the two companies with a long-term strategic view being taken regarding the prospect for a regional power utility.
I've always long considered the
There are a number of additional opportunities currently being explored internationally with prospective "early adopter" partners and with the commencement of operations in
I think we would all agree that this is an exciting time for AFC, with the results of full commissioning expected to be announced prior to the end of
In conjunction with the development of a commercial pipeline of projects, next year will see a stronger emphasis on system / cartridge cost reduction to ensure the technology is capable of operating in a competitive and efficient manner as compared with alternative clean energy technologies. This process will not only look at the supply chain and reuse / recyclability of the fuel cells but also across possible second generation design of fuel cell components to capture improved learnings and areas identified for further engineering optimisation.
Finally, on 17 December, we announced a subscription to raise approximately
It has always been my intention that shareholders such as yourself, should be allowed to accrue value from AFC, which is why we extended the offer for subscription to qualifying shareholders, who will be entitled to subscribe for up to 5,631,551
Also, as stated, the funds raised by the subscription (but not including any funds to be raised under the Shareholder Offer) will provide the Company with working capital at least to complete the pre-commissioning activities in relation to Milestone 11. In addition, the Company expects to continue to receive additional funds during the first part of next year from its
On behalf of myself and everyone at AFC, I wish each of our shareholders and families a very Merry Christmas and relaxing holiday season. I thank you for your continued support and look forward to further progressing AFC's commercialisation into 2016.
Yours sincerely,
Chief Executive Officer
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