The domestic requirement of additional electric power is likely to touch 1.7 trillion kilowatt hour (kWh) in 2020. This is three times the requirement during 1980 to 2000. It will be a significant challenge for any power utility to accommodate such a large incremental load using only its existing transmission and distribution network.

The reluctance of power companies to invest in newer power plants because of lack of returns and the widening gap between the demand and supply of power are expected to motivate the distributed power generation.

"Enhancing or building new power plants could cause power utilities' reserve margins to exceed peak demand," says Frost & Sullivan Research Analyst Viswanathan Krishnan. "This scenario can drive the distributed power generation sector, for which the fuel cell technologies are considered the most appropriate for its various benefits such as high energy conversion efficiency and its potential to offer reliable and quality power."

Nevertheless, the development of these fuel cell technologies has been restrained largely due to high costs, complex designs and fuel problems. The industry is optimistic about resolving these issues with researchers and companies enthusiastically developing innovative solutions for the inherent problems in the application of fuel cells in stationary power.

For fuel cell technology to be effective commercially, technology developers have to devise strategies to reduce the costs of fuel cell systems. In stationary fuel cell systems' stacks, costs are lowered by minimising the use of expensive materials.

While one method is to enhance fuel cell units' cost-competitiveness is to produce them in large volumes, technology developers also need to focus on inventive and economical ways to obtain hydrogen from hydrocarbons or from other sources to increase the use of fuel cell-based systems.

Researchers have already developed a direct fuel cell-based technology that uses potassium lithium carbonate as the electrolyte, operates at 1200 deg C, and provides 250 kilowatt (kW) to 3 megawatt (MW) power. This technology can help generate electricity directly from hydrocarbon fuels such as natural gas and wastewater treatment gas.

This one-step energy conversion process offers significant cost benefits over competing technologies such as phosphoric acid fuel cells (PAFCs) and proton exchange membrane fuel cells (PEMFCs), which use complex reforming techniques.

In another cost-related issue, technology developers will have to ensure the availability of hydrogen-rich natural gas to facilitate distributed generation applications as well as to stabilise prices to drive greater uptake of the technology.

An important factor that is driving the industry further is the growing concern for environment and fossil fuels, which has motivated participants to look for various alternate power generation technologies. Leading research institutions and companies prefer fuel cell-based power generation, as the electrochemical conversion of chemical energy to electricity in a fuel cell is a 'green process'.

"The elegant emission profile - emitting trace sulphur and nitrogen - makes these technologies an ideal choice for stationary power applications," notes Mr Krishnan.