Fuel cells are electrochemical devices that convert hydrogen and oxygen into water, and in the process produce electricity.

Being a clean source utilising hydrogen, this kind of energy is likely to play an important role as an alternative energy source that will replace existing fossil-based fuel to produce electricity. It is believed that the world will eventually move to a hydrogen-based economy.

Since fuel cells seem to be the way of the future, a group of local automotive-related investors has put up Bt100 million to set up a company called Hygen Power to apply this new kind of power source for use in Thailand.

The company's managing director Adirek Sriwatanawongsa said that energy technology was in a transition period, moving from fossil-based fuel to bio-fuel and eventually hydrogen-based fuel.

The company feels that there will be better business opportunities in bringing this new kind of fuel technology to Thailand.

"As fuel cells generate electricity by themselves, they can produce reliable electrical power. We can offer this new fuel technology to those facing problems with electrical instability," Adirek said.

The company began operation four years ago and has worked with Gen Cell, a US-based fuel-cell manufacturer, to license its technology for producing fuel cell units in Thailand.

"Since fuel cells are a new technology, the first four years of our operation have been a period of knowledge and technology transfer as well as local development," he said.

The company has developed its own technology for the so-called Balance of Plant (BOP), the supporting components necessary to operate the fuel processor and fuel-cell integration into a fuel-cell system.

Adirek said the team had also developed a technique to control the flow of hydrogen as well as recycle hydrogen for further use in the system.

The company signed a contract late last year with PTT Plc to implement a fuel-cell unit to generate electricity for use in PTT's research unit. The implementation is expected to be complete in the next two months.

Under the contract, Hygen will first implement a 50-kilowatt fuel cell unit for electricity generation and hopes to upgrade to 250-kilowatts by the end of this year. The company also takes care of all costs of implementation and PTT will have to pay only the charge for the electricity they use.

"PTT is our first reference site so we will work together to evaluate the efficiency of the fuel cell," Adirek said.

He added that after PTT, the company planned to supply fuel-cell technology to industrial parks for supplementary use in the country's electricity system.

"Since many manufacturing plants in industrial parks require stable electricity, fuel-cell technology will be a solution to allow them to continue their production process non-stop," he said.

Using fuel-cell technology in manufacturing plants required an investment of about Bt80 million to Bt100 million for a one-megawatt fuel-cell unit. At this price however, they will no longer have to pay electricity charges, Adirek said.

Normally, industries that require stable electricity for their production processes have to set up their own electrical sub-system to generate electrical power and it costs around Bt80 million for a 500 to 750 kilowatt system.

"The investment costs of the two systems are similar, but if you invest in the existing electrical system you still have to pay electricity charges, while you pay nothing for electricity generated from fuel-cell technology," he said.

Fuel-cell technology offers a new choice for use in continuous production processes such as the plastics industry, while it is also suitable in the telecommunications sector, data centres, hotels, and waste-water treatment - facilities that require a continuous 24-hour base load power.

Even though this technology requires high investment, Adirek believes that fuel cells will be more popular in the next five years, by which time the cost will have come down.