South Carolina needs to build its own fuel cell companies if it wants to capitalize on the infant industry, leaders in the field said Tuesday.

Trying to convince fuel cell companies to relocate is not a viable strategy at this point in the industry’s life, said Sam Logan, chief executive of LoganEnergy.

Logan; Roger Saillant, chief executive of Plug Power; and John Law, cchief executive of start-up Franklin Fuel Cells; participated in a breakfast discussion at FuelCellSouth 2006. The session was moderated by Bob Rose, executive director of the U.S. Fuel Cell Council.

Logan said the fuel cell industry has been around for about 10 years but is still struggling to show profits.

LoganEnergy of Roswell, Ga., specializes in designing, installing, and maintaining fuel cell systems.

Job growth will occur naturally as the industry matures, Logan said. For the moment, the industry is fairly well entrenched, mostly in the Northeast.

“Those states spend a lot to keep them there because they are flagship technology companies,” Logan said. Other states are spending a lot of money to try to get the companies to move, but Logan doesn’t see that happening.

The industry needs to grow, become profitable and mature. Then it will reach out into new areas, he said.

The panelists agreed there are opportunities in South Carolina. The relationship USC has been developing with the fuel cell industry is creating awareness of what’s possible, Plug Power’s Saillant said.

The real opportunities exist in creating partnerships to incubate new companies.

What does Plug Power have in the back room, Saillant said. What piece of business does the company have that it can’t do anything with because it can’t give it the attention it needs, he said.

Plug Power is one of the world’s best-known fuel cell companies.

Companies might not be willing to move their entire operations, Saillant said, but they might move a part of it.

“I think you will attract the manufacturing jobs in the long run, but don’t get mesmerized about moving a whole business at once,” Saillant said.

Some of that growth will come from university spinouts. Franklin Fuel Cells began in a lab at the University of Pennsylvania. The company licensed a patented technology that allows fuel cells to run on many of today’s conventional fuels, as well as hydrogen. The 3-year-old company hopes to become profitable by 2012, Laws said.

USC already has launched three fuel-cell startups. Palmetto Fuel Cell Analysis & Design, Palmetto Fuel Cell Technologies and Denergy all began within the past six months.

The good news is that commercial fuel cell products are “fact and not myth,” Logan said. They are being used for specialized, niche applications.

On the large scale, Saillant said, “the market is not ready yet.”

Much needs to be done, he said, especially to educate the public and government about fuel cells and to win their acceptance.

“We are winning this beach one grain of sand at the time and we need some bulldozers.”