SOLID OXIDE FUEL CELL MARKET ANALYSIS

The global solid oxide fuel cell market size was valued at USD 635.4 million in 2022 and is anticipated to witness a compound annual growth rate (CAGR) of 22.21% from 2023 to 2030. Increasing awareness about alternative sources of energy is one of the major factors driving the solid oxide fuel cell market size. The market is projected to experience a considerable increase in demand for clean electricity and power generation in the coming years. Moreover, the increasing use of solar power is expected to contribute to the market growth during the forecast period.

Global Solid Oxide Fuel Cell Market: Regional Insights

The global solid oxide fuel cell market is geographically segmented into North America, Latin America, Europe, Asia Pacific, and Middle East & Africa.  

Among regions, North America is projected to show strong growth in the global solid oxide fuel cell market. This can be attributed to early adoption of the commercial-scale deployment of fuel cells, government funding, and focus on reducing use of oil and emissions from the transportation sector leading to growing demand for SOFC-based fuel cells. Moreover, growing focus on improving hydrogen fueling infrastructure in the region is also likely to drive deployment of hydrogen fuel cell vehicles, which in turn is expected to support growth of the global solid oxide fuel cell market in the region over the forecast period.

Furthermore, Asia Pacific is also anticipated to show substantial growth in the global solid oxide fuel cell market over the forecast period. The region is likely to be one of the promising regional markets for SOFC due to favorable government policies in nations such as Japan, China, and South Korea that are fueling use of clean energy. The use of clean energy technology is increasing in China to turn into a low-carbon economy. Thus, the aforementioned factors are anticipated to fuel growth of the market in this region.

Figure 1: Global Solid Oxide Fuel Cell Market Share (%), By Region, 2022

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Global Solid Oxide Fuel Cell Market Drivers:

Rise in research and development activities for SOFC based technologies to fuel the market pace

Solid oxide fuel cell technology is a promising technology, however, the initial investment and emphasis on R&D activities of this technology are crucial for feasible commercialization. In recent years, expenditure on R&D activities for development and feasibility enhancement of fuel cell has increased considerably due to various targets by governments globally for the reduction of greenhouse gas emissions and pressure on corporate world for reducing the carbon footprint. Several developed countries are increasingly investing major amounts in research and development of SOFC. Thus, this in turn is expected to fuel growth of the global solid oxide fuel cell market over the forecast period.

Increase in demand for energy-efficient power generation to drive the market growth

Solid state fuel cells have an important role in the decentralization of energy, as they produce clean, quiet, and efficient energy in especially stationary power generation. Soli oxide fuel cells are considered to be the most efficient type of fuel cells having efficiencies of electricity conversion. When the waste heat generated by SOFC is harnessed, the overall fuel efficiency of SOFC reaches to over 90%. This can happen with using the waste heat in central heating systems, as similar to all fuel cells, SOFCs generate energy from hydrogen, which is a carrier of energy. Thus, increase in demand for energy-efficient power generation will drive the demand for SOFCs, which is expected to augment growth of the global solid oxide fuel cell market over the forecast period.

Global Solid Oxide Fuel Cell Market Opportunities:

Growing deployment of Distributed Generation (DG) SOFC systems is expected to offer multiple business opportunities in the global solid oxide fuel cell market over the forecast period. The Solid Oxide Fuel Cell program conducted by the National Energy Technology Laboratory (NETL) has recognized that a lucrative pathway for deploying utility-scale systems is via the near-term market opportunities in DG. The experience related to operations and manufacturing gained through deploying DG SOFC systems will be beneficial to continue developing bigger systems based on the SOFC technology. This will eventually lead to SOFC-based utility scale central generating station using coal-derived synthesis gas or natural gas. Thus, deployment of DG SOFC systems will offer lucrative opportunities in the global solid oxide fuel cell market over the forecast period.

Growing applications of solid oxide fuel cell is anticipated to create various opportunities in the global solid oxide fuel cell market over the forecast period. The applications of DG solid oxide fuel cell are paving the way towards utility-scale systems with carbon capture, as they validate and enable the underlying technology through effective utilization of R&D investment by government. Moreover, several governments across the globe are promoting research and development of SOFC applications, which is also expected to create lucrative environment for growth opportunities in the market.

Global Solid Oxide Fuel Cell Market Trends:

Market players focusing on expansion of production capacity is a recent trend in the market

Several manufacturers in the global solid oxide fuel cell market are focused on expanding their production capacities of fuel cells. For instance, in December 2020, Bosch, a German technology company announced that it is ramping up the stationary fuel cells and is starting full-scale production of distributed power stations based of SOFC technology, by 2024. The company targets an annual production capacity of SOFC system of some 200 MW for supporting nearly 400,000 people with electricity in their homes. This trend is likely to continue in the global solid oxide fuel cell market over the forecast period.

CHP systems gaining popularity is a growing trend

SOFC are suitable best for stationary power generation systems for businesses and homes. However, due to their high-temperature efficiency, they are distinguished from other fuel cells utilized for such applications, which makes them best suited for combined heat and power systems or cogeneration systems. There was a constant increase in adoption micro-CHP systems in Europe and the U.S., which further decreased emissions of carbon-dioxide significantly. Thus, growing popularity of CHP systems is expected to drive growth of the global solid oxide fuel cell market over the forecast period.

Global Solid Oxide Fuel Cell Market Restraints:

Growing adoption of LIB technology to limit the market growth

The cost of lithium-ion batteries (LIB) has reduced significantly in recent years and it continues to decrease, which is among various factors that are influencing the rapidly increasing adoption of LIB technology among various sectors such as energy storage and renewable automobiles. This is however is impacting use of solid oxide fuel cell-based technology across several sectors, which in turn is expected to hinder growth of the global solid oxide fuel cell market over the forecast period. However, growing technological advancement in SOFC technology is likely to drive the adoption of this solid oxide fuel cells, which is likely to support the market growth.

High cost of SOFC to impede market pace

Solid oxide fuel cells are known to be a complex integration of various chemical elements for electro-catalytic oxidation of LP gas, methane, and other natural gas-based fuels for generating electricity. As the main chemical process is an exothermic reaction, solid oxide fuel cells operate usually at significantly high temperatures that range from 700°C to 1,200°C. However, traditional ceramic electrolytes lack the efficiency of operating at these temperatures due to which, yttria stabilized zirconia (YSZ) is used as an electrolyte. This further significantly increases the capital cost needed for SOFC, which in turn hinders growth of the market.

Figure 2: Global Solid Oxide Fuel Cell Market Share (%), By End User, 2022

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Global Solid Oxide Fuel Cell Market Segmentation:

The global solid oxide fuel cell market report is segmented into End-User and Region

Based on End-User, the market is segmented into Vehicular Applications and Non-Vehicular Applications. Out of which, Vehicular Applications is expected to dominate the global market over the forecast period and this is attributed to the various benefits of SOFCM in vehicular application. Solid oxide fuel cells are being used in large vehicles as well as in battery electric vehicles to extend range. Due to their various advantages, the demand for SOFC is increasing in vehicular applications. This is expected to drive growth of the market.

Non-Vehicular segment is also expected to witness significant growth in the near future and this is owing to the benefits such as high electrical efficiency, high-quality heat supply, flexibility of use, small installation footprints, and use of cheap materials, when used in CHP applications.

Global Solid Oxide Fuel Cell Market: Key Developments

In August 2019, Bloom Energy Corporation introduced a novel AlwaysON Microgrid Solution for providing customers with energy resiliency to face outages.

In September 2019, Sunfire GMBH entered into partnership with Ensol Systems, a leading manufacturer and supplier of off-grid power solution based in Canada, for integrating, distribution, and service of Sunfire fuel cells in North America.

In December 2020, Ceres Power Holdings plc. announced its collaboration with Robert Bosch GmbH to scale up the mass production of solid oxide fuel cell systems, with a 200MW initial capacity by 2024.

In March 2021, Elcogen AS and Mainor Ulemiste partnered for the development of a 50 MW solid oxide fuel cells and stack production facility in Tallinn with an investment of US$ 6.3 million.

Global Solid Oxide Fuel Cell Market: Key Companies Insights

The global solid oxide fuel cell market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis.

Some of the key players in the global solid oxide fuel cell market are H2E Power Systems Inc., Mitsubishi Power, Ltd., CONVION Ltd., Watt Fuel Cell Corporation, Elcogen AS, Bloom Energy Corporation, Ceres Power Holdings plc., and Sunfire GmbH

*Definition:

Solid Oxide Fuel Cell (SOFC) Power Systems generate electricity by chemically reacting hydrogen with oxygen to produce water and a high-energy electrical current. They can be used in homes and cars, but require purified fuels, and platinum electrode catalysts.