Hartford Business Journal

www.CTGreenGuide.com SPRING 2016 • CONNECTICUT GREEN GUIDE 7 By Matt Pilon A fter a series of recent Connecticut deals, Danbury's FuelCell Energy is flirting with a future no longer laden with steady red ink. The publicly traded manufacturer, which hasn't made a profit since before it began selling commercial power plants in 2003, now has enough projects in its pipeline to nearly triple its fuel cell installations in Con- necticut, to approximately 100 megawatts. That will be a milestone, but it doesn't mean profits are going to come this year. However, losses are the lowest they've been in years, and CEO Arthur "Chip" Bottone insists FuelCell is headed in the right direction. The pending construction here includes a 63-megawatt fuel cell park in Beacon Falls and a six-megawatt plant at Pfizer's Groton campus. Connecticut remains one of the company's strongest markets, due to its inclusion of fuel cells in the mix of clean technology utilities here are required to buy each year. Connecticut's dense popula- tion and high electricity costs also make fuel cells a better value proposition here than in the Midwest and other areas, because they are compact, quiet and can produce a lot of energy per square foot. With the help of taxpayer money, FuelCell is ramp- ing up capacity at its Torrington manufacturing plant to serve the growing backlog and future business. The state agreed in 2014 to provide two low-interest $10 million loans and up to $10 million in tax credits. That's helping fund a 102,000-square-foot expansion of the company's Torrington 65,000-square-foot manufactur- ing facility and the related hiring of up to 325 new posi- tions, which could bring its total to 863 in the state. Construction should be in full swing this spring. As of Oct. 31, 2015, the company had grown to 552 workers in Connecticut and 596 worldwide. If it meets hiring pledges over the next four years, the state will forgive $10 million of the loans. "We're here. We're a Connecticut company. I don't take that lightly," Bottone said during a February interview in Hartford. The Torrington expansion will double the number of fuel cells the company can produce a year, to 200 megawatts. From there, getting to profits is mainly a matter of more companies and utilities adopting fuel cell technol- ogy. If Torrington can get enough orders to produce half of that amount in a single year, the company would be in the black, Bottone has said. Torrington's annual "run rate" last year was 70 megawatts. The Beacon Falls park, which is competing in a state bidding process for a utility power purchase agreement, would be a key step forward, said Jeffrey Osborne, an energy analyst with Cowen & Co. "A big, chunky project like Beacon Falls would help," Osborne said. It won't just be about getting enough order to fill the roughly 20 megawatt gap between losses and breakeven, Osborne said. FuelCell has been shipping approximately 30 megawatts of its Torrington-produced technology to South Korean partner and investor POSCO, which will soon launch its own manufacturing facility to produce FuelCell plants entirely on its own. FuelCell gets a royalty from every POSCO sale, but it's a lower margin that it gets from selling its Connecticut- made plants. The Asian plant provides assurances

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