- Ceres Power’s fuel cell technology is unique because it can use multiple fuels.
- Fuel cells can use hydrogen and natural gas to generate electricity.
- The company’s technology has broad applicability in the power generation industry.
People familiar with Ceres Power Holdings plc (LON: CWR) know that the company develops advanced fuel cell technologies and licenses them to other companies that manufacture the physical fuel cells.
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I’ve mentioned in the past that this asset-light business model is crucial to Ceres Power’s future success because it doesn’t have the significant operating costs associated with manufacturing fuel cells using its technologies.
Focusing on its fuel cell technology, we find that Ceres Power’s fuel cells can be powered by natural gas and hydrogen. This cool feature allows its fuel cells to use both types of fuels.
Therefore, users can install the fuel cells and start using natural gas until hydrogen energy becomes readily available. Then they can switch to using hydrogen gas, which emits zero carbon emissions because the only byproduct of using hydrogen is water.
SteelCell from Ceres Power® The technology uses readily available materials such as steel and ceramics to make fuel cells, making it cheaper for companies to manufacture fuel cells based on its technology.
However, many have argued that Ceres Power’s fuel cell technology is outdated, so the company is investing heavily in developing new technologies for new hydrogen fuel cells which could see it attract more customers.
Since Ceres Power was launched in May 2001, the company has been around for over 20 years and has a vast repository of actionable data and insights to build upon. However, his legacy is a double-edged sword as it may be the only thing holding him back in the future.
Investors are acutely aware of how traditional companies have struggled to adapt to changing market conditions and technologies. The stock market is full of companies like Walmart that have failed to recognize the threat posed by Amazon.com and Internet commerce.
The technology around sustainable energy sources is changing rapidly, and traditional businesses need to keep pace with new entrants that don’t have the burden of entrenched routines that could hinder the adoption of new technologies.
Yet Ceres Power’s solid oxide fuel cell (SOFC) is widely used in the power generation industry, which explains its partnership with South Korean company Doosan to use its fuel cells for power generation. of electricity.
The company has also partnered with German engineering firm Bosch to further develop its fuel cell technology. Additionally, a Chinese company known as Weichai is testing Ceres Power’s technology in buses.
There’s also the matter of Ceres Power’s valuation at £1.43 billion, which is quite expensive. The company’s revenue in 2021 was £31.7m, with the company expecting its revenue to reach £72m by 2025.
Ceres Power stock price.
Ceres Power shares are trading sideways in a range in place since early March. A break above the 823p resistance level would indicate further gains, while a break below the 697.6p support level would indicate future losses.