Europe Solid Oxide Fuel Cell for CHP Application Market Size, Share & COVID-19 Impact Analysis, By Application (Residential, Commercial, and Industrial) and Regional Forecast, 2022-2029

The Europe solid oxide fuel cell for CHP application market size was valued at USD 8.2 million in 2021. The market is projected to grow from USD 9.3 million in 2022 to USD 27.2 million by 2029, exhibiting a CAGR of 16.5% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with solid oxide fuel cell for CHP application experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the market exhibited an increase of 59.5% in 2020 compared to 2019.

Solid Oxide Fuel Cell (SOFC) can be defined as a device that generates energy from oxidizing a fuel through electrochemical conversion. Fuel cells are categorized through their electrolyte material. SOFCs use a solid oxide electrolyte to conduct negative oxygen ions from the cathode to the anode. These fuel cells possess high CHP efficiency, higher stability, lower emission, and fuel flexibility. SOFCs are relatively cost-efficient. These devices generally operate at higher temperatures and do not require expensive platinum catalyst materials like others.  

COVID-19 IMPACT

Halt on Production Activities Temporarily Impacted the Installation of these Devices

The outbreak of the COVID-19 pandemic has impacted various developing and developed countries, including Germany, France, Italy, and many others, and has observed a significant rise in the total number of cases over the period. The solid oxide fuel cell market for CHP application has also been moderately affected by this unprecedented situation, as various countries have experienced a considerable loss in the total workforce in various sectors. The unavailability of a skilled workforce coupled with long-spanning shutdowns of European manufacturing plants has resulted in a limited output of fuel cell systems hindering the planned installation of such systems and further hampering the industry growth.

In June 2020, the International Energy Agency (IEA) stated that fuel cells used observed a significant boost before the COVID-19 crisis in 2019 and early 2020. Similarly, fuel cells used for applications such as portable and stationary have also been boosted. However, the growth can be higher without the COVID-19 situation, as shown in the figure.

LATEST TRENDS

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Rising Government Projects and Funding to Create Lucrative Opportunities for the Market

The European Union (EU) is going through a transition from conventional sources to renewable sources. The government also implemented several policies to boost renewable adoption and installation, including hydrogen-based fuel cells. SOFC are important enabling technologies for the EU’s long-term goals related to emissions. For instance, the EU has funded the New SOC project. The project aims to raise the market penetration of this technology and the ecological impact of solid oxide fuel cells and stacks by enhancing their performance, durability, and price competitiveness.

Europe is extensively installing fuel cell units for combined heat and power applications due to three main projects and actions, Callux, PACE, and ene.field. The three programs have significantly contributed to the growth of fuel cell-based CHP.

DRIVING FACTORS

Rising Demand for Clean Sources of Energy to Reduce Carbon Emissions to Boost Market Growth

Solid oxide fuel cells are a power source for several applications, including stationary and mobile. It provides a clean, reliable, and more energy-efficient solution to the rapidly rising power demand. Therefore, better fuel efficiency and inclination toward adopting zero-emission equipment will surge the demand for solid oxide fuel cell for CHP application during the forecast period. People are becoming aware of the harmful effects of carbon emissions on the environment, which has increased the demand for clean sources among consumers. CHP systems are widely adopted owing to increasing demand for continuous power supply and space heating requirements across Europe. The technology also helps European countries to achieve their zero-emission target by 2030.

Increasing Demand for Reducing Dependency on Conventional Fuels for Power Generation Augments Growth in the Market

Burning fossil fuels releases greenhouse gases and harmful content leading to many problems such as ocean acidification, global warming, and other severe issues. Hence, governments and other private organizations across the EU have increased the focus on diminishing carbon footprint and curbing other harmful emissions.

Solid oxide fuel cell operates on abundantly available hydrogen as the primary fuel, thereby reducing the economic dependence on fossil fuel usage. Additionally, it does not generate hazardous emissions such asCO, CO2, SOx, NOx, and other contents emitted by conventional fuels, boosting the adoption of fuel cells on a large scale. The European private-public collaborative R&D initiative named Fuel Cells and Hydrogen Joint Undertaking (FCH JU) has projected that by 2050, hydrogen fuel would hold around 24% of entire regional energy consumption.

RESTRAINING FACTORS

 Dominance of Other Fuel Cell Technologies to Hinder Market Growth

The availability of other fuel cell options, which also hold certain advantages, can hamper the growth of solid oxide fuel cell devices. For instance, the Proton-Exchange Membrane Fuel Cell (PEMFC) is preferred for stationary and portable applications as it has the advantage of operating at low temperatures, eliminating electrode corrosion as there is no liquid electrolyte, high efficiency, and quick start-up times.

The demand for such fuel cells is high for CHP owing to its various benefits, including efficiency, cost-efficiency, energy security, and widespread availability, thereby increasing the adoption of PEMFC in the market. The increased costs of initial manufacturing and significant operational expenditure to run solid oxide fuel cell systems with the required fuel may hamper the market growth.

SEGMENTATION

By Application Analysis

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Residential Segment to Dominate the Market Due to Rising Adoption of CHP Systems

Based on application, the market is segmented into residential, industrial, and commercial. The residential segment dominates the Europe solid oxide fuel cell for CHP application market owing to wide adoption of fuel cell-based CHPs for residential applications for space heating, water heating, and various other purposes.

Europe Union’s efforts for the past five years have been focused on smaller-scale fuel cell systems, including domestic CHP in thousands, and more recently on smaller commercial units in the single and tens of kW power output. With completion due in 2022, Pathway to a Competitive European Fuel Cell micro-Cogeneration market (PACE) has a budget of USD 107 million. The objective was to drive costs by supporting the deployment of 2,800 systems, enabling the switch from single-system building to series production.

The commercial segment is another lucrative application for SOFC-based CHPs across Europe. The demand for commercial CHP systems is increasing due to rising awareness of an emission-free environment and hydrogen penetration among the population.

COUNTRY INSIGHTS

Geographically, the Europe solid oxide fuel cell for CHP application market has been analyzed across six main countries, Germany, the U.K., France, Italy, Spain, Russia, and the rest of Europe.

Germany accounts for a major market share in Europe. The demand and adoption of such systems are highly boosted due to various projects such as PACE, KfW 433, and others. The country provides national subsidies adding to PACE incentives. As most of Europe’s fuel cell developers are either based in or have a presence in Germany, KfW 433 has become important for fuel cell-based micro-CHPs.

The U.K. is another lucrative market for the installation of solid oxide fuel cell for CHP application. The adoption of such systems is increasing rapidly across the country as the focus on hydrogen is increasing. Recently, Bosch has also agreed with the U.K.-based Ceres to use its SteelCell SOFC technology for commercial-scale end uses. Growing concerns and the government’s initiatives to boost hydrogen drive growth in the SOFC for the CHP application market.

France is another significantly growing area for solid oxide fuel cell for CHP application market. The demand and installation of fuel cells are boosting in this country amid the carbon-neutral targets. The commercial and industrial sectors highly adopt solid oxide fuel cell for CHP application due to their fuel flexibility. The above factors drive growth in the solid oxide fuel cell for CHP application market in France.

Italy, Russia, and Spain are other growing markets and are likely to witness significant growth during the forecast period. These countries are installing such devices owing to their benefits and also to reduce the use of fossil fuels as these systems are compatible with hydrogen as fuel.

KEY INDUSTRY PLAYERS

Key Market Players Focus on Technology Advancement to Strengthen their Market Position

Various players operate in local, regional, and international footholds across the market. To enhance their regional position, different companies emphasize producing products with even higher efficiency, high stability, and fuel flexibility. Additionally, numerous participants are also manufacturing solid oxide fuel cell for CHP application at the local level. Ceres Power, Doosan Fuel Cell, and Fuel Cell Energy are the leading players in the European region and offer technologically advanced products for solid oxide fuel cell for CHP application. These players are highly expanding their customer base within the European region and increasing their production efficiency to stand out.

LIST OF KEY COMPANIES PROFILED:

• Ballard Power Systems (Canada)


• Nedstack Fuel Cell Technology (Netherlands)


• Bloom Energy (U.S.)


• Doosan Fuel Cell Americ Inc. (U.S.)


• Hydrogenics (Canada)


• Ceres Power (U.K.)


• Plug Power (U.S.)


• Nuvera Fuel Cells, LLC (U.S.)


• FuelCell Energy (U.S.)


• SFS Energy AG (Germany)

KEY INDUSTRY DEVELOPMENTS:

•  June 2022: Doosan Fuel Cell Co., Ltd. announced an association with KOSPO (Korea Southern Power), Samsung C&T, and KIER (Korea Institute of Energy Research). These companies have signed an MOU, including cooperation on projects on ammonia development and fuel cell-related CCU technology.


•  April 2022: SFC Energy AG signed the "Make in India" agreement with its partner FC TecNrgy Pvt Ltd. The agreement is to set up manufacturing in India of all components of its EFOY Methanol fuel cells, hydrogen, and energy solutions.


•  February 2022: Ceres Power Holdings Plc announced an association between Robert Bosch GmbH and China’s Weichai Power for developing and producing solid oxide fuel cells for the Chinese market. This is a three-way collaboration between these companies.


•  July 2021: Bloom Energy announced a 4.2 MW Combined Heat and Power (CHP) project in collaboration with SK Ecoplant. This project is said to be the first-ever utility-scale SOFC CHP initiative in South Korea. The construction is expected to begin later this year.


•  May 2021: Bloom Energy collaborated with Baker Hughes to develop efficient power and hydrogen solutions to accelerate the energy transaction. The agreement focuses on potential commercialization and deployment of integrated, low-carbon power generation, and hydrogen solution, which led to the advancement of energy transaction with hydrogen solution.

REPORT COVERAGE

An Infographic Representation of Europe Solid Oxide Fuel Cell for CHP Application Market

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The Europe solid oxide fuel cell for CHP application market research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, types, and leading applications of the system. Besides this, the report offers insights into market trends and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several factors that have contributed to the Europe solid oxide fuel cell for CHP application market growth in recent years.

Report Scope & Segmentation