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Bloom Energy to sell 10-year electricity contracts

Bloom Energy’s
‘Bloom Box’ “’ enough
energy for about
100 homes
San Francisco, United States — ESI-AFRICA.COM — 21 January 2011 – In a unique departure from its current operations, Silicon Valley fuel cell-maker Bloom Energy is planning to launch a new sales initiative to sell 10-year electricity contracts, in addition to straight-out sales of its machines.

Revealing this in a company statement issued here, it said that Credit Suisse would provide financing for the service by Bloom, one of the best-known new American companies focusing on alternative energy and clean technology. Its machines used electrochemical chemical processes to turn natural gas and biogas into energy.

Chief financial officer Bill Kurtz said that the new offering would essentially double demand, since many customers preferred to avoid the capital costs of buying machines, and that Bloom’s profit margins were equal for both transactions. He declined to comment on Bloom profitability.

A Bloom box produces enough energy for about 100 homes or a small office. The company is making about one machine per day, and plans to double that rate over the next year. It has enough capital to carry out the 2011 business plan, Kurtz added.

Customers under the lease-style programme, called Bloom Electron, get a 5% to 20% break on electricity prices, compared with a 20% savings over the 10-year lifetime of a purchased machine, he said.