We gave portable consumer fuel cell developer MTI Micro a bit of a hard time in a post this week about how long the technology was taking to get to market — it’s slated for commercialization in 2009. MTI’s CEO Peng Lim and VP of Corporate Development George Relan sat down with us this week to chat about the get-to-market process, their methanol fuel cell technology, their relationship with battery king Duracell, and how much a fuel cell refill might actually cost a consumer (less than a cup of coffee).
They also showed off a working prototype of a universal fuel cell power source running a battery-less digital camera. (It’s the smallest of the three units in the picture.) Here’s excerpts from our conversation:
On MTI Micro’s Core Technology:
CEO Peng Lim (PL): We’ve been working very hard over the last 18 months to bring this product to manufacturing readiness. We suspect that our technology is ahead. We have filed 86 patents and 32 of them have been granted. We’ve also filed 23 international patents.
Our technology uses 100% percent methanol. Our competitors, in the public domain, all dilute methanol with water. When you dilute the methanol, its energy level, the stamina of the chip, decreases.
The operable temperature range is zero degrees Celsius to 40 degrees Celsius and it runs at any humidity level. This is very important because until it can operate in the whole range, it can’t be put into consumer products for commercialization. None of our competitors have publicly said they can operate at any humidity level.
On the Commercialization Model:
PL: It’s very important for our business strategy that we work with other companies. At the end of the day, we produce a component that goes into a system like an MP3 player. So our strategy is working with branded consumer electronics companies. In May 06, we came to an alliance agreement with Samsung Electronics to work with them on prototypes for the mobile phone market. And we’ll sign another OEM soon.
Some of our competitors might try to go to the market on their own and try to open the channel. It’s not as straightforward as people thought it would be.
On Peng Lim as MTI Micro’s CEO:
VP of Corporate Development George Relan (GR): I’ve been at MTI Micro since its inception… In the last 18 months, what Peng has brought is a mindset geared towards manufacturing. Product, product, product. Stop thinking technology, who cares. I’m paraphrasing but that’s the idea.
In the last nine months, we’ve reduced the sizes of the prototypes and made it more commercial-looking. Over the next 18 months, I feel we have all the pieces in place to make it work. We’re going to be doing only manufacturing readiness.
On MTI Micro’s Relationship with Gillette/Duracell:
PL: To be successful in consumer electronics, distribution is key. That’s why we have Gillette/Duracell as a distribution partner. And there is nobody bigger in the distribution than Gilette/Duracell in batteries themselves.
GR: They gave us an initial amount of money and then we had a number of milestones on which we worked together We have patents on cartridges together. There will be some royalty associated with the cartridge.
PL: So we will share profit.
On the Consumer Price Point for Fuel Cell Refills:
PL: We don’t disclose it because we work with OEMs out there. What we disclose is that the raw material is very cheap. We do say that it won’t be so expensive that it will shock you. It will be cheaper than a cup of coffee. It will be cheaper than a bottle of water.
On the Importance of the Department of Transportation’s Ruling on Methanol Fuel Cells:
GR: [Getting DOT approval] has been a long process. Other fuels, like hydrogen, were not part of the proposed regulation… So the issue is that they have to go through another round of process. It doesn’t mean they won’t get approval, but that gives us an opportunity to get our product out.