Fuel cells in the data center

Table of Contents

  1. Summary
  2. The technology
  3. Analysis of fuel cell benefits
  4. Market outlook
  5. Key takeaways
  6. About Adam Lesser

1. Summary

For the past five years, data center operators at high profile web players like Google, eBay, Amazon, and Apple have been experimenting with ways to provide cleaner energy for their data centers while locking in power pricing visibility for the long term. There have been many strategies ranging from building solar arrays (Apple) to investing in wind power on the grid (Google) to even going to far off locations like Icleand which has inexpensive and renewable natural geothermal power (Verne Global).

One other technology with sustainability benefits that is now vying for data center business is the hydrogen powered fuel cell. Fuel cells have been tested and implemented in transportation and megawatt scale fuel cell parks for utilities. In both of these applications, the technology faces fossil fuel competitors that have been steadily improving their technologies for over a hundred years and benefit from the deployment of costly infrastructure to support mainstream technologies like gasoline powered cars.

But mission critical infrastructure like data centers could prove to be a promising market for fuel cells due to a confluence of factors and market timing. As data center operators hone in on power options that increase reliability and provide power cost predictability over decades-long time scales, fuel cells have advantages that will allow them to compete. To be sure, the current market remains small for fuel cells in the data center. But the technology’s advantages, combined with price declines in fuel cells and slowly rising retail utility prices for power, make the next few years a potential point of inflection for fuel cells.

Key findings from this report include:

  • The top drivers for data centers considering fuel cells are increased reliability and long term pricing predictability. Both of these advantages allow for risk mitigation at data centers and are built around using the grid as backup and being able to control power costs over the long term.
  • Fuel cell power at the rate of 12-13 cents per kilowatt-hour makes fuel cells competitive in regions like the Northeast and California. For fuel cells to expand the market further, economies of scale will need to bring that cost closer to 10 cents per kilowatt-hour.
  • The increasing focus on energy efficient modular data centers opens the door for fuel cells as a power option due to the fact that fuel cells are ideal for scaling power supply incrementally.


Thumbnail image courtesy: iStock/Thinkstock

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