LEHIGH VALLEY, Pa., March 14, 2012 /PRNewswire/ -- Air Products (NYSE: APD) and FuelCell Energy, Inc. (NASDAQ: FCEL) a leading manufacturer of ultra-clean, efficient and reliable fuel cell power plants, today announced the signing of a Memorandum of Understanding to work toward the market development of stationary Direct FuelCell® (DFC®) power plants that simultaneously produce hydrogen, ultra-clean electricity and usable high quality heat. Target markets for these tri-generation stationary fuel cell power plants include industrial hydrogen users as well as vehicle fueling applications. "On-site or distributed co-production of hydrogen in a cost effective and efficient manner from stationary fuel cell power plants represents tremendous market potential," said Ed Kiczek, global director – Hydrogen Energy Systems at Air Products. "Hydrogen is an alternative fuel that can simultaneously reduce a country's dependence on imported oil and significantly reduce greenhouse gas emissions." The initiative seeks to develop a market for tri-generation megawatt-class power plants around the world. Industrial users of hydrogen can utilize all three of the DFC revenue streams including hydrogen, electricity and heat. On-site or local production of hydrogen and electricity eliminates the delivery costs incurred by industrial companies while enhancing security and reliability of supply. "By combining our industry-leading fuel cell technology and expertise with the market reach, hydrogen processing, and distribution capabilities of Air Products, together we can create the hydrogen infrastructure with a solution that is ready today," said Chip Bottone, president and chief executive officer, FuelCell Energy, Inc. "Our stationary fuel cell power plants are quite versatile and this initiative represents what we expect to be an efficient and cost effective manner of providing on-site hydrogen production in an environmentally friendly manner." Distributed generation of hydrogen could help to enable hydrogen infrastructure development by producing hydrogen in locations convenient for end-uses such as vehicle fueling or industrial use. Fueling operations or neighboring facilities can utilize the ultra-clean electricity and high quality heat produced. Using DFC power plants to generate hydrogen near the point of use supports domestic jobs while promoting energy independence as DFC plants are designed and manufactured in the United States and utilize abundant natural gas as a fuel source. Air Products and FuelCell Energy are already working together on a three year hydrogen production project in California, which began in 2011. Under subcontract to Air Products, FuelCell Energy is operating a DFC power plant at an Orange County Sanitation District wastewater treatment facility near Los Angeles. The project, funded in part by the United States Department of Energy, California Air Resources Board, South Coast Air Quality Management District, and also involving the National Fuel Cell Research Center at the University of California, Irvine, is providing renewable hydrogen for vehicle fueling along with ultra-clean electricity. The power plant efficiently converts biogas generated from the wastewater treatment process into renewable hydrogen for a nearby vehicle fueling station operated by Air Products, as well as ultra-clean electricity used by the wastewater treatment facility. FuelCell Energy manufactures stationary fuel cell power plants that provide continuous baseload power in a highly efficient and environmentally friendly process. DFC power plants are fuel flexible, using readily available fuel sources such as natural gas or renewable biogas. These fuels are converted to hydrogen by the fuel cell process. The electro-chemical power generation process does not utilize all of the hydrogen generated by the fuel cells so the excess hydrogen can be used to meet other demands such as vehicle fueling or industrial purposes. Due to the absence of combustion in the fuel cell power generation process, virtually no pollutants are emitted such as nitrogen oxides (NOx), sulfur oxides (SOx), or particulate matter, resulting in ultra-clean power generation.