Technology analysis - Bloom Box


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• The Bloom Energy Server (commonly referred to as the Bloom Box) is a solid oxide fuel cell (SOFC)
• Bloom Energy Server technology is based upon stacking small fuel cells which operate in concert
• The technology strives to create an entirely new energy ecosystem that supports the existing energy system

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Technology analysis - Bloom Box

  1. 1. Katz Graduate School of Business – MIS Practicum Bloom Box Technology analysis → Amit Pawar 2011 University of Pittsburgh
  2. 2. Bloom Box technology:Energy has become extremely crucial for success in the current technology era. An innovativebreakthrough that can resolve some of the energy problems is the Bloom Box. • The Bloom Energy Server (commonly referred to as the Bloom Box) is a solid oxide fuel cell (SOFC) • Bloom Energy Server technology is based upon stacking small fuel cells which operate in concert • The technology strives to create an entirely new energy ecosystem that supports the existing energy systemHow the Bloom Box works?
  3. 3. Oxygen is drawn into one side of the unit, and fuel (fossil-fuel, bio-fuel, or even solar power can be used) is fed into the other side The two combine within the cell and produce a chemical reaction that creates energy with no burning, no combustion, and no power lines about 64 stacks of fuel cells can power a small business like a Starbucks franchise The device was originally invented to produce oxygen on Mars but when NASA scrapped the Mars mission, Sridhar reversed his Mars machine, pumping oxygen in, instead of making oxygenCost of installing a Bloom Box: • Blooms boxes cost $700,000 to $800,000, and each provides 100 kilowatts of electricity--enough to power 100 average U.S. homes--with roughly the footprint of a parking space.How the technology can be used in the IT sector? • The companys pilot customers are using the cells, essentially, as backup generators. • Some new customers like AT&T are using Bloom Box technology to incorporate alternative and renewable energy sources into their sustainable energy portfolio • There are two strategic options for Bloom Box deployment – Equipment Purchase: Customers who want to maximize their return on investment can purchase and install Bloom Energy Servers at their facilities and capture all of the economic benefits of producing their own power for significantly less than the price of electricity purchased from the grid. – Bloom Electrons℠ Service: The Bloom Electrons service is designed to let customers purchase only the electricity they consume. Customers can experience the benefits of clean, reliable affordable energy on their own terms without any upfront costs.The IT sector will be early adopter but other industries are likely to be followers with respect toapplying this technology.
  4. 4. Benefits of using the Bloom Box at Facebook Inc.: 1) It uses lower cost materials 2) Provides unmatched efficiency in converting fuel to electricity 3) Ability to run on a wide range of renewable or traditional fuels 4) Easily to install and maintain 5) It is very compact 6) Its cheaper than the grid and its cleaner than the gridStrategic and Operational Impact: • Reducing the electricity cost • Establishing a green footprint: eBays boxes run on bio-gas made from landfill waste, so theyre carbon neutral.Risks: 1. The technology is still in the inception stage 2. Production rate is 1 box per day could lead to a very long lead time 3. Most analysts predict that electricity from Bloom boxes will require subsidies to meet and beat the rates provided by the grid. 4. The pilot boxes, sold to the likes of eBay and Google, come in at $700,000 to $800,000, which is 20 times the fuel cell price targets set by U.S. research labs to achieve widespread adoptionCompetition: • GE has dismantled its fuel cell group five years ago • Siemens has almost dismantled their fuel cell group • United Technologies is the only large conglomerate that has fuel cell technology that could compete with Bloom Energy • Ceres Power in the UK and Ceramic Fuel Cells in Australia/Germany, have products close to market launch • Toshiba only has technology to provide energy for a small device, not a neighborhood.Early adopters: • Early customers include Google, eBay, Coca Cola, FedEx, and Staples – John Donahoe, eBays CEO, says its five boxes were installed over a year ago and have already saved the company $200,000 in electricity costs • Four units have been powering a Google data center for two years. They use natural gas, but half as much as would be required for a traditional power plant. • Wal-Mart Stores is a repeat customer • Bloom Energy installations will be deployed at 11 AT&T facilities in California
  5. 5. Steps Facebook Inc. can take with respect to the Bloom Box technology:Even though this technology is in the embryonic stage, it would be beneficial for Facebook toevaluate the energy needs. The major benefit can be cost saving in electricity consumption byusing this technology. It will also help Facebook to achieve its corporate sustainability goals.Facebook Inc. should use its influence to directly contact Bloom Energy and evaluate thebenefits of adapting the technology for powering its servers.Sources of additional information: 1) Bloom Energy 1252 Orleans Drive Sunnyvale, California 94089 • Telephone:(408)-543-1500 Fax: (408) 543-1501 • Web: 2) White paper: Understanding CO2 Emissions Accounting