Bloom Energy attracts data center operators in Cali

Silicon Valley’s fuel cell maker Bloom Energy continues to add customers looking to power part of their data center operations with distributed, cleaner power in California. On Thursday, the U.S. division of Japanese telecom giant NTT, NTT America, said it will install five Bloom fuel cells at one of its data center facilities in San Jose, Calif.

Nine-year-old Bloom Energy sells an industrial-sized fuel cell (which looks like a large refrigerator) that uses a chemical reaction to produce electricity. The Bloom Boxes suck up oxygen on one side and fuel (usually natural gas or biogas) on the other side, and produce power on-site for companies in a more efficient and less carbon-intensive manner than using the grid (depending on what fuel the company uses).

NTT America says it will use biogas (gas generated by decomposing organic material) produced at a California dairy farm as fuel for the Bloom fuel cells. That means NTT’s fuel cells won’t emit as much carbon as many of the Bloom fuel cells that are being powered by natural gas.

Five Bloom fuel cells have a capacity of 500 kilowatts, which is the equivalent power for about 500 houses or five large office buildings. Each Bloom fuel cell costs around $700,000 to $800,000 before subsidies, so NTT is spending a couple million dollars on the installation.

Data center operators are looking for ways to make their facilities more energy-efficient and greener as a way to cut growing energy bills and also to highlight company sustainability. While fuel cells are still not commonly used to power data centers, Bloom has been slowly growing its customer list of telcos and Internet companies that want to use the Bloom boxes for part of their data center operations.

Earlier this month, AT&T said it plans to install a whopping 7.5 MW worth of Bloom fuel cells (that’s 75 fuel cells) at 11 AT&T offices in California. AT&T said it would use the fuel cell power for data centers as well as administration offices and facilities that house network equipment.

Fuel cells likely won’t be used as a main, or stand alone, power source for a data center. As we pointed out on GigaOM Pro (subscription required) last year, data centers need a power source that is so-called “five nines” (99.999 percent). Google has said the Bloom Box it was using on its campus had an availability rating of 98 percent, which translates into around seven days of downtime a year: no good for a stand alone power source for a data center running web sites that can’t go down.

Bloom has also found success with data center operators in California because state subsidies make the Bloom boxes a lot more economical in California. Customers in the state include Google, eBay and Adobe .

Top image is NTT’s installation, and the bottom is the installation at Adobe.

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AT&T to install Bloom Energy fuel cells

Silicon Valley’s high-profile fuel cell company Bloom Energy has scored its first deal with a telco: AT&T. On Tuesday, AT&T said it plans to install 7.5 MW of Bloom’s fuel cells, which it calls Bloom Energy Servers or Bloom Boxes, at 11 AT&T offices in California, including Redwood City, San Jose and San Diego. AT&T will use the fuel cell power for administration offices, data centers and facilities that house network equipment.

Nine-year-old Bloom Energy sells an industrial-sized fuel cell (which looks like a large refrigerator) that uses a chemical reaction to produce electricity. The Bloom Boxes suck up oxygen on one side and fuel (usually natural gas or biogas) on the other side, and produce power on-site for companies in a more efficient and less carbon-intensive manner than using the grid (depending on what fuel the company uses).

Bloom Energy, which has drawn in at least $400 million in venture capital money from investors like Kleiner Perkins over its lifetime (and reportedly more than that), attributes the secret sauce of its Bloom Boxes to ceramic discs stacked together and interspersed with plates made of a metal alloy. Bloom Energy CEO K.R. Sridhar originally came up with the idea for the Bloom Box after developing a device for NASA that would be able to create oxygen on Mars and decided to reverse the process.

So far Bloom has done much of its business within California, because California offers fuel cell installers significant subsidies. Companies with a lot of operations in California like Google, eBay, Adobe , and Kaiser Permanente, have taken advantage of the state subsidies to deploy Bloom’s boxes in an effort to reduce their carbon footprints and gain some green cred.

Telcos are no strangers to using fuel cells for their base stations in remote regions. For example, Sprint is doing a 250 fuel cell test for backup power for its network in the U.S. using a Department of Energy grant, and Vodafone spinout P21 is testing mobile telecom backup fuel cells in Europe.

AT&T’s 7.5 MW fuel cell deal, or roughly 75 Bloom Boxes, is a large one for Bloom. Each Bloom Server provides 100 kW of power each, and costs between $700,000 and $800,000 before subsidies, so AT&T is likely spending in the $50 million range before subsidies for this carbon-reducing tactic. (I’m double checking on these figures with Bloom and will update if needed). 7.5 MW of power can provide 62 million kilowatt-hours (kWh) of energy per year, which is enough to power 5,600 homes per year.

Bloom has also been aiming to sell its fuel cells to utilities, though this is a harder market to crack. While the company announced a tentative huge deal with utility Delmarva Power & Light in Delaware, that deal is contingent on certain regulations. However, utilities generally report that they aren’t so interested in fuel cells.

Bloom’s other new strategy to garner business is selling fuel cell power as a service, in much the same way that solar companies sell solar power: Make a 20-year deal with a fixed rate for power, but with no, or little, upfront cost for the fuel cell.

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