Fuel Cell Price Point  

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ferrisg
(@ferrisg)
New Member
Joined: 11 months ago
Posts: 2
25/06/2018 9:43 pm  

Can someone discuss if fuel cells are working on their price point in the market.  I want to purchase a fuel cell for carbon reduction to provide my electricity but we are up against a financial hurdle when comparing technologies.  Are fuel cell distributors working to reduce costs?


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Eric Burgis
(@ericb)
Member Admin
Joined: 3 years ago
Posts: 4
27/06/2018 12:37 pm  

Good question.  Fuel Cells are generally more expensive than engines or turbines.  You can do a quick price comparison using the CHP Payback Tool under the Resource area of this website.  It is worth noting that the Federal tax Credit is currently 30% for fuel cells.  This larger tax credit should help overcome some of the capital costs.  The 30% credit does have a phase out period and construction needs to begin before 1/1/2020 for the full 30%.  The credit goes to 26% if construction begins after 12/31/19 and before 1/1/21, then drops again to 22% if construction is between 12/31/20 & 1/1/22.  That tax credit ends on 1/21/24.

Remember that you can also use the bonus depreciation under section 179 of the tax code to write off 100% of the capital cost in the first year.  The typical business is paying around 21% federal tax, so if you can write off 100% of the capital cost against income, this will save you 21% in tax you would have had to pay.  Assuming that your business has income that exceeds the combination of the 30% tax credit plus 21% of the capital cost, you can fully realize both of these credits.  Its 51% of the total cost coming back to you with the first tax return after the system is installed.  This certainbly helps with the higher system cost.


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