Bloom Energy Stock

Bloom Energy Corporation (Bloom Energy) designs, manufactures, sells and in certain cases, installs solid-oxide fuel cell systems (the Energy Servers) for on-site power generation. The company’s Energy Servers utilize innovative fuel cell technology and provides efficient energy generation with lower greenhouse gas emissions as compared to conventional fossil fuel generation.

Bloom Energy is uniquely situated to provide innovative technology solutions to customers at an important moment in the world’s transition to a net-zero carbon energy system. The company manufactures one of the most advanced and versatile energy platforms, which delivers two products: the Bloom Energy Server and the Bloom Electrolyzer. With approximately 1.2 gigawatts of the Energy Servers accepted in more than 1,200 locations and 7 countries, the company’s platform empowers businesses, essential services, critical infrastructure, energy companies, and communities with resilient, reliable, and sustainable energy solutions.

The value propositions for its fuel cell-based power platform are very compelling. Built on the same solid oxide platform, the company develops the Energy Server and the Electrolyzer with predominantly the same supply chain, manufacturing, and engineering expertise.

The company’s Energy Servers are inherently designed to deliver reliable electricity. The company’s system also operates at a 99%+ availability due to its modular and fault-tolerant design, which includes multiple independent power generation modules that can be concurrently replaced during maintenance to provide uninterrupted service. The company’s Energy Servers also have the proven resiliency to withstand weather events, cybersecurity attacks, and other grid outages, providing reliable baseload power while the grid is still grappling with the proliferation of intermittent wind and solar generation. The company’s systems can be installed in a timeline far shorter than building new transmission lines, or any form of large-scale power generation. This ‘Time to Power’ value proposition is particularly meaningful for manufacturers, data centers, hospitals, and retailers, especially when the local utility is unable to provide the additional power to support their load growth or energy goals. With its Bloom Energy Server, the company is also partnering with developers for significant opportunities in waste-to-energy. In some instances, the company is providing power solutions to enable lower carbon intensity renewable fuels, and in other cases, it is providing solutions to use biogas for resilient power across dairies, landfills, and wastewater treatment facilities.

The Bloom Electrolyzer, which produces hydrogen, opens new markets, partnerships, and geographies for the company. The Bloom Electrolyzer is in the early stages of commercialization. But the results have shown its promise. In 2023, for example, the company deployed the world’s largest solid oxide electrolyzer at its NASA Ames Research Center, located in Mountain View, California, and achieved a new record efficiency level of 37.5 kWh of electricity per kilogram of hydrogen generated. The Idaho National Laboratory (INL) has been studying to see how well it could produce hydrogen from electricity and steam from a nuclear facility, and their 2023 results showed that it was the most efficient electrolyzer that they ever tested. The Bloom Electrolyzer diversifies and expands the company’s addressable market to industries with hard-to-abate emissions, such as heavy industries and those seeking zero-carbon transportation fuels. In December 2023, the company announced the Electrolyzer sale in South Korea to its partners SK ecoplant Co., Ltd. (SK ecoplant), a subsidiary of the SK Group, with the technology to be deployed in a government-led project to deploy hydrogen as an energy source in a large-scale green hydrogen for use as transport fuel.

The company is growing its research and manufacturing capabilities based in the United States and South Korea to meet the opportunities in the global markets. As of December 31, 2023, the company had 325 active patents in the U.S. and 145 active patents internationally. In 2023, the company scaled up production at its multi-gigawatt factory in Fremont, California, while streamlining and consolidating operations from its Sunnyvale, California, facility to its Fremont facility. The consolidation and ramp in production capacity during 2023 enabled the company to produce its Energy Server platforms more efficiently. The plans provide for an additional ramp up in production with incremental investments. The company invested in its Newark, Delaware, factory during 2023 to increase production capacity, including a high volume electrolyzer manufacturing line for commercial deployment in North America and Europe.

The company’s major customers include companies in industries, such as utilities, data centers, agriculture, retail, hospitals, higher education, biotech, and manufacturing. The company works with several global financing and distribution partners who purchase and deploy its systems at end-customers’ facilities to provide electricity-as-a-service.

The company’s second-largest market in terms of revenue and installed base of the Energy Servers is South Korea, a world leader in the deployment of fuel cells for utility-scale electric power generation. The company began commercial operation in South Korea in 2018 and has grown its footprint to more than 492 megawatts of deployed Energy Servers across South Korea. SK ecoplant serves as the primary distributor of the company’s systems in the Republic of Korea. In 2021, the company announced an expansion of its existing partnership with SK ecoplant, which included purchase commitments of at least 500 megawatts of power for its Energy Servers between 2022 and 2024 on a take-or-pay basis, the creation of hydrogen innovation centers to advance green hydrogen commercialization, and an equity investment in Bloom Energy.

On December 21, 2023, the company expanded its partnership with SK ecoplant through an incremental purchase commitment of 250 megawatts through 2027 and extended the timing of delivery of the remaining take-or-pay commitment to a minimum purchase commitment under the original agreement.

In 2023, the company expanded its presence in the European market by signing contracts with customers in Italy, the U.K., Germany, and Belgium. The company also strengthened its presence in Asia by signing additional contracts in Taiwan and Thailand. The company is also operating smaller deployments in India and Japan with commercial customers, with additional projects in development in other Southeast Asia locations and Australia.

Products and Services

The company’s solid oxide fuel cell technology platform is the foundation for its Energy Servers and Electrolyzers. Solid oxide fuel cells are more efficient than other fuel cell structures because they run at higher temperatures than other fuel cell technologies.

Bloom Energy Server

The company’s power generation platform, the Bloom Energy Server, is designed to deliver reliable, resilient, clean and affordable energy for utilities and organizations alike. Suitable to operate parallel with the grid, independent of the grid, or as part of a larger microgrid ecosystem, the Bloom Energy Server is based on its proprietary solid oxide technology that converts fuel, such as natural gas, biogas, hydrogen, or a blend of these fuels, into electricity through an electrochemical process without combustion. The electrical output of the company’s Energy Server is designed to be connected to the customer’s main electrical feed, thereby avoiding the transmission and distribution losses associated with a centralized grid system. The modular nature of the company’s solution enables any number of the Energy Servers to be clustered together in various configurations, providing solutions from hundreds of kilowatts to hundreds of megawatts. The Energy Server is designed to be easily integrated into community environments due to its aesthetically attractive design, compact space requirement, minimal noise profile and near-zero criteria air pollutants.

The Energy Server platform can be utilized in the following applications:

Carbon Capture: The company’s Energy Servers, when combined with carbon capture technology, can provide zero-carbon electricity. The company’s natural gas or biogas-fueled Energy Server vents CO2 into the atmosphere as a byproduct. When used to facilitate carbon capture, the Energy Server is configured to vent CO2 for consolidation, compression, and processing for sequestration or other industrial applications. The compression and processing of the anode exhaust can be done by industrial gas companies. Bloom’s anode exhaust, once dried, has 95% purity of CO2.

Combined Heat & Power (CHP): The company released a combined heat and power offering that increases the efficiency of its technology to 85% with a goal of reaching, through continuous improvement, the 90% threshold.

Waste to Energy: Bloom Energy’s solid oxide fuel cells (SOFCs) provide an electrochemical pathway to convert biogas to electricity without combustion, producing carbon-neutral electricity with near zero air pollution and water usage. Bloom Energy Servers can utilize proven, off-the-shelf gas conditioning equipment to process raw biogas into a suitable fuel for power generation.

Marine Fuel Cells: Bloom’s platform is well positioned to address impending emissions regulations and offer higher efficiency than traditional power sources. Marine fuel cell powered ships can obtain immediate emissions reductions for the cleanest and most efficient operation by utilizing liquefied natural gas (LNG) as the primary fuel source.

Value Proposition

Resiliency: The company’s Energy Servers avoid the vulnerabilities of conventional transmission and distribution lines by generating power on-site. The system operates at very high availability due to its modular and fault-tolerant design, which includes multiple independent power generation modules that can be hot-swapped to provide uninterrupted service. Unlike traditional combustion generation, Bloom Energy Servers can be serviced and maintained without powering down the system. Importantly, Bloom Energy Servers that utilize existing natural gas infrastructure rely on a redundant underground mesh network, intended to provide for extremely high fuel availability that is protected from the natural disasters that often disrupt the power grid.

Sustainability: The company’s Energy Servers uniquely address both the causes and consequences of climate change. The company’s projects lower carbon emissions by displacing less-efficient fossil fuel generation on the grid, which improves air quality, including in vulnerable communities, by generating electricity without combustion, offsetting combustion from grid resources as well as eliminating the need for dirtier diesel backup power solutions. The company’s microgrid deployments provide customers with critical resilience to grid instability, including disruptions caused by climate-related extreme weather events. The company’s Energy Servers are designed to achieve this while emitting near-zero criteria pollutants, consuming no water during steady-state operation, and minimizing land use impacts due to its high-power density.

Predictability: The company offers its customers the ability to lock in the cost of electric power over the long term. In regions where most of its Energy Servers are deployed, the company provides electricity to its customers. The company provides customers with a solution that offers all of the fixed equipment and maintenance costs for the life of the contract. The company’s Energy Servers are designed to deliver 24x7 power with very high availability, mission-critical reliability and grid-independent capabilities.

Time to Power: The company’s Energy Servers were designed to provide ‘quick time to power’ — the ability to be deployed and generate power in weeks – an important value proposition for customers needing to ramp up power quickly.

Bloom Electrolyzer

The company is uniquely positioned for the hydrogen future of tomorrow. The Bloom Electrolyzer is designed to produce scalable hydrogen solutions based on the same solid oxide platform as the company’s Energy Server. The Bloom Electrolyzer is ideal for applications across gas, utilities, nuclear, concentrated solar, ammonia and heavy industries. The company’s solid oxide, higher-temperature Electrolyzer is designed to produce hydrogen onsite more efficiently than lower-temperature PEM and alkaline electrolyzers. The Bloom Electrolyzer is designed to produce green hydrogen when using low- or zero-carbon electric power. The hydrogen produced onsite at a customer’s facility can be used as fuel or stored for consumption at a later point.

Value Proposition

Higher Efficiency: Fuel (steam) supplied to the Bloom Electrolyzer undergoes an electrochemical reaction at 700-900 degrees Celsius which is higher than other available technologies.

Scale: The company’s commercial field experience in fuel cells directly transfers to its hydrogen production products, as it builds upon the same core platform, supply chain, manufacturing process, partners, and advanced remote software monitoring across all its products and applications. The company’s experience as a developer of fuel cell projects, in addition to its role as an original equipment manufacturer (OEM), enables it to engage with customers and deliver turnkey projects.

Modular Design: As with the Bloom Energy Server, Bloom’s modular design allows for targeted maintenance in individual electrolyzer modules while the rest of the facility continues to operate.

Intellectual Property

As of December 31, 2023, the company had 325 active patents and 141 patent applications pending in the U.S., and it had an international patent portfolio comprising 145 active patents and 414 patent applications pending. The company’s U.S. patents are expected to expire between 2022 and 2042.

The company pursues the registration of its domain names, trademarks, and service marks in the U.S. and some international locations. Bloom Energy and the BE logos are the company’s registered trademarks in certain countries for use with the Energy Servers and its other products. The company also holds registered trademarks for, among others, Bloom Box, BloomConnect, BloomEnergy, and Energy Server in certain countries. In an effort to protect its brand, as of December 31, 2023, the company had 7 registered trademarks and 1 pending application in the U.S. and 46 registered trademarks and 15 pending applications across Australia, Brazil, Canada, Chile, China, the European Union, India, Israel, Japan, Mexico, Oman, Singapore, South Africa, Republic of Korea, Saudi Arabia, Taiwan, the United Arab Emirates, and the United Kingdom.

Services

The company provides operations and maintenance agreements (O&M Agreements) for all of its Energy Servers, which are typically renewable at the election of the customer on an annual basis. The customer agrees to pay an ongoing service fee, and in return, the company monitors, maintains, and operates the Energy Servers systems on the customer’s or owner’s behalf. The company services and maintains every installed Energy Server worldwide.

As of December 31, 2023, the company’s in-house service organization had 136 dedicated field service personnel distributed across multiple locations in both the U.S. and internationally. The company’s standard O&M Agreements include full remote monitoring and 24x7 operational capability over the systems, as well as scheduled and unscheduled maintenance, which in practice includes preventative maintenance, such as filter and adsorbents replacements and on-site part and periodic fuel cell replacements.

The company’s two Remote Monitoring and Control Centers (RMCC) provide 24x7 coverage of every Energy Server installation worldwide. By situating its RMCC centers in the U.S. and India, the company is able to provide 24x7 coverage and also provides a dual redundant system with either site able to operate continuously should an issue arise. Each Energy Server the company ships includes instrumentation and a secure telemetry connection that enables RMCC to monitor over 500 system performance parameters in real time. This comprehensive monitoring capability enables the RMCC operators to have a detailed understanding of the internal operation of the company’s Energy Servers. Using proprietary, internally developed software, the RMCC operators can detect changes and override the onboard automated control systems to remotely adjust parameters to maintain optimum system performance. In addition, the company undertakes advanced predictive analytics to identify potential issues before they arise and undertake adjustments prior to a failure occurring.

Purchase and Financing Options

In order to appeal to the largest variety of customers, the company makes available several options to them. Both in the U.S. and internationally, it sells its Energy Servers directly to customers. In the U.S., the company also enables customers’ use of the Energy Servers through a Power Purchase Agreement and a Managed Services Agreement (whereby it sells and leases back the Energy Servers in order to supply energy to customers), each made possible through third-party financing arrangements.

PPAs are typically financed on a portfolio basis whereby the company makes direct sales of PPAs to investors.

Sales, Marketing and Partnerships

The company sells its products through a combination of direct and indirect sales channels. At present, most of its U.S. sales are through the company’s direct sales force, which is segmented by vertical and type of account. The company is expanding its relationship with utilities and other commercial customers across the U.S. The company has developed a network of strategic advisors that originate new opportunities and referrals to Bloom Energy, which has been a valuable source of high-quality leads.

The company pursues relationships with other companies in areas where collaboration can produce product advancement and acceleration of entry into new geographic and vertical markets. SK ecoplant in the Republic of Korea is the company’s strategic power generation and distribution partner. In 2021, the company announced an expansion of its existing partnership with SK ecoplant that includes purchase commitments for at least 500 megawatts of its Energy Servers between 2022 and 2024 on a take-or-pay basis, the creation of hydrogen innovation centers in the U.S. and the Republic of Korea to advance green hydrogen commercialization, and an equity investment in Bloom Energy. On December 21, 2023, the company further expanded its business partnership with SK ecoplant through the increase of SK ecoplant’s purchase commitments for Bloom Energy products of 250 megawatts through 2027 and extended the timing of delivery of the remaining take-or-pay commitment under the original agreement.

Seasonal Trends

The company’s business and results of financial operations are subject to industry-specific seasonal fluctuations with the majority of bookings completed in the second half of a fiscal year (year ended December 31, 2023).

Government Regulations

Some of the company’s tax equity partnerships in which the company participates are subject to regulation under the Federal Energy Regulatory Commission (FERC) with respect to market-based sales of electricity, which requires the company to file notices and make other periodic filings with FERC. In addition, the company’s project with Delmarva Power & Light Company is subject to laws and regulations relating to electricity generation, transmission, and sale at the federal level and in Delaware.

Product safety standards for stationary fuel cell generators have been established by the American National Standards Institute (ANSI). These standards are known as ANSI/CSA FC-1. The company’s products are designed to meet these standards. Further, the company utilizes the Underwriters’ Laboratory, or UL, to certify compliance with these standards. Energy Server installation guidance is provided by NFPA 853: Standard for the Installation of Stationary Fuel Cell Power Systems. Installations at sites are carried out to meet the requirements of these standards.

History

The company was founded in 2001. It was incorporated in the state of Delaware in 2001. The company was formerly known as Ion America Corporation and changed its name to Bloom Energy Corporation in 2006.