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Europe’s first fuel cell mCHP for homes

“development, market entry and its challenges”

October 7th, 2014

Toshiki Shimizu

Panasonic Corporation

World of Energy Solutions ,Oct 6-8 2014

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IV. Trends for Spread and Expansion

II. Panasonic’s Latest Development

I. The Energy Situation

III. Activities for Global Expansion

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IV. Trend for Spread and Expansion

II. Panasonic’s Latest Development

I. The Energy Situation

III. Activities for Global Expansion

4Japanese Energy Policy Direction

■Direction of New “Energy Basic Plan”(April 2014, Cabinet Council)

◆Nuclear Power is important as a base load power source

◆Further expansion of renewable energy usage

◆Acceleration for realization of hydrogen society

◆Expansion for utilization of clean usage of fossil fuel

◆Deregulation for electricity and natural gas retail

Hydraulic8.5%

Hydraulic8.4%

Oil7.5% Oil

18.3%

LNG29.3%

Coal25.0%

Coal27.6%

LNG42.5%

Nuclear28.6%

New Energy1.1%

New Energy1.6%

Nuclear1.7%

FY201010,06BilKwh

FY20129,41BilKwh

Before the Earthquake

After theEarthquake

Fuel Cell is basic technology

for utilize of hydrogen

Source: Federation of Electric Power Companies 「Constitution of Power Generation amount by Power Source in the year of 2012」Based on the released information in 2013.May.17

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IV. Trend for Spread and Expansion

II. Panasonic’s Latest Development

I. The Energy Situation

III. Activities for Global Expansion

6Mechanism of Fuel Cell System■Chemical reaction between hydrogen and oxygen

generates electricity, as well as hot water.

Fuel Cell Cogeneration System Power Generation

Natural Gas

Air (Oxygen)

Hot water storage tank

Back up heat source

Fuel Cell UnitHot water storage unit

Generation

Fuel Processor

Stack

Inverter

Exhaust heat

Hydrogen

Hot waterElectricity

DC Electricity

AC Electricity

CH

HHH

HHMethane

WaterHydrogen

CO２

＋＋

OHH

OHH

HHHH HH

CO O

eeHH

H +

O O

e e

OH H

Heat

Membrane

Hydrogen Oxygen

Electricity

H + H +

Electrode

－－

－ －

HH

Reaction in Fuel Processor

By reaction betweenhydrogen and oxygen

Power & Heat generation

Heat collecting

device

Electrode

7Merit of Fuel Cell System

■Fuel cell generates electricity where it’s used for efficient utilization of precious energy

◆ Reduction of CO2 emissions: 1.3t / year

◆ Reduction of household energy cost:60,000 yen / year

Environmental and Economical Effect of Fuel Cell

595 (14.2)

The rated value of new Ene-Farm

Equivalent to CO2 volume that beech tree forest of approx. 2,800 m2 in size absorb

Thermal Power Plant

ConsumerElectricity

Gas

Energy Efficiency of Power Plant Energy Efficiency of Fuel Cell

Source: Law regarding streamline of energy use

Primary Energy Primary

Energy

Non-usable Heat

*Data from Panasonic

Unused Waste Heat & Power Lost During Transmission

ElectricityElectricity

Hot water

Consumer

LNG Tank

Electricity Hot water

41% 95%(85.8)

Efficiency shown in LHV, shown in ( ) HHV

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1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

NEDO

NEF

2011 2012 2013

■ May, 2009 The world’s first commercial model launched and started sales■ Developed the 3rd generation model for market penetration

Advanced Cogeneration & Energy Utilization Center JapanACEJ

Basic technologydevelopment

Developmentfor practical use

Development for commercialization

Large-scale field test Commercial sales Introduction Enlarged

IntroductionPenetration

Installation at Prime Minister official residence

Opening of Kusatsu Factory

Practical-use ExperimentsPenetration research project Strategically practical technology development

Experimentalfield research Large-scale field test project

FCCJ (Fuel Cell Commercialization Conference of Japan)

FCA (Fuel Cell Association)Promote initiatives with the government &

related industries

Panasonic

Government

Industries

’09 model

’11 model

’13 model

First shippingceremonyCompany

President’s Project starts

Development History of Fuel Cell system

2014

Europe model

Globalization

NEDO

NEF

9Development progress of Fuel Cell System1st generation(2009) 2nd generation(2011) 3rd generation(2013)

１２０ｃｍ ９０ｃｍ ７５ｃｍ

Durability

Installation size

１０００w～３００w ７５０w～２５０w ７５０w～２００wElectric output

＋

（Peak load boiler）

World highesttotal efficiency

９５％（ＬＨＶ）

※２：ＤＳＳ＝Daily Start Stop

４０，０００ｈ（ＤＳＳ）※2 ５０，０００ｈ（ＤＳＳ）※2 ６０，０００ｈ（ＤＳＳ）※2

Possibility ratioto install Tokyo urban area ２４％ ３６％ ４８％

RRPby Tokyo gas

１００ ７９ ５７ （index number）

※1：as of 17th Jan, 2013, Panasonic survey

※1

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C. Installation at apartment D. Various Installation＜Unit separation＞＜Unit to Unit＞

A. Installation at private house

Installation example in JapanB. Fuel Cell + PV, Combined Generation

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Topic 1

Fuel Cell mCHP system for high-rise apartment house

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■Installation in the apartment is essential for expansion at urban area

【based on the start construction of new dwelling in FY2012】

※Based on the statistic of new dwelling construction

■Apartment has high volume at urban area

■Feature of the apartment house・Possibility for installation capacity of PV panel is small compare with the

detached houseFuel Cell for apartment house has expected

・Current Fuel Cell is difficult to install for apartment house due to the space and several regulation of the building

Special type Fuel Cell is necessary

Detached

House３７% 52,374

units

Total936,330戸

ApartmentHouse

３７% 347,915units

DetachedHouse６３%

588,415units

Tokyo143,232

units

Kanagawa71,437units

Detached

House５０%

35,659

units

ApartmentHouse５０% 35,778

units

ApartmentHouse

６３% 90,858

units

Development of new Fuel Cell system for apartment

Tokyo and KanagawaWhole country

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■Accommodate a needs from the standards and installation location of high-rise apartment house

For apartment house model, launched in April, 2014

Installation Image forapartment

・Comply with the Building Standards Act in Japan

２．Specialization for apartment

１．Pipe shaft space installation

３．Wider variation of installation

・Earthquake resistance, resistance to wind

・Exhaust variations, slim dimension

14Adoption our products

Location ： Shinagawa, Tokyo

Number of houses ：３５６

Structure ： Ferroconcrete , Rise 18 stories high

Final Completion ：July 2015

TOKYU Land CorporationLocation ： Nakanobu, Tokyo

Number of houses ： 100

Structure ： Ferroconcrete, Rise 15 stories high

Final Completion ： Feb 2015

SOGO Land Corporation

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Topic 2

Continuous Power Generation

16Function of the continuous Power Generation

Power unit Conversion

Switchboard

WaterNatural gas

Fuel Cell

Backup boiler

Grid

Outlet forblackout

Normaloutlet

■Supply the minimum electric power to the home in case of the blackout

■Longtime blackout was occurred by Great East Japan EarthquakeClose-up for the electric power supply at disaster

and presence of gas energy■Home appliances and heating appliances will be stopped by the blackout in Europe

Operation of the equipment at blackout will be important

“Security and Safety of energy supply” and“importance of the decentralize energy supply”

are the common knowledge in Europe and Japan

refrigerator TV

17Function of the continuous Power Generation■Fuel Cell can be started at stop mode and continue to operate at blackout

Fuel Cell

＋

Launch in Oct.2014（Japanese model only)

GenerationMode

StopMode

Generation continue

StartingGeneration start

Max 1200W（ cont. 700W）

Continuous PowerGeneration System

Gas supply ７００W　（96 hours）（charge to internal battery）

５００W　（temporarily）１２００W　（temporarily）

７００W （96 hours）

Gas Stop ― ５００W　（temporarily） ５００W （temporalily）

Continuous PowerGnereation system

（with internal battery）

Fuel Cell

Blackout

Total output

※１：Fuel Cell charges internal battery at blackout

※１

Power unit

Conversionunit

Max 1200W（ cont. 700W）

Blackout

Specification

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IV. Trend for Spread and Expansion

II. Panasonic’s Latest Development

I. The Energy Situation

III. Activities for Global Expansion

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■ The market expansion of Fuel Cell in EU and North Americas is expected from the view point of Gas infrastructure, comparison of Gas and Electricity bill and heat demand

日本アジア大洋州（中・韓・豪）

北米（アメリカ・カナダ）

（独）実証試験 ＰＥＦＣ／ＳＯＦＣ

（英）研究開発 ＳＯＦＣ

（日）商品化 ＰＥＦＣ

（日）11年発売 ＳＯＦＣ

（韓）実証試験 ＰＥＦＣ （米）研究開発 ＰＥＦＣ／ＳＯＦＣ

将来家庭用燃料電池で見込まれる市場ターゲット

欧州（中欧・北欧・東欧・ロシア）

欧州 日本アジア大洋州 北米

６０万台２８００億円

２０万台１２００億円

３０万台１４００億円

１０万台６００億円

ｸﾞﾛｰﾊﾞﾙ総需要 120万台 6,000億円 （2018年）

北米（アメリカ・カナダ）

将来家庭用燃料電池で見込まれる市場ターゲット

欧州（中欧・北欧・東欧・ロシア）

North Americas（USA, Canada）

EU（Middle, North, East EU and Russia）

The Global Market Potential of Fuel Cell

Fuel Cell expecting Market Target

① Rich Gas infrastructure② Big price gap between

Electricity and Gas③ High Heating Demand

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■ Variety of Gas composition ■Difference of Environment ◆Japan ： Outside installation

： Domestic hot water demand

◆Germany ： Inside installation： Space heating demand

・Security for the safety of the ＣＯ density ・Large heating demand (approx. 4 times of Japan)・Adaptation of the local heating circuit system・Secure the performance against various flue pipe

◆Japan ： Liquefied Natural Gas （ＬＮＧ）- Imported by the tanker

◆Germany： Gas Pipe line Network - Mixing gas composition at the each area- Gas composition is changed by the political

reason and the cost factor.

Source ：SYSTEM DEVELOPMENT MAP 2011Gas Infrastructure Europe Web site

radiatorradiator

radiatorradiator

shower

Fuel CellSystem

Adaptation to European Environment

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■Strengthen local product development along with technology development in Japan

R&D base in Langen,

Germany

・Development of the suitable system for local operating condition, installing environment

・On site investigation of natural gas composition

Establish the local developing base

Panasonic activities for market expansion in EU

Since July 2011

Developing the best matching products to the local usage condition with the of early market introduction

Development base in Cardiff,

UKSince September 2012

22Panasonic activities for market expansion in EU

●Difference of business environmentbetween Japan and Europe・Recognition of brand and organization of sales maintenanceand installation are very important

Organization of maintenance・The quick action of maintenance are required for trouble of

heating equipment

Difference of sales system・The organization of the Installer is essential part for the sales of heating equipment

Panasonic has entered into partnership with Viessmann company

■Examination for European heating market

231st European PEM Fuel Cell System

3. Easy to Use

Power Generation : 750WPower Generation Efficiency : 37%Overall Efficiency : 90%

1. High efficiency

Operation and Monitoring by Mobile device

2. Simple constructionFuel Cell unit + Boiler/Hot water tank unit

“Vitovalor 300-P“

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■ Example for Fuel Cell System installation

Example 1 Example 2 Example 3

Viessmann activities for market expansion in EU

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IV. Trend for Spread and Expansion

II. Panasonic’s Latest Development

I. The Energy Situation

III. Activities for Global Expansion

26Fuel cell market expansion in Japan

0

5

10

15

20

25

30

35

40

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

32,900（Estimated）

380K

【Number of U

nits

】

1,400K1,250K

1,030K

700K

450K380K

250K

（Subsidy per units ; JPY）

Subsidy will finish by FY2015

5,000 6,000 13,50024,100

■Owing to the subsidy by the Government, market is growing rapidly since 2009■Cost reduction should be needed because of decreasing the amount of subsidy

(The government will put an end of subsidy by FY2015)■The government sets 1.4 million units accumulated sales target by FY2020

× 1,000

Source : total demand is Panasonic’s estimation by hearing with utility company and situation of FCA application

27For the Wide Spread

Issues and direction for the widespreadIssues and direction for the widespread■Further Cost Reduction

■Strengthen the function as decentralized power supply・Expansion to feasible housings ( Apartment, Office Building )・Application to the Smart Community Utility・Application to various environment and related regulation (the reverse current flow etc)

●System cost reductionby further system simplification

・Development of low cost catalyst (reducing platinum volume)

・Strengthen robust resistance of key devices・Expansion of standard component usage

●Sales increment by global expansionCost reduction by volume production effect

・Application to different Gas composition・Application to the various installation environment

Further Collaboration inGovernment-Academia-Industry

Government Installation Target

2020: accumulation 1.4 million set2030: accumulation 5.3 million set

2005 2008 2012 2015Large Scale Field Test

Market introduction

Spread

Sys

tem

Pric

e

Cost Reduction 1/3

Cost Reduction 1/2

Cost Reduction 1/2

(price at spread)

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For the future

29Fujisawa SST （Sustainable Smart Town）

■Fujisawa SST In 2014 schedule to start move-in Realizing the comfortable life style with ecology, new town forming and services with Panasonic unique solution such as energy management.

★PV and Battery installed in all houses, approx. 1000 houses★Planning to install Fuel Cell to most of houses

Target : Realizing 70% CO2 reduction (vs. 1990) in whole Town

30Establishment of the Hydrogen Energy Society■Ultimate clean “Hydrogen Energy Society” based on the expansion

and evolution of Fuel Cell, and production of hydrogen with reasonable cost2000 2010 2020 2030 2040 2050

Evolution of Gas infrastructure Natural Gas

Introduction, spread and evolution of “FCV”

Spread and evolution of Stationary Fuel Cell

Establishment of Hydrogen station

Hydrogen Infrastructure

HydrogenEnergy Society

Hydrogen type

Residential Fuel Cell

Local supply

of Hydrogen

Fuel Cell VehicleHydrogen station

Production ofHydrogen by

Renewable EnergyLarge-scale

Fuel Cell

Fuel Cell Train

Production of Hydrogen

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Panasonic will achieve

“A better life” and “A better world” for the people in

worldwide by the spread and expansion of Fuel Cell

Thank you very much