Ceres Inc (O:CERE) has signed a joint development agreement (JDA) with Honda R&D Co to develop solid oxide fuel cell stacks using Ceres’s patented Steel Cell technology. This follows on from a JDA announced in October 2014. We leave our estimates unchanged, noting that the new agreement presents opportunities to deploy the technology in additional market segments.
Follow-on JDA shows strengthening relationship
Following a year-long evaluation of the Steel Cell technology, which concentrated on performance, robustness and ability to handle repeated power cycles, in October 2014 Ceres Power signed a JDA with Honda to jointly develop a fuel cell stack using the Steel Cell technology. This would be built in the UK and tested in Japan to deploy in 1-5kW systems. The results from this phase met the performance targets, leading to the signature of a follow-on JDA. The relationship is clearly strengthening, as this is the first time that the client has given permission to be named. Moreover, this new phase also includes a third party, which is being lined up with the intention that it may ultimately manufacture fuel cells in volume using Ceres’s proprietary process.
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