The VPS Energy Storage Solution— Unitized Solid Oxide Fuel Cell Electrolyzers (SOFCEL)

1. The VPS Energy Storage Solution—Unitized Solid Oxide Fuel Cell Electrolyzers (SOFCEL) Robert Stokes, PhD President & CEO Versa Power Systems Inc.Littleton, Colorado Denver, CO 14 October 2011

2. VPS Ownership Company Overview • Versa Power Systems is a private company based in Littleton, Colorado • .~$110 million in product development projects through 2011- non-dilutive 2011.05.24_to Boeing

3. Company Overview- 32,000 ft2 of research & pilot manufacturing facilities • Pilot manufacturing and fuel cell development • As-received powders → cells → stacks → stack modules Tape Casting Screen Printing One Step Co-Firing Test Infrastructure

4. 2011.05.24_to Boeing VPS’s 32,000 square foot facility contains stack product development infrastructure

5. 2011.05.24_to Boeing VPS’s 17,000 square foot facility contains systems product development infrastructure

6. Versa Power Systems’ Projects

7. DARPA Vulture II / Boeing Project • Overall objective is to develop technology that will enable an airborne payload to perform uninterrupted intelligence, surveillance, and reconnaissance over an area of interest • pseudo-satellite capability, in an aircraft package • 5 year aloft • Versa Power Systems to deliver a high efficiency, light weight, energy storage systems (ESS) • In the System trade studies-- SOFCEL identified as best fit • VPS ESS systems enable continuous flight: 90 day, full-flight demo • Program complete early 2014, follow-on programs possible http://boeing.mediaroom.com/index.php?s=43&item=1425

8. e- e- e- e- _ O2 O2 + Cathode Anode O2 + 4e- —u 2O= 2O= —u O2 + 4e- e- e- e- O= O= O= Electrolyte Electrolyte O= e- e- e- 2H2 + 2O=—u 2H2O + 4e- 2H2O + 4e- —u 2H2 + 2O= Anode Cathode _ H2 H2 + H2O H2O So- how does Energy Storage using SOFCEL get applied, commercially? • Unitized, Solid Oxide Fuel Cell/Electolyzers (SOFCEL) are energy storage and conversion devices. They are capable of operating in both power generation mode (SOFC) and electrolysis mode (SOEL) • SOFCEL can integrate renewable production of electricity and hydrogen when power generation and steam electrolysis are coupled in a system, which can • turn intermittent solar and wind energy into “firm power”… • or, can turn intermittent power into peaking power, to offset gas turbine peaking plants, and allow coal plants to run baseload. Power Load

9. The Market Opportunities: the promise for a multifunctional energy storage facility • Baseload arbitrage, • Transmission support, • Energy services, and • Renewable energy storage/peak load arbitrage e.g.: Renewable Energy Sales into Peak Market Prices-- With Energy Storage

10. The NREL Study Conclusion • Lowest Levelized Cost of Electricity (LCOE): • Compressed air energy storage (CAES) • Pumped Hydro • Summary: • Hydrogen is competitive with batteries and could be competitive with CAES and pumped hydro in locations that are not favorable for these technologies. • An appendix to the NREL Study evaluated the VPS Unitized, SOFCEL: • “Integration of electrolysis and fuel cell functions into a single piece of equipment could: • Reduce capital cost • Increase utilization • Improve round-trip efficiency” • LCOE? Almost ties CAES and Pumped Hydro; beats the others.

11. Summary • Encouraging results are being obtained in the areaof SOFCEL • Cell materials development on-going to improve steady-state SOEL degradation and cyclic performance • SOEL stack operation demonstrated, however more development required • Analysis to define system based operating conditions are under development • Electricity and Stability- • It's what the electric power transmission system needs and it's what the VPS unitized, SOFCEL energy storage system can provide.