Ceres Power Shares Skyrocket as Delta Electronics Secures Hydrogen License

In a groundbreaking development, Ceres Power (CWR.L), a leading UK clean technology company, witnessed a remarkable 51% surge in its shares on Thursday following the announcement of its inaugural hydrogen license agreement with Taiwanese electronics manufacturing giant Delta Electronics (2308.TW).

At 0848 GMT, Ceres Power shares displayed an impressive 48.5% surge, marking the most significant daily jump since 2012. The collaboration with Delta Electronics encompasses a substantial revenue of £43 million ($54.57 million) for Ceres, attributed to technology transfer, development license fees, and engineering services.

Berenberg analysts, in a note, maintained their 'buy' rating on Ceres Power, emphasizing the company's market value of approximately $370 million as of the previous day's close. They reiterated Ceres Power as a preferred name in the burgeoning hydrogen sector, lauding the positive implications of the deal.

The historic agreement involves Delta Electronics gaining access to Ceres Power's Hydrogen energy stack technology portfolio, with the transaction totaling around GBP 43 million. This collaboration positions Ceres as a global leader in solid oxide fuel cell (SOFC) and electrochemical technology.

Delta & Ceres Power Electronics envisions

Delta Electronics envisions integrating Ceres energy stack technology with its own cutting-edge power electronics and thermal management technologies. The aim is to develop solid oxide fuel cell (SOFC) and solid oxide electrolysis cell (SOEC) systems for hydrogen energy applications, with production slated to commence by the end of 2026. These systems are poised to enhance Delta's green solutions across diverse sectors such as chemicals, energy, transportation, and steel.

Delta's CEO, Ping Cheng, expressed optimism about the role of hydrogen in the global transition towards net-zero and highlighted the reliability and high efficiency of SOFC and SOEC systems in electricity generation. These systems are expected to find applications in micro-grid setups, distributed power systems, and mission-critical facilities like data centers.

Phil Caldwell, CEO of Ceres, welcomed the partnership with Delta, emphasizing the latter's global expertise in mass manufacturing, power electronics, and system integration. Caldwell expressed confidence that Delta could deliver efficient clean hydrogen solutions utilizing both SOFC and SOEC technologies.

As part of the collaboration, Delta will establish a 'Net-zero Science Laboratory' at its Tainan manufacturing complex, focusing on the development of zero-carbon technologies, including hydrogen energy. The collaboration aims to accelerate the industry globally, contributing to carbon reduction targets.

Delta plans to undertake product development

Delta plans to undertake product development and production line integration at its Tainan plant from 2024 to 2026, with Ceres providing engineering service support. Production of the technology is anticipated to commence by the end of 2026.

In addition to licensing key energy stack technologies, Delta intends to integrate its smart energy solutions, including microgrid applications and energy management platforms, with the hydrogen energy systems to offer comprehensive and flexible low-carbon infrastructure solutions to its customers.

Ceres' stack technology serves as the core for both SOFC and SOEC applications. The SOFC can generate electricity, water, and heat by reacting oxygen with hydrogen or methane, boasting higher power generation efficiency compared to centralized gas-fired power generation units. The technology is particularly suitable for facilities requiring stable power, given its ability to be built near places with electricity demands, minimizing transmission loss and ensuring stability during the distribution process. The collaboration between Ceres Power and Delta Electronics signifies a significant leap forward in the pursuit of efficient and sustainable hydrogen energy solutions on a global scale.