CFU - Ceramic Fuel Cells

[fureien]

this stock is begining to make a real dent in my portfolio. im already down 30%. i keep holding cause i see long term potential and the buying volume is still high. how it keeps dropping is beyond me

 

[Hedders]

this stock is begining to make a real dent in my portfolio. im already down 30%. i keep holding cause i see long term potential and the buying volume is still high. how it keeps dropping is beyond me

Same for me- it's a real drag just now. It's too volatile to see any trend other than spikes when good news comes out. It'll probably be that way until real sales of the hardware start coming in large volumes

 

[sydneysider]

Smurf1976,

The other interesting issue that is lacking in commentary are the installation and management/ maintenance costs. Three/four sets of tradesmen are required to instal such a system. (1) As the unit deals with water, gas and electricity and gives off heat it will require venting systems for gas and heat. Typically tank water heaters have a heat vent off the top that goes to the outside of the dwelling and the gas unit will also require venting. Possibly also requires some sort of floor seal and drain around the unit if it sprang a water leak (2) electrical connections to the whole house probably require some sort of control or fuse box and extensive wiring? (3) gas connections to the unit
(4) some sort of maintenance contract to make sure it operates at 100% all of the time. What happens if it fails? (5) Battery management as even CFU says they have a 5 year life. Do they gradually die down like a power bulb in a movie projector or just shut down on a hot day like a bad car battery? (6)
I suspect that all of this may require a building permit from local authorities and inspection on completion?

How much cost does all of this add to the unit cost. Other issues that may get raised include house insurance adjustments etc?

 

[Smurf1976]

Smurf1976,

The other interesting issue that is lacking in commentary are the installation and management/ maintenance costs. Three/four sets of tradesmen are required to instal such a system. (1) As the unit deals with water, gas and electricity and gives off heat it will require venting systems for gas and heat. Typically tank water heaters have a heat vent off the top that goes to the outside of the dwelling and the gas unit will also require venting. Possibly also requires some sort of floor seal and drain around the unit if it sprang a water leak (2) electrical connections to the whole house probably require some sort of control or fuse box and extensive wiring? (3) gas connections to the unit
(4) some sort of maintenance contract to make sure it operates at 100% all of the time. What happens if it fails? (5) Battery management as even CFU says they have a 5 year life. Do they gradually die down like a power bulb in a movie projector or just shut down on a hot day like a bad car battery? (6)
I suspect that all of this may require a building permit from local authorities and inspection on completion?

How much cost does all of this add to the unit cost. Other issues that may get raised include house insurance adjustments etc?

It will depend on local regulations but:

1. A "smart" electricity meter to accommodate import and export from the grid. The electricity utility will supply this, with installation by either them or an electrician depending on location (state, country according to local rules).

2. Plumbing connections. In Australia, many plumbers will be able to do both gas and electrical but that's not always the case. Likewise the vents could also be installed by a plumber.

3. The water tank will require a base and drain if installed anywhere where a leak would cause property damage.

4. Electrical connection from the unit back to the switchboard and some work in the switchboard as well.

5. Possibly some building work to accommodate wherever it is located. In most cases that wouldn't be necessary but it depends on th specific circumstances.

That's assuming the property already has water, gas and electricity connected.

As for the likely consumer uptake in practice, well I'll just say a few things and let you judge for yourself.

A. Right now it's possible for anyone with a taxable income under $100K in Australia to get a 1kW solar (electric) system supplied and installed free or very close to it due to government rebates. Despite this, the vast majority of eligible people have not applied.

B. Similar with solar hot water. A reasonable idea given the rebates but electric water heating still dominates with gas accounting for most of the rest.

C. Energy saving globes have been around since the 1980's. It took legislation to force people to use them despite the financial and environmental advantages.

D. Diesel engines have always been far more efficient than petrol. Yet despite various oil crises, concern about climate change and the cost of fuel, most cars on the road in Australia are petrol powered. That varies in some countries however - generally those where petrol costs a lot.

So my point here is that even if it stacks up on paper, that doesn't mean consumers will adopt the technology unless forced. And the nature of this device is that it isn't suitable for installation in all situations, thus making it difficult to force consumers to use it.

Half of Australian homes don't have gas connected to start with. And if you look at a country like France, New Zealand or the US then from a national energy / policy / strategic perspective they're not likely to want to shift a large portion of power generation to gas no matter what the generation technology. Such a move just wouldn't make sense no matter how you look at it. Russia and the Middle East dominate global gas reserves, the US has diminishing gas resources but heaps of coal, Europe depends on imports (hence France with all those nuclear plants), places like NZ are heavily reliant on renewables (mostly hydro) and looking to increase that further.

Only real exception to all of this is heating in cooler climates. Most homes in Victoria, Tasmania or colder parts of Europe have reasonably economical heating systems. And that comes down to the outright running cost - if it costs $2000 a year to run then consumers will scrap it in favour of something cheaper but if it's only $500 then they won't bother no matter what the efficiency or possible % savings. Hence oil heaters died out quickly in cooler climates when prices rose but incandescent lights are still with us today and solar water heating struggles to gain market share after half a century of development and marketing. Likewise taxi drivers run LPG or in some countries diesel but ordinary motorists aren't as interested and nobody bothers with, for example, trying to make a lawnmower more fuel efficient - it comes down to actual costs not some possible % saving.

Overall, yes I can see a market for this technology. But go forward 20 years and I'm very confident that the vast majority of global electricity generation will be from coal, nuclear, hydro and large scale gas-fired plants with non-hydro renewables accounting for most of the rest.

Look at the situation in the EU. With increasing reliance on imported gas, they're just not going to deliberately rely almost entirely on it for everything. They'll either make renewables work somehow, go back to coal or build a whole lot of nuclear plants. Most likely we'll see some of each.

Looking at Australia, we're not likely to burn all the gas at home when coal's a lot cheaper and international buyers are willing to pay an increasing price for LNG. We'll build some gas-fired plants until prices rise, then we'll focus on coal, renewables and possibly nuclear. Gas is a major power source (as a % of the total) in WA, NT and SA but it won't likely end up that way in Qld, NSW or Vic unless someone finds a truly massive gas field that nobody's seriously expecting.

And Tas will just keep pushing on with renewables as it's done for the past 116 years, a situation driven by local resource availability and economics rather than CO2 etc. Tas is actually a pretty good place to demonstrate all of this. No known commercial oil or gas and very little (poor quality) coal. But there's a massive world class wind resource, millions of tonnes of wood going to waste and still more untapped hydro than the entire Snowy scheme. Looks like there's some good prospects for geothermal too. Now, with all of that do you honestly believe we're about to start spending a fortune on imported gas? Short term yes, it's an easy and reasonably chap (for now) way out of the present power generation shortfall given the time it takes to develop renewables. But it's long been the plan to get out of it or offload the risk onto some unsuspecting investment bank before it gets expensive.

There's a market for Bluegen yes, but it's a supplement to centralised generation and not a replacement for it unless you're in someplace where it makes sense to run everything on gas and there's a use for the heat.

 

[newanimal]

Any thoughts on the technical picture? Looks to have made a very steep run from the second week of May from about .08 to .28 breaking two resistance points and has retraced about 50% of that now at support bout .15.

 

[S73417H]

Any thoughts on the technical picture? Looks to have made a very steep run from the second week of May from about .08 to .28 breaking two resistance points and has retraced about 50% of that now at support bout .15.

I have a buy on this stock at 0.15 but I would also love to know other opinions of this stock from a technical side of things. If it blows through 0.15 looks like it will probably drop another 2/3 all the way down to 0.10.

Thoughts, comments?

 

[bagasas]

Looking at Australia, we're not likely to burn all the gas at home when coal's a lot cheaper and international buyers are willing to pay an increasing price for LNG. We'll build some gas-fired plants until prices rise, then we'll focus on coal, renewables and possibly nuclear. Gas is a major power source (as a % of the total) in WA, NT and SA but it won't likely end up that way in Qld, NSW or Vic unless someone finds a truly massive gas field that nobody's seriously expecting.

There are truly massive gas reserves in Australia which have only recently started to be appreciated: coal seam gas in Queensland and NSW. Most of these reserves are yet to be certified. Arrow Energy, for example, estimate that they control 70,000 petajoules of CSG. For comparison, the North West Shelf has 40,000 petajoules of gas. The various LNG projects have been proposed because the gas can be produced much faster than the Australian population can consume it.

 

[Smurf1976]

There are truly massive gas reserves in Australia which have only recently started to be appreciated: coal seam gas in Queensland and NSW. Most of these reserves are yet to be certified. Arrow Energy, for example, estimate that they control 70,000 petajoules of CSG. For comparison, the North West Shelf has 40,000 petajoules of gas. The various LNG projects have been proposed because the gas can be produced much faster than the Australian population can consume it.

Indeed that is true.

But the aim of current thinking is simply to get the gas out of the ground as fast as possible so as to maximise shareholder returns. They're not going to sell it cheaply for domestic use when there's the option of LNG.

What they'll almost certainly do is price domestic sales at the world market price for LNG less the cost to produce LNG from raw natural gas.

An example with another commodity illustrates the point. If I have 1000 tonnes of wood then that's worth $100,000 as cut firewood delivered to households or $100 per tonne. If it costs me $60,000 to employ someone to cut and transport the wood, then the wood I have "as is" is worth the remaining $40,000 or $40 per tonne. OK so far...

Now let's say the market price of fire wood doubles to $200 per tonne. Now my wood is worth $200,000 on the market less $60,000 to get it there. Hence my uncut wood "as is" is now worth $140,000 or $140 per tonne.

Bottom line is if that situation happened then I'm not going to be selling anyone wood for $40 once I've got the option of selling for $140. The only way I'd agree to sell it cheaply is if I had no other way of selling it.

Same with the gas companies. At the moment they can't sell all they can produce and it's been that way for 40 years, hence it's cheap.

But let them build a lot of LNG plants and all of a sudden you'll find that the value of gas for domestic sales is now set by the international value of LNG. They're not going to sell it to you for $3 if it's worth $5, $10 or $20 going into the LNG plant, now are they? That situation has already arisen in WA.

Same with any commodity. You only get it below international pricing if there's a transport bottleneck giving rise to an isolated domestic market. The more LNG plants are built, the more that gets removed.

Now here's the bit of speculation on my part. I note that Russia dominates global gas reserves with Middle East countries coming next. This situation is intensifying with the depletion of EU, US etc reserves.

Now, does someone having an effective monopoly sell their product cheaply? I'm willing to bet that the answer is "no" and that gas ends up going the same way as oil did in the 1970's. With diminishing competition, the Russians etc aren't likely to sell cheap. If that happens and enough LNG plants get approval then Australian producers won't be selling cheap either.

 

[newanimal]

I'm new to using market depth. Buy orders below last price and sell orders above seems to me only half the picture. Anycase, givin that info I see market depth heavily weighted to the buy side. With that added to the picture, I'm putting a buy in at .155. Guess we'll see.

 

[adobee]

Getting a fair bit of interest again following a big retrace could look to push up again with the strength of buyers... I think there are alot of traders on this one though....

 

[Knobby22]

Getting a fair bit of interest again following a big retrace could look to push up again with the strength of buyers... I think there are alot of traders on this one though....

There are some traders but the way the pullback occurred and the solid buying shows that there are plenty of investors also. You need to be a bit of a trader in this stock as it is so volatile.

The next swing should get us near 40c imho.

 

[adobee]

Well I have taken an entry at 18c.. I will be happy to take around 26c if it can push out early next week..

 

[andione1983]

Well I have taken an entry at 18c.. I will be happy to take around 26c if it can push out early next week..

i got in at 25c a couple of weeks ago when this was up 30% or so, so im just hoping to make my money back lol

 

[Hedders]

I got in at a similar amount (23 cents). I know it only climbed 2.5 cents today, but that's a whole lot better than the caning it's had of late! Can anyone see anything promising from the charts?

 

[S73417H]

I got in at a similar amount (23 cents). I know it only climbed 2.5 cents today, but that's a whole lot better than the caning it's had of late! Can anyone see anything promising from the charts?

I too wouldn't mind seeing what some chartists think of this one. Anyone out there have some input?

 

[M34N]

Had CFU on my watch list since they were brought to my attention by a fellow workmate a few months ago. From my analysis, it seems to have found a nice solid base at 15 cents in the past couple weeks, and held on. Friday was a nice up day with some solid volume behind it; looks like to me that it is potentially heading back up towards 25-30c range, so looking for some weakness in the next few days to jump on board. My only worry is it's still in a major downtrend (for the past 2+ years) and yet to breach that, but something is telling me it has potential to take off

3-year and 3-month charts (attached below) tell the story, and the 3 month chart looks pretty bullish IMO, and EMA looks positive.

 

[rhen]

G'Day
Seeing no one else has (oops...just saw M34N...did I take so long!), I'll put my charts up with the understanding:
1. On the charts the 1 is a first stage (for me) buy and the 3 is a warning of a buy on the horizon. The 2 and 4 turn off the buy call...they are not a sell.
2. These are my programmed indicators so treat them as such, as reason to watch for other signs that the share is ready to rise.
3. My second stage analysis is necessary before I decide to buy. My indicators have been reasonably accurate...just wish I could follow more, or have fewer to follow. They are not infallible (goes w/o saying).
4. Had a beautiful call on BCI recently (but, of course, did not buy).

I came in for a second stab at CFU too.

Oh, and please note what Etrade, in the Co. profile says:
"Ceramic Fuel Cells Ltd (CFU) is a company which develops solid oxide fuel cell (SOFC) technology to provide reliable, energy efficient, high quality, and low-emission electricity from widely available natural gas and renewable fuels."
Notice the last 2 words...not just natural gas. Another source of income for our embattled farmers???
Barring overseas' problems intervening, the charts' forecast are positive. But, it takes much more than positive charts to be a winner.

 

[Boyou]

It is encouraging to see that someone is doing charts on this stock ..wasn't too long ago they were copmpletely off the radar.

Thanks M34N AND rhen for posting these.I don't do or follow charts,but take note of any info which leads to understanding.

Crucial to the rapid movement of CFU is a deal with one or more of the utility companies in Europe or Asia.Have no up to date info on the manufacturing plant in Germany,but ,assuming it is on track for production..the Ducks would all be lining up nicely for a surge...if such a deal were locked in.Too bad about the NUON pullout... but that leaves a few other players.

Cheers ,Ya'll

 

[rhen]

I got in at a similar amount (23 cents). I know it only climbed 2.5 cents today, but that's a whole lot better than the caning it's had of late! Can anyone see anything promising from the charts?

The caning was predictable.
When you are feeling uncomfortable about CFU, try this
http://www.brr.com.au/event/58216

It works for me...and that's not beginning to cover all the possibilities of this great little Aussie machine. Anyhow, 2010 should be a big year. Who knows where this goes! (hopefully not stolen).

 

[S73417H]

Thanks for the charting insight guys. Much appreciated. Generally speaking I approach technologies such as these with some skepticism, but it just looks so polished. Time to take a punt I think.