PITTSBURGH (TNS) — The nation’s largest natural gas producer is putting its money where its mouth is — into the “energy transition” — and into trying to create more demand for the fuel found in shale formations like those that stretch across Pennsylvania, Ohio and West Virginia.
Pittsburgh natural gas firm EQT Corp. led the financing round in which Watt Fuel Cell, a manufacturer of solid oxide fuel cells near Mount Pleasant, recently raised $67 million.
While most residential consumers might not be familiar with fuel cells or how they operate, Watt has been testing their use in powering homes in the region. If successful, that option could be offered to customers of Peoples Natural Gas in the not-too-distant future.
Natural gas companies in the Pittsburgh region have long acknowledged that in order to survive they must not only make gas available but be actively involved in creating the demand for it.
Fuel cells — which don’t burn natural gas but use it in a chemical reaction that produces electricity — are both a way to expand the customer base for the fuel and decrease the downstream emissions footprint associated with it. Emissions from gas drilling, fracking, transportation and processing are not part of that calculation.
”Natural gas is not ‘big oil,’” EQT wrote in its sustainability report last year, expecting that increased demand for hydrogen and fuel cells will boost its profile. The company has been aggressive in developing new markets for natural gas and in pitting itself against oil and coal in environmental attributes — natural gas emits half the greenhouse emissions of coal when burned.
”Natural gas needs a leader that can compete for capital and investments and help guide the energy transition to ensure that all avenues of decarbonization are diligently pursued,” EQT’s sustainability report said.
For Pittsburgh-based EQT, the money for the investment in Watt came from a $75 million fund the company established last year to invest in decarbonization efforts.
The company’s CEO, Toby Rice, is now on the board of Watt Fuel Cell.
There, he joins another Pittsburgh power broker, Morgan O’Brien, Watt’s chairman of the board and former CEO of the North Shore utility Peoples Natural Gas.
It was Mr. O’Brien who forged a partnership with Watt years ago, which Watt’s founder Caine Finnerty told the Post-Gazette in 2018 would allow his company to “leap frog” a few years of development and commercialization by heading into the utility market.
Before that, Mr. Finnerty was appealing directly to consumers and RV owners to swap their diesel generators for his company’s products.
For about a year, Watt has been testing fuel cells at the homes of three Peoples’ customers in Westmoreland County. There, the fuel cells are fed natural gas from a Peoples’ distribution line and convert it into electricity for the home. A push to offer this service to Peoples’ residential consumers will begin later this year, Peoples’ spokesman Barry Kukovich said.
Watt launched operations in the Pittsburgh region, at the Mount Pleasant Glass Center, when it acquired Pittsburgh Electric Engines Inc. in 2014. Before that, it was headquartered on Long Island, New York.
Watt’s CEO Rich Romer said the company’s product is now in “final beta testing” and expects a commercial rollout in the Pittsburgh region to begin over the next year.
With this latest round of funding, Watt said it will use some of the money to develop larger fuel cells for industrial clients.
The new investment is yet another pairing from a group of companies advancing efforts to develop a hydrogen hub in the Pittsburgh region while increasing demand for natural gas.
The consortium, called the “ Regional Decarbonization Alliance,” includes EQT, U.S. Steel, Shell Polymers, Mitsubishi Power, Norway-based Equinor, GE Gas Power, and Marathon Petroleum Corp.
