FuelCell Energy, ex-partner settle dispute

DANBURY — FuelCell Energy has announced a settlement with a former South Korean business partner in a dispute that dates back to 2015.

Terms of the settlement between the Danbury hydrogen fuel cell manufacturer and POSCO Energy Co. Ltd. also cover a POSCO subsidiary, Korea Fuel Cell Co., according to FuelCell Energy

POSCO Energy officials weren’t immediately available for comment on Monday regarding the settlement agreement, The agreement put an end to a legal battle which began in June 2020, according to Jason Few, FuelCell Energy’s president, chief executive officer and chief commercial officer.

Few said FuelCell Energy filed a $200 million lawsuit POSCO Energy that was initiated shortly after the American company sued its business partner for breaching a contract the two businesses signed in 2005. POSCO responded by filing an $800 million lawsuit of its own in October 2020, he said.

Few said the settlement is a recognition of “challenges the lawsuits created in market.”

“Potential clients were reluctant to do business because of the uncertainty that the matter before the courts created,” he said.

As a result of the settlement, POSCO can no longer market FuelCell’s technology to new customers, but will be allowed to continue to service customers it acquired when its contract with the Connecticut company was still in place.

The partnership between the two companies, which began in 2007, gave POSCO the exclusive rights to marketing, manufacturing and servicing FuelCell Energy’s propietary technology in South Korea and other Southeast Asian countries, according to Few. At that time, POSCO Energy invested $29 million in FuelCell Energy to secure the licensing rights for molten carbonate fuel cell technologies in South Korea.

POSCO Energy later invested an additional $55 million in FuelCell Energy, officials with the South Korean said in a press release.

But eight years after the two companies entered into their partnership, POSCO Energy decided “they no longer wanted to be in the (fuel cell)business,” Few said.

Now that POSCO Energy no longer manufactures fuel cells for the American company, that translates into more business for FuelCell Energy, he said.

South Korea is one of the world’s most robust markets for hydrogen fuel cells, according to Few.

It is also home to the world’s largest hydrogen fuel cell park, Gyeonggi Green Energy. The hydrogen fuel cells in the energy park generate 59 megawatts of electricity.

In addition to its Danbury headquarters, FuelCell Energy has a manufacturing facility in Torrington.