Innovative Business Model Focusing on Rapid Growth
Fuel cell technology is a new technology, and for it to be adopted, a complete energy supply solution (with hydrogen supply furniture has to be established and costs have to be lowered before our innovative technology is accepted by the market. StarPower On Systems Inc. (SOS) recognizes 2 critical elements that are required for success in the market and worldwide adoption.
1. Hydrogen Production: Facilitate the production of hydrogen using clean renewable energy sources such as solar or wind. Another exciting source of hydrogen is artificial photosynthesis, which can produce high quantities of high quality hydrogen with zero waste and zero emissions.
2. Cost: By adopting an “Energy Performance Contract” finance model, we can secure the cost of the fuel cell and the conversion cost.
Our focus is marketing directly on the municipal level, targeting public transportation services such as buses, coaches and taxis. A self-sustaining hydrogen production plant utilizing natural sources makes perfect economical sense. This is more cost effective compared with gasoline powered vehicles without emitting any harmful chemical and greenhouse gas pollutants.
Five major Chinese cities have been approached in the past 30 days and we have already received four legally binding “Letters of Intent” promising that over 20,000 vehicles will be converted to our fuel cell, and 6 trial orders for converted vehicles were immediately made.
At the same time, our business model also stimulates the private automobile sector to start producing fuel cell vehicles as they can rely on the municipal hydrogen supply.
Advanced Finance Model Using “Energy Performance Contract (EPC)”
Application of the EPC finance model - To use the energy cost savings from converting to our fuel cell to pay for the initial cost of conversion over the duration of the contract.
How does EPC work?
It is recognized COST is a major roadblock for the technological innovation to be adopted by the general public. China as a nation has in the past decade invested heavily into, and has become the world's leading installer in, solar and wind power generation. It is a great opportunity to promote the use of fuel cell technology riding the high tide of the solar and wind farm industries.
The EPC model yields the following benefits:
- Consumers who want to make the change to our fuel cell can do so immediately, as the initial cost has already been absorbed.
- Financial institutions are accustomed to financing the EPC model, and they will have excellent agreements laid out with governments as their clients.
- SOS will be able to manufacture all proprietary fuel cells, and allocate part of the profit margin within the EPC as one of the benefit recipients, and establish a long term revenue stream.