Date: Apr 03, 2014 Source: Company Data (
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Whiteboardct.com, a website dedicated to advancing and promoting Connecticut entrepeneurs, has published a lengthy interview with Dr. Trent Molter about his entry to the fuel cell industry, his experience with Proton OnSite, and the founding of Sustainable Innovations.
Trent Molter is the founder and CEO of Sustainable Innovations, a Glastonbury-based startup that is developing cutting-edge clean tech products for hydrogen fuel cells, hydrogen-based batteries, and carbon capture. Prior to founding Sustainable Innovations, Trent was a co-founder of Proton Energy Systems (now Proton OnSite), which went public in 2000. He later earned a doctorate from UConn and is currently Associate Research Professor there. Trent spoke to The Whiteboard about his chance encounter with fuel cell research early in his career and how it set the stage for his later entrepreneurial ventures. He also discusses the particular challenges of developing pioneering, high-tech hardware in a sector that is still fighting for long-term viability.
The Whiteboard: How did you first get involved in hydrogen compression and fuel cell technologies?
Trent: In graduate school I studied chemical engineering and materials science—how materials behave and how can we use them and modify them for our benefit. When I graduated I was fortunate to get a job offer from Hamilton Standard, where I became a materials engineer working on aerospace products. In 1984, a month after I joined, Hamilton bought a GE business unit involving fuel cells. I was a young guy working around a bunch of old-timers who more or less were forced into retirement because of the acquisition. They shared their war stories and dumped all their old files on me. It was a wonderful learning experience.
We were doing a lot of R&D on how hydrogen fuel cells and electrolyzers could be used for submarine life support, for space missions, and for the production of chlorine and other commodity chemicals. Most of this was government-based activity. Then Ballard started commercializing fuel cells for buses and cars, and a group of us realized we could do that too. We approached our management and asked if we could look more closely at these opportunities and think about creating a new business model. They said, "No, we're aerospace-focused and don't belong in that sector." But our little group caught the bug, and we banded together on weekends and at night and generated a business plan. After about two years, we were able to scrape together funding through VC sources, forming Proton Energy Systems. This was in 1996. We were initially focused on building a line of hydrogen generation equipment for commercial applications. We grew the company through venture capital sources and did quite well through several rounds of financing—A, B, and C rounds. We had a successful IPO in September 2000.
What was your role at the company?
My role was to grow the technology and the business opportunities for the company. We developed hydrogen generation equipment for industrial gas applications (including heat-treating of metals), for cooling electric generators, and for fueling fuel-cell vehicles. We also worked on regenerative fuel cells for energy storage applications. But then I left in 2003 to do something bizarre.
And what was that?
I went to get my PhD at UConn. It was something I always wanted to do, and now I felt that I could do it. And it allowed me to do a couple of things that were really important to me. My job in business had been so grueling, and it took me away from my family; now I could spend a little time with my kids before they went off to college. But it had also taken me away from the basics of the technology. At UConn, I had the opportunity to get back into research, focusing on materials science and energy, specifically the effects of contaminants on the membranes of fuel cells. It's an important issue for people trying to commercialize fuel cells for automobiles and other uses, and eventually I received grants from the Department of Energy to do my work. But around 2007, as I was getting ready to defend my thesis, I knew that I needed to think about what was next, and I started putting together the basics of a business plan and writing proposals for the idea of the company that ultimately became Sustainable Innovations. I was approached by two other entities, including a professor at Harvard who was interested in hydrogen-chlorine fuel cells, which very few people have a background in. He had the idea of pulling carbon dioxide out of the air and storing it in the ocean, and needed a hydrogen-chlorine fuel cell to do it. We wrote a proposal for the SBIR program at the National Science Foundation and won. Usually you have a 20% chance of winning on your first shot. All of a sudden, we were in business.
At the same time, we started talking to Fuel Cell Energy in Danbury about compressing hydrogen electrochemically and decided to write a proposal to the Department of Energy to electrochemically compress hydrogen, which would complement their fuel cell product as a sort of add-on. We started talking about what features could benefit their product, wrote a proposal, and won again. We were two for two.
I started looking at our two products and began thinking that we might have the basis for a real business. They were two discrete projects but they had something in common. With the first proposal, we had to hang out a flag and call it a company, but there wasn't a real vision. The vision evolved over time. This was in 2008. That's when my wife kicked me out of the garage because it was too full of our test equipment and other "junk" and we started leasing space nearby, an R&D space in Glastonbury. We kept growing, generating more proposals, and figuring out where the opportunities were.
What products have you developed?
At this point we have three products under development. The first product, H2RENEW™, is an electrochemical device that can take in dirty hydrogen from industrial processes, pluck out the hydrogen, and create pure, pressurized hydrogen, recycling it back to the process or sending it off to storage for industrial use. Our process for pressurizing hydrogen is unique: we use an electrochemical process to remove protons and electrons from one side of a membrane and send them to the other, creating new molecules of pure hydrogen at pressure. This is important in fueling fuel cell vehicles, for instance, where the goal is to operate them at high pressures. We can take any hydrogen source and boost the pressure without any moving parts—it's probably the most efficient way to compress hydrogen in the world.
The second product is the HALOGEN™, which is essentially a scalable battery that can store energy at efficiency levels approaching 80%. The best lead acid batteries typically store at 70%, so that's an important leap. It's also very cost-efficient. Lithium batteries, on the other hand, are very expensive. So this is a very big deal. They'll be used for renewable energy storage or grid-based applications. With this product, we expect we'll need about five years after initial funding to be in production.
Our third product is called the CO2RENEW™, a device based on the architecture of the other two, that can take waste carbon dioxide and convert it into fuels and commodity chemicals. For people and companies concerned with CO2 emissions, if we can take CO2 emissions and turn a societal problem into something valuable and salable, then this could really be a wonderful device. For example, right now, the U.S. imports foreign oil and converts it into polymers to make a wide variety of products. Instead, why don't we use our own waste CO2 to make polymers? We wouldn't have to import foreign oil and we could consume our own emissions and make recyclable products with these polymers. So it's a really cool product and the market is a billion dollars; it blows your mind. There's a tremendous upside but technically a lot of work to do to get there. But we've got the basics down. We expect it'll take another five to ten years to fully develop.
That seems like a long time.
Hardware time marches along more slowly than internet time—it takes a long time to develop hardware. We're always looking out for competitors and other good ideas, but we have a good, very entrepreneurial group; we can bob and weave quickly; and we're always developing new ideas ourselves and with partners. If there's a roadblock, we'll have something in our back pocket to work around or replace an idea. That said, it requires constant effort.
Have you released a commercial product?
We haven't released a commercial product yet. We've developed the technology base for the three products, and we're in the process of starting to raise equity funds for commercial development and deployment. To date, we've relied on government funding, and we've been very successful with that. Actually, between 50% and 100% of our development revenues each year have come from government programs, along with some private grants and contracts. Now we're starting to look for equity sources and close on our first round of financing this year. I'm not convinced it'll be easy, but I've done it before and had success with my last company. I have a track record and understand the hurdles.
Who will your customers be?
There are many possible customers: for example, utility companies, shopping center owners, or companies trying to green their businesses. We talked with one large corporation that had a corporate edict to install solar farms at all of their manufacturing plants. They needed an energy storage solution but decided not to use lead batteries. Those are the kinds of customers who might turn to us.
How big a team are you?
We have a team of 19 at the company, up from eight a year ago. Members of our team have a variety of backgrounds—academic and industrial, 30 years' experience or right out of school. I credit a lot of our capabilities to the mix of people we have, that combination of experience and energy. Some have been through the wars and some haven't, but sometimes it takes the ones who haven't to push the ones who have—and vice-versa.
What has it been like for you as a founder?
From my point of view, even though you have your team and strategic partners, it can be lonely. I've talked with other CEOs about this too. When you're leading a company, you need other people who you can relate to who are going through the same sorts of issues, who you can share problems with, even if it's just to chew the fat for a while and lament over the latest whatever. It's important to have such a supporting ecosystem.
Do you have that?
Yes, I have several people I can talk to and relate to, but it's an informal thing. I know there are more formal things set up—this state is dotted with those things, but it's not always convenient. It would be nice if there were more venues for that to occur.
I imagine the success of your company will depend, to some extent, on the success of the clean tech sector as a whole. What's your outlook for the sector?
As a sector, we need an example—one, two, or three companies that go out and become very successful, a beam of light that others can follow. Years ago, when the clean tech sector took off, it was Ballard, then Plug Power, then others. We had a lot of success at Proton with our financing as soon as Plug Power went public. So we need the conditions to be right for at least one company to become successful, and others will soon follow. But there are so many factors and they're so intertwined.
What I see happening now, though, which is different and new, is that the deployment of fuel cell vehicles is speeding up and becoming more rapid; so fuel cells in and of themselves are becoming more of a commercial reality. The general public is more accepting. When I was young and told my friends that I was working on fuel cells, they would wrinkle their nose, look at me funny and say, What the heck are they?! But now a lot of people have heard of them, and automakers are more willing to take the risk of deploying commercial fuel cell products. I see that as a huge advancement. Those are some of the key points that will help us move a giant step forward.
