Amid the rapid growth in AIDC demand, the U.S. power grid faces increasing shortages, driving the Onsite Power market. Solid Oxide Fuel Cells (SOFCs) offer advantages such as sufficient capacity, rapid deployment, compact footprint, and high power density. Compared to gas turbines from major suppliers like GEV and Siemens Energy, which face prolonged delivery cycles due to capacity constraints, SOFCs effectively address pain points for AIDC developers. Leading players like Bloom Energy have already secured orders with downstream giants such as Equinix and Oracle, signaling strong medium-to-long-term growth potential for the SOFC market. Investors are advised to focus on core SOFC materials and structural components.
**Key Insights from Guosheng Securities:** 1. **U.S. Power Grid Struggles Amid Surging AIDC Demand** The U.S. Department of Energy projects data center power demand to grow 2–3x by 2028, reaching 325–580TWh and accounting for 12% of total U.S. electricity consumption (up from 6.7%). Decades of stagnant demand have left utilities unprepared for this surge. In high-density regions like PJM, local grids are nearing capacity limits. For instance, data centers near Nvidia’s headquarters remain vacant awaiting power supply. Aging infrastructure and lengthy approval processes further delay new AIDC deployments, pushing developers toward Onsite Power solutions. Bloom Energy estimates it would take 80 years for the U.S. grid to meet the next decade’s demand at current construction rates. By 2030, Onsite Power’s share in data centers is expected to jump from 13% (April 2024) to 30%, with global projects already totaling 8.7GW.
2. **SOFC Emerges as a Leading Onsite Power Solution** Onsite Power—including SOFCs, gas turbines, and Small Modular Reactors (SMRs)—has shifted from backup to primary power sources. While SMRs remain immature and gas turbines face delivery bottlenecks, SOFCs stand out for their scalability and efficiency. Their rapid deployment and high power density make them ideal for AIDC developers. Partnerships between industry leaders like Bloom Energy and major clients (e.g., Equinix, Oracle) underscore SOFC’s growth trajectory.
3. **Materials: The Core Barrier in SOFC Adoption** SOFC units consist of cathodes, electrolytes, anodes, and interconnects, with stacks forming the functional system. Stack costs account for 65% of total SOFC expenses, with electrolytes and electrodes each contributing 25–30%. The structural support—critical for mechanical stability, gas diffusion, and current collection—determines operating temperature, durability, and cost. Current industrial production relies on ceramic-based electrolyte supports (e.g., yttria-stabilized zirconia). Bloom Energy’s fifth-gen SOFCs achieve 0.7W/cm² power density, 30-minute startup times, and 80,000-hour lifespans, offering cost-effective solutions for data centers.
**Key Players:** - Global: Bloom Energy (BE.US) - Domestic: WEICHAI POWER (02338.HK), Sanyou Corp (300408.SZ), OneStone (688733.SH), Zhongzi Technology (688737.SH), Foran Energy (002911.SZ).
**Risks:** Lower-than-expected AI demand, technological shifts, and inadequate subsidies.
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