Ceres Power Shifts to Natural Gas SOFCs for Stationary Power Markets

Fuel cell technology has become the linchpin of Ceres Power Holdings plc’s new game plan after Phil Caldwell dropped a surprise pivot on 26 September 2025. With AI data centers and digital infrastructure gobbling up power, Ceres is all-in on natural gas–powered solid oxide fuel cells (SOFCs) for stationary power—pressing pause on its green hydrogen dreams until supply chains and hydrogen infrastructure catch up.

A market under pressure

You might not think about data centers often, but they already gulp down about 1% of the world’s electricity—some massive facilities pulling more than 100 MW each. As generative AI and cloud services keep scaling, operators are hunting for on-site power that’s rock-solid reliable, low on carbon and light on cost. Sure, gas turbines and diesel backups can keep the lights on, but they leave a hefty emissions footprint. Enter Ceres’ SOFCs: at over 700 °C, they squeeze out 50–60% electrical efficiency straight from natural gas, trimming CO₂ output by roughly 30% versus old-school thermal plants.

Global forecasts predict the stationary fuel cell technology market exploding from under 2 GW in 2023 to around 22 GW by 2030—driven by industrial decarbonization mandates across Europe, North America and Asia-Pacific. Here in the UK, incentives like the Industrial Decarbonisation Strategy and the Low Carbon Hydrogen Fund are helping cut red tape for clean energy projects.

Doosan scales manufacturing

In July 2025, South Korea’s Doosan started cranking out SOFC modules under license from Ceres. By teaming up with Doosan’s heavy-hitting manufacturing chops, Ceres can push those ceramic stacks, balance-of-plant gear and integration kits out the door fast—first stops: Japan, South Korea and Taiwan. Doosan says the initial batch will shore up both grid-tied and off-grid sites, with production ramping to a few hundred megawatts by 2026.

Their Gumi facility alone is set to churn out about 50 MW of SOFC capacity by December 2025, jumping to 200 MW in 2026. With Doosan’s established supply chain (think ceramics, anodes and interconnects), Ceres’ partners can go from proof-of-concept to commercial roll-out in about 18 months.

Why natural gas now?

SOFCs use a rugged ceramic electrolyte to shuttle oxygen ions from cathode to anode, where they meet the fuel head-on. Once you hit 600 °C+, natural gas internally reforms—no bulky external reformers needed—keeping the system design clean and mean. The perks:

• Efficiency: Over 80% in combined heat and power mode, so you’re not wasting energy.
• Fuel flexibility: Run on methane today and swap to hydrogen down the road.
• Low emissions: NOx and SOx stay within strict environmental limits.

By leaning into natural gas, Ceres sidesteps current hiccups in hydrogen production, storage and transport—while locking in near-term revenue through licensing fees and royalty streams.

Strategic cost management

Take a peek at Ceres’ finances and you see why they made this move. After revenues dipped in early 2025, they kicked off a year-long overhaul to slash operating costs in half. They’re consolidating UK R&D sites, trimming headcount and funneling cash into core SOFC development. Although they’re still in the red, management believes incoming licensing deals with Doosan and others will shore up cash flow and ease default worries.

So far, they’ve cut about 30% of staff and merged two R&D hubs into one powerhouse. That restructuring should save roughly £15 million a year by mid-2026—critical breathing room until those royalty checks start rolling in.

Electrolysers wait in the wings

Ceres isn’t walking away from electrolysers—solid oxide electrolyser cells (SOECs) are very much on their roadmap. Flip the SOFC process around, and you’re splitting steam into hydrogen and oxygen at high temps, with efficiencies north of 80%. But scaling electrolysers hinges on cheaper ceramics and more renewable juice on the grid. As green hydrogen policies tighten in Europe and North America, Ceres plans to license its SOEC designs just like it did with Doosan’s SOFCs.

They’re in late-stage talks with would-be licensees in Germany and the US, aiming for joint development deals to prove SOEC modules at grid-scale. Expect pilot plants up to 10 MW by late 2026—ideally co-located with wind and solar farms for maximum sustainable energy synergy.

Standing against competition

Ceres’ strategy highlights how crowded the stationary power arena is getting: gas turbines, hydrogen fuel cells and battery storage all vying for attention. Siemens and Mitsubishi are pushing turbines with carbon capture; other players are doubling down on PEM cells for quick ramp-ups. SOFCs deliver on durability and fuel flexibility but still wrestle with thermal cycling.

Compared to utility-scale batteries (where capital costs can top $400/kWh), SOFC installations deliver constant baseload power and often lower lifecycle costs when you run them hard. Granted, the initial sticker price for SOFC stacks can outstrip mature turbines, so Ceres is pushing design tweaks and volume-based cost cuts.

Long-term decarbonization outlook

Sure, natural gas-fired SOFCs still emit CO₂, but they offer an immediate emissions cut. Ceres is clear that solid hydrogen infrastructure and green electricity will be non-negotiable for hitting net-zero. In markets where renewables boom and electrolyser costs tumble, they expect licensees to retrofit SOFCs for 100% hydrogen operation.

The UK’s Hydrogen Strategy, targeting 10 GW of low-carbon hydrogen production by 2030, sets a solid policy backdrop for future SOFC and SOEC rolls. Backed by carbon pricing and grid reforms, these hydrogen-ready SOFCs could be the launchpad to fully decarbonized power systems within a decade.

Next milestones

Here’s what we’re watching:

• Doosan cranking out 1 GW of modules by mid-2026.
• Locking in at least two more license agreements across Europe and North America by year-end.
• Demoing a hybrid SOFC-SOEC pilot by Q3 2026 to prove that bidirectional magic.

On the R&D front, Ceres aims to drive ceramic stack costs down by 40% over three years with materials tweaks and automated manufacturing. They’re also cooking up new interconnect coatings to push stack lifetimes past 40,000 hours—a big deal for industrial customers.

What’s on the horizon?

Ceres’ shift raises some big questions for investors and policymakers: Can they scale licensing deals fast enough for surging power needs? Will natural gas SOFCs stack up cost-wise against other low-carbon alternatives? And how quickly will hydrogen-ready infrastructure emerge to realize that zero-emission dream?

As the energy transition intensifies, Ceres Power’s journey shows why flexible technologies are crucial for bridging today’s constraints and tomorrow’s decarbonization goals. Their success—or stumble—could become the blueprint for tech licensor models in the clean energy sector.

About the Company
Ceres Power Holdings plc is a UK-based technology licensor focused on solid oxide fuel cell technology and electrolyser design. Instead of building its own plants, Ceres licenses its IP to industrial partners like Doosan, offering end-to-end services from stack design to full system engineering for large-scale production.