PricewaterhouseCoopers’ third annual fuel cell report was released today, and to nobody’s surprise most of the industry remains in R&D stage. Not particularly encouraging is that collective revenues slipped last year — down 4 per cent to $234 million (U.S.) from $244 million a year ago — while net losses climbed to $465 million from $387 million.

Personally, what I find most discouraging about this report is that Canada’s presence among this publicly traded group is slowly eroding. In 2002 63 per cent of the company’s studied by PwC were Canadian, dropping to 48 per cent in 2003 and now 40 per cent in 2004. The Top 5 companies measured by revenues also have a weaker Canadian persence this year. That all said, if you only count the top 10 revenue generators Canadian companies still grab 60 per cent of the pie.

If you’d like to do your own year-by-year comparisons you can get all three reports here. Vancouver-based Ballard Power, which if you ask me is still struggling to define itself, has remained the top company measured by revenues over the past three years, which isn’t saying much. Actually, Ballard alone represented 35 per cent of the group’s overall revenues last year.

Keep in mind that these are only publicly traded companies, which PwC estimates only represent about one third of the industry. You should also keep in mind that much of the really cool and promising work is being done by private companies, particularly in the direct-methanol fuel cell space.

Among other findings:

– 13 of the 20 companies, or 65 per cent, in the survey focused on proton exchange membrane technology.

– Distributed Energy Systems, the parent company of Proton Energy and Northern Power Systems, saw its revenues jump 450 per cent to $22 million last year, making it the fastest growing company in the group.

– Somewhat encouraging is that employment only fell by 2 per cent to 2,789 people last year.

“The 2004 financial results for the fuel cell sector reflect the realities of bringing complex new technologies to the commerical marketplace — it takes a great deal of time and money,” says John Webster, who heads PwC’s fuel cell practice. “However, the drivers for fuel cells, such as air quality, climate change and energy seurity, are stronger than ever.”

As I’ve said before, I’m all for certain types of fuel-cell technologies and applications, but I’m sympathetic to investors who, after years of promises, are getting impatient — moreso as they see hybrid technology and other innovations make greater headway towards commercialization.

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