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As the nascent fuel cell market—estimated to be worth more than $10 billion by 2010—charges forward, the mantra of DCH Technology, "Hydrogen is the Future: We Can Sense It," seems ever more clever and right on target.

"These last few years have been tremendously encouraging," said Dave Haberman, DCH Technology chairman and co-founder. "We no longer feel like the lone wolf. Today, it seems like fuel cell technology is on everyone's radar screen."

A manufacturer of hydrogen fuel cells and gas detection systems and safety equipment, DCH Technology, which now publicly trades under the symbol (DCHT), incorporated in 1995. At the time, Haberman said the fledgling company focused solely on developing sensors and safety equipment for industries using hydrogen. Its first product release, the Robust Hydrogen Sensor, and its Thick Film Sensors, now monitor hydrogen at a variety of companies, including Aerospace Corporation, AlliedSignal, Ballard Power Systems, Ford, Northwest Power Systems, Lucent Technologies and NASA.

With the current annual market for hydrogen gas detection equipment estimated at $440 million and growing rapidly, Haberman said DCHT still hopes to become the "de facto safety guy" for these and other companies using hydrogen. Yet in 1998 after coaxing Dr. Mark Daugherty to leave the U.S. Department of Energy's Los Alamos National Laboratory and join DCHT as its chief scientist, Haberman said the company worked with Los Alamos and developed its first PEM Hydrogen Fuel Cell. DCHT currently develops fuel cells from 1 watt (the size of a D-cell battery) to 10,000 watts for electronic equipment, marine vessels, portable power, battery charging, and for use in small businesses and homes.

"Small is beautiful, and that's what we want our products to be—small and simple, not large and complicated," Haberman said. "Don't get me wrong. We applaud the large projects and hope they succeed because we plan to sell them sensors. But when you ask people to make major infrastructure changes, they tend to lose interest."

To help the company develop its fuel cell strategy, DCHT recently hired Stephanie L. Hoffman to serve as vice president and general manager of fuel cell operations. Formerly the Eaton Corporation's director of strategic technology planning, Hoffman said DCHT impressed her with its small-is-beautiful product orientation. "The emphasis on reliability and simplicity of design is distinct," she said shortly after DCHT announced her appointment. "DCHT is well positioned for exceptional growth through its initial portable power focus, which addresses current niche markets."

As DCHT continues to develop strategic partnerships, nurture its fuel cell business, and expand its sensor production plant in Valencia, CA, Hoffman's optimism about the company's position seems to be gathering momentum, with industry analysts predicting that the "lone wolf" could become one of the pack's leaders.

Haberman said DCHT's first big break came in March of this year when it signed a multi-year strategic alliance with AlliedSignal, "a company definitely worthy of DCHT's time and effort." Under that alliance, DCHT plans to integrate its sensors into AlliedSignal products and develop aerospace systems using DCHT technology for applications ranging from active corrosion control and nuclear safety to the development of hydrogen-powered vessels. And, DCHT continues to make some attention-getting announcements.

In May, for example, the U.S. Department of Energy's Hydrogen Program selected DCHT to lead a team of 22 organizations, including AlliedSignal, Pacific Marine and the American Bureau of Shipping, to investigate the possible use of hydrogen in maritime applications. In July, Northwest Power Systems placed an order for a 3 kW fuel cell system. Additional orders are pending the success of the integration and testing of the first system, with the total NPS project valued at $3.5 million. And in November, DCHT received a contract for sensors worth, with options, more that $2.4 million from a major fuel cell manufacturer. The identity of the manufacturer hasn't been disclosed.

According to RAM Capital, the November deal alone signals strong revenue growth for DCHT over the next six to 24 months as "an influx of large orders for its patented hydrogen gas sensors and leak detection systems take off."

"In our opinion, the selection of DCHT hydrogen sensors by this one manufacturer is just the beginning," RAM Capital said in a statement released after the deal's announcement. "We see this as the creation of a de facto standard in the fuel cell industry to use the DCHT hydrogen sensor as the premier embedded safety device for all hydrogen-related fuel cell systems."

In that statement, RAM encouraged the investment community to embrace DCHT and dubbed it a "tremendously under-priced emerging growth company." With current industry leader Ballard Power Systems trading with a market cap of $2 billion, and the recent IPO of Plug Power already trading at $800 million, RAM Capital said DCHT needs to be assigned a sharply higher market cap than its current $17 million. Even at $10 per share, RAM Capital said, DCHT will still only have a $170 million market cap, representing a small fraction of its industry peers.

Currently, DCHT stock trades at $1.35 per share. Still, RAM Capital and other industry analysts feel the company's future can only get brighter. "The growth of the fuel cell industry is anticipated to be as great as the growth of the PC, and DCHT will be there."

Not surprisingly, Haberman wholeheartedly agrees with RAM Capital's assessment. And to ensure its prophecies of a bright future, he said DCHT plans to continue to concentrate on its initial focus—sensors and safety—but also sees areas like distributed generation and selling fuel-cell power back into the electricity grid as potential growth markets. "Hydrogen is the future. We can sense it."