The U.S. Department of Energy’s (DOE) Office of Fossil Energy’s (FE) National Energy Technology Laboratory (NETL), in partnership with private industries, is leading the development and demonstration of high efficiency solid oxide fuel cells (SOFCs) and fuel cell turbine hybrid power generation systems for near term distributed generation (DG) markets with an emphasis on premium power and high reliability. NETL is partnering with Pacific Northwest National Laboratory (PNNL) in developing new directions in research under the Solid-State Energy Conversion Alliance (SECA) initiative for the development and commercialization of modular, low cost, and fuel flexible SOFC systems. The SECA initiative, through advanced materials, processing and system integration research and development, will bring the fuel cell cost to per kilowatt (kW) for stationary and auxiliary power unit (APU) markets. The President of the U.S. has launched us into a new hydrogen economy. The logic of a hydrogen economy is compelling. The movement to a hydrogen economy will accomplish several strategic goals. The U.S. can use its own domestic resources—solar, wind, hydro, and coal. The U.S. uses 20 percent of the world’s oil but has only 3 percent of resources. Also, the U.S. can reduce green house gas emissions. Clear Skies and Climate Change initiatives aim to reduce carbon dioxide , nitrogen oxides , and sulfur dioxide emissions. SOFCs have no emissions, so they figure significantly in these DOE strategies. In addition, DG—SOFCs, reforming, energy storage—has significant benefit for enhanced security and reliability. The use of fuel cells in cars is expected to bring about the hydrogen economy. However, commercialization of fuel cells is expected to proceed first through portable and stationary applications. This logic says to develop SOFCs for a wide range of stationary and APU applications, initially for conventional fuels, then switch to hydrogen. Like all fuel cells, the SOFC will operate even better on hydrogen than conventional fuels. The SOFC hybrid is a key part of the FutureGen plants. FutureGen is a major new Presidential initiative to produce hydrogen from coal. The highly efficient SOFC hybrid plant will produce electric power and other parts of the plant could produce hydrogen and sequester . The hydrogen produced can be used in fuel cell cars and for SOFC DG applications.