Tokyo Gas has been conducting demonstrations and field tests of on-site PAFC (phosphoric acid fuel cell) power generation plants for about thirty years, since Tokyo Gas and Osaka Gas first participated in the TARGET program launched in the US in 1967. We have mainly operated 50kW, 100kW and 200kW on-site plants at our research institute and our customers' sites, which include hotels, offices, universities, laboratories, factories, district heating and cooling centers (DHC), etc. We have accumulated considerable data and evaluated the performance of PAFC electrical/thermal characteristics, reliability and durability from a composite total of 813,000 hours from more than 40 plants' operation. Under our evaluation of these items, onsite PAFCs have technically attained the commercial level. A remaining hurdle to actually marketing PAFC plants is to reduce the cost. At the same time as we work toward the reduction of several costs related to the plant itself, in areas such as construction, maintenance and overhaul, we