The collaboration will continue after IBM's PC business is transferred to China's Lenovo Group Ltd. in the second quarter.

Sanyo and IBM said they will introduce the power system as early as 2007, when the two companies expect that regulations and rules will have been amended so that use of direct methanol fuel cells becomes easy. For example, rules would be needed to take methanol onboard aircraft.

IBM has been a steady customer for Sanyo's rechargeable batteries for its ThinkPad. Sanyo proposed the latest collaboration, said Mitsuru Honma, president of Sanyo Mobile Energy Company. The two companies developed a hybrid fuel cell system prototype that combines a micro DMFC and a lithium-ion battery.

"As a rechargeable manufacturer, we believe that a fuel cell system should have a rechargeable battery by announcing the hybrid system of a lithium-ion battery with fuel cell," said Honma. "This is not the final form at all. Our target is to supply power anywhere. To realize it, hybrid should be the key technology."

Announcements have so far emphasized fuel cell performance. But fuel cells lack storage capability and sufficient output power for many PC applications, said Honma. "We propose a system that combines a fuel cell's power generation and lithium-ion battery's storage capability. This will replace with the AC power supply and eliminate the need for power lines," he said.

The prototype is a bulky docking bay weighing 2.2 kg that includes a fuel cell and a built-in lithium-ion battery. The docking system measures 270 mm x 282 mm x 16 to 54 mm high. The fuel cell cartridge contains 130 cc of pure methanol, providing a 12-watt output, or up to 72 watts with the built-in battery. DC output voltage is 16 V. One cartridge provides about eight hours of power.

Arimasa Naito, an IBM fellow leading ThinkPad development at IBM's PC research and development facilities in Yamato, Japan, said. "There are still a lot of challenges to use a fuel cell with a notebook PC, such as durability, compactness and safety measures. The Yamato team will work with Sanyo to develop a fuel cell system which is not a mere replacement of present battery packs," he said.

While collaborating with IBM, Sanyo is looking to partner with other PC manufacturers. "We are going to propose this system as a standard power supply system. By making our concept clear, we are expecting that other companies would join us," said Honma.