Oct. 31--Danbury-based FuelCell Energy Inc. said it has expanded an existing deal with a South Korean power provider that will use the Connecticut company's hardware to manufacture fuel cell stacks.

The South Korean company, POSCO Power, also closed on its previously announced purchase of $25 million in FuelCell Energy common stock at a purchase price of $3.59 per share.

FuelCell Energy said the additional demand would justify expansion of its Danbury operations.

"We view the partnership with FuelCell Energy as critical to accomplishing our goal to make South Korea a world leader in clean energy technology," said Soung-Sik Cho, chief executive of POSCO Power.

In June, FuelCell Energy said POSCO had ordered $58 million in fuel cell manufacturing equipment.

The new deal, a licensing agreement, includes an upfront license fee of $10 million and an ongoing royalty, initially set at 4.1 percent of revenues generated by POSCO's sales of the fuel cell stack modules.

South Korea has committed 2 percent of its gross national product to clean energy projects -- more than any other developed country.

Fuel cells combine hydrogen and oxygen to create electricity, heat and water. They are promoted for their ability to generate electric power independent of fossil fuel-burning power plants and without creating hazardous byproducts.

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