In April 2000 Siemens Westinghouse started work under a co-operation agreement with Shell International to develop and demonstrate a natural gas fired 0.25 MW solid oxide fuel cell (SOFC) modified to enable capture of carbon dioxide. The basic principles of this development and initial plans for the demonstration, which is due to start up at a Norwegian location in 2003, have been presented in environmental and fuel cell forums during 1999/2000. This paper reviews the latest technical progress with this development and discusses the large potential market for stationary power generation using SOFCs with CO2 capturing capability. C, 2002 Elsevier Science B.V. All rights reserved.