This paper focuses on the strategy and experience of San Diego Gas and Electric with the development and demonstration of a proof of concept 250-kW internally manifolded heat exchanger (IMHEX (R)) carbonate fuel cell power plant. The plant was installed, commissioned, and operated by San Diego Gas and Electric (SDG&E) in a cogeneration mode at the Naval Air Station (NBS) at Miramar in San Diego. These activities were part of a collaborative effort between SDG&E and M-C Power's Program team (IMHEX (R) Team). The IMHEX (R) Team consists of M-C Power, Bechtel Engineering, Stewart and Stevenson, and the Institute of Gas Technology (IGT). The technical aspects of the plant's commissioning and operation were addressed by my colleague, J. Otahal, in a poster presentation. Our activities in carbonate fuel cell development are unique because of the level of involvement by an investor-owned utility in the development, engineering, installation, operation and maintenance of a fuel cell demonstration plant. The following topics are discussed in this paper: (i) SDG&E's involvement in the development of molten carbonate fuel cell (MCFC) technology; (ii) the active role in engineering and specification of the IMHEX (R) MCFC demonstration plant; (iii) responsibility for installation, commissioning, and operation; (iv) utility role in technology development and application of MCFC in a restructured and competitive environment: (v) summary. Published by Elsevier Science S.A.