Mitsubishi Materials Corporation and The Kansai Electric Power Co., Inc. have been jointly developing intermediate-temperature solid oxide fuel cells as stationary power generation units since 2001. High performance LSGMC cells and a unique seal-less cell-stack design enable high efficiency operation at temperatures below 800°C. The 4th generation module with internal manifolds was developed and the electrical efficiency of 54% HHV on DC output was achieved in 2005. The first long-term durability test over 4,200 h of the 4th generation module was ended in 2006 with a voltage degradation rate of about 0.5%/1000h. Scaling-up of the module toward 10kW-class has been successfully done and the electrical efficiency of 50% HHV on DC output was achieved in 2006. The field test of 10kW-class CHP system is scheduled in FY2007.