For 25 years, Plug Power (PLUG) has quietly nudged the U.S. towards hydrogen fuel cell technology.
Now, its stars are starting to line up.
The hydrogen fuel company announced a string of new partnerships and a major acquisition at its annual symposium Thursday, riding on the momentum of a global push to accelerate the adoption of clean energy.
Driving the initiatives is a larger push by the company to churn out 500 tons per day of liquid green hydrogen in the U.S. by 2025 and establish 13 green hydrogen plants by the end of 2025.
“We use more hydrogen than anyone else in the world for transportation. And this is really just an extension of our vision,” Plug Power CEO Andy Marsh told Yahoo Finance Live on Thursday.
That vision includes harnessing hydrogen to power airplanes and vehicles. The company announced a partnership with Airbus ahead of the symposium, to study the use of so-called green hydrogen, produced with renewable energy sources, in airports and aircraft. Marsh said the company would look to fuel at least one airport utilizing its fuel cell technology over “the coming years,” though he admitted wide-scale use in planes is still long-term.
Airbus has previously set a goal of bringing zero-emission planes to market by 2035.
Plug Power is already working with Los Angeles-based startup Universal Hydrogen to convert regional jets to clean energy. Marsh said that is on track to conduct test flights by the end of next year.
“We’re converting de Havilland aircraft to four regional planes for hydrogen. So, it can be done,” Marsh said. “The cycle for airplanes is not overnight, but Universal Hydrogen has come up with a really cool conversion kit that will really start the journey to make hydrogen aircraft, so we’re really excited.”
A key ingredient for a zero-carbon world
Hydrogen is expected to play a key role in the transition to a zero-carbon future, as countries scramble to cut harmful greenhouse gas emissions to stave off the worst effects of climate change. Green hydrogen is particularly promising, because it is produced with renewable energy like solar and wind. But the scale and cost of the fuel has slowed adoption. Marsh said renewable electricity costs would need to be in the range of three cents a kilowatt hour, in order for hydrogen to be competitive with natural gas. Electrolyzers, which split hydrogen from water, would also need to be deployed on a larger scale to bring prices down.
“We found that every time you double the number of units in the field, costs come down 25%, and we’re looking to deploy over 40 gigawatts by 2030,” Marsh said. “As this technology becomes more and more mature, just like solar and wind, you’re going to see the cost of capital for these big projects come down.”
In the absence of large-scale deployment, Plug Power’s technology has largely been limited to use in vehicles.
On Thursday, the company unveiled a prototype for its fuel cell-powered van, HyVia, developed in partnership with the Renault Group. It also announced the acquisition of Applied Cryo Technologies (ACT), a technology and equipment provider for the transportation and distribution of liquified hydrogen.
Plug Power also established long-term guidance of $3 billion in annual sales by 2025, with 65% growth expected in the next year alone.
It may get some extra help from Congress. The proposed bipartisan infrastructure bill calls for an $8 billion investment to establish at least four regional clean hydrogen hubs. It also sets aside $1 billion in grants to improve electrolyzers for efficiency and cost.
“It’s very, very competitive. Those sort of bills and extension of the investment tax credit, like solar and wind had, will also really help this market accelerate for the U.S. and create lots and lots of jobs in this country,” Marsh said.
Akiko Fujita is an anchor and reporter for Yahoo Finance. Follow her on Twitter @AkikoFujita
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