Plug Power, the hydrogen producer and electrolyzer maker, is taking steps to develop a vertically integrated green hydrogen ecosystem while improving its finances.

The New York-headquartered company on Jan. 27 said it landed $30 million by transferring investment tax credits from its hydrogen storage and liquefaction facility in Woodbine, Georgia, to an unnamed investor.

It was Plug’s first time to utilize transferability rules under the Inflation Reduction Act, which help to offset some of the company’s investment in hydrogen plants.

The transfer came about a week after Plug Power closed a $1.66 billion loan guarantee from the U.S. Department of Energy’s (DOE) Loan Programs Office. The financing will go toward the construction of up to six hydrogen production and liquefaction projects in the U.S.

The milestones were marked as the company moved forward with hydrogen projects in other parts of the world. These included plans to provide a 3-gigawatt (GW) electrolyzer system for Allied Green Ammonia in Australia and to supply  electrolyzers for BP and partner Iberdrola’s for green hydrogen project in Spain.

Key to building an integrated green hydrogen ecosystem are customers, according to Plug Power CEO Andy Marsh.

However, hydrogen players are facing some headwinds in the U.S. in the pursuit to scale as the Trump administration rolls out a new energy agenda. Despite the environmental benefits of the clean fuel, uncertainty remains around demand, production costs and federal incentives that make projects economically viable.

Marsh recently spoke with Velda Addison, senior editor of energy transition for Hart Energy, about the business and its future in the U.S. and abroad.

[Editor’s note: This interview has been edited for clarity, length and style.]

Velda Addison (VA): What are Plug Power's plans to scale its hydrogen production business and how important is this loan to those plans?

Andy Marsh (AM): The loan is important. The first project is in Graham, Texas, which is about 100 miles west of Fort Worth, in wind country. We’re going to build a 45-ton liquid hydrogen plant in Graham. We already have a very, very low cost PPA [power purchase agreement] from NextEra for a wind farm, which we arranged with them to build. We have 310 megawatts of power to produce the green hydrogen and … the price of electricity is under $0.03. That’s extremely helpful in making sure hydrogen from green energy is competitive with hydrogen from fossil fuels.

Plug Power CEO Andy Marsh
Plug Power CEO Andy Marsh (Source: Plug Power)

Plug is the biggest user in the world, bigger than NASA or all the space industry, of liquid hydrogen. Today we buy much of that hydrogen at a high price. By being able to build our own facility, it actually allows us to serve our customers like Walmart and Amazon and others with green hydrogen produced at lower costs than were able to provide them today. … The company’s been here for 25 years. ...We’ve built the first commercial markets of hydrogen fuel cells. One of the [challenging] things of our existence has been associated with how we get hydrogen costs competitive. We run two plants already—about to run a third plant. So, this really allows us to be energy independent. It allows us to build out our business, the fuel cell business as well as our hydrogen business, even further.

VA: What do you think the new administration means for the pace of development of lower emissions hydrogen, electrolytic hydrogen in particular?

AM: The U.S. wants to be the leader in energy for a long, long time. And if you look at the world’s demand for green energy, it’s going to be independent of what governments want or not. There is a huge market opportunity for exporting green ammonia, green methanol, which is based on the feedstock of green hydrogen. I think that when you take a step back and look: the administration, with people like Doug Burgum being the energy czar, has smart energy people. They’re going to want to make sure that the U.S. continues our dominance for the long term.

Also, when you think about electrolytic hydrogen, it’s a question of whether one thinks we should be in this global competition with China or not. China, at the moment, has been building up its capacity in electrolyzers and the ability to provide electrolytic hydrogen. Many of our allies like South Korea and Japan want hydrogen from green sources. So, I think it’s a real fundamental. I think the Trump administration is business oriented, export oriented and energy oriented. And I think what we do with green hydrogen checks all those boxes, and plus we make it in the United States, which I think is really important to this administration and I think to both parties.

VA: What do you make of the final guidance for the 45V [hydrogen tax credit]?

AM: I was the chairman of the Fuel Cell and Hydrogen Energy Association during the development of the congressional rules and the law. So, I’ve been very familiar with it for way too many years, and I think that guidance is better. … Guidance that gets a lot of attention is 45V, which is the production tax credit and we think it’s much better. It’s good for us, with nuclear power and it certainly helps with states that have renewable energy standards. But quite honestly, it incorporates concepts like the three pillars, which was never part of congressional intent. We’re hoping the Trump administration relooks at it and thinks about aligning it with what congressional intent really was. If you really think about the Loper decision overturning Chevron, I think that the three pillars and aspects of the regulations are really on pretty weak ground. Look, it’s better. It’s usable. I don’t love it, but it is an improvement.

Another one that is really important to the fuel cell portion of our business is 48E [clean electricity investment tax credit]. It actually calls out usage of electrolytic hydrogen for fuel cells to be able to continue to take a 30% tax credit. We think that’s a real positive, and we’re really pleased that was added to the net-zero 48E tax credit.

VA: Let’s talk a little bit about the hydrogen hubs. Do you think that the hubs will get the rest of the federal funding they need to move forward with those plans?

AM: We are involved with every one [of the seven hydrogen hubs]. … I think some of the hubs won’t last. …I think the hub focused in southeastern Texas will survive. … I think a couple of the other ones—the upper Northwest—probably aren’t on as strong grounds. I think the hubs are nice.

We’re building up hydrogen hubs ourselves when you think about our site in Georgia, our site in Louisiana, our site in Tennessee and what we’re going to do with Texas. I always felt we were moving faster than the federal government program anyway. I hope they continue. I’d love to sell into the hubs as we’ve been doing, but I don’t think it’s make or break for Plug. And look, I think the rollout has been really, really slow, and that hasn’t been beneficial for the hubs.

VA: How would you characterize the hydrogen sector today in the U.S. compared to other parts of the world where you operate?

AM: Most of my deployments the next two years will be outside the United States. I think that Europe and Australia are markets which are expanding faster and for different reasons. Australia is really looking at it as an export market for green ammonia and green methanol. We had a rather large announcement with a green ammonia company for 3 gigawatts of electrolyzers. You see aggressive action in places like India to support demand for green ammonia … [and] in Japan and South Korea as they look to meet their energy goals.

… I think Europe is more for meeting their climate goals as well as how to become more energy independent. We have a big [project], for example, with Iberdrola and BP in Spain. We have another project with Galp, the largest refinery in Portugal. That’s where the big deployments are going to happen.

In the U.S., there are some really interesting projects and hopefully, the clarity on the PTC [production tax credit] opens some of these up. But I think most of our work will be outside the United States. As I mentioned before, to remain competitive we’re going to have to be able to produce these fuels, this energy, here in the United States to continue to be an exporter of energy.

VA: What are some of the other challenges the industry is facing besides the sourcing and pricing related to green hydrogen?

AM: For the growth of the industry, so much of it’s actually associated with how you finance new technologies … having equity partners come in like you do with solar and wind. New technology that hasn’t really been done before is tough to finance. The DOE loan gives us an opportunity to do that, and we’ll bring in an equity partner. So, it starts looking like a solar project that we can repeat over and over and over again. That’s really what we’re trying to accomplish more than anything else.

VA: Will you speak a little bit more about the demand for your products and services today? Where are you seeing the greatest demand and how do you think that might change in the future?

AM: I’m using about 60 tons of hydrogen per day and we would expect that to grow 20% to 30% each year. The demand is with business customers who are primarily either using our stationary products, which provide either continuous power to the grid or continuous power to electric devices or for our material handling customers. That’s where our demand for the plant in Georgia is today. But I think the bigger opportunity for our electrolyzer business is more associated with where it’s easy to substitute. Galp [for example] is using gray hydrogen today; it will be moving to green hydrogen, mixing green hydrogen in, by the end of this year. Markets like refining, ammonia, methanol where you can easily substitute green for gray—in Europe, there are huge penalties if they don’t migrate to green—are really the biggest opportunities because you don’t have to change anything else in your value chain.

Beyond that, if you’re thinking about chemical processes like green steel using DRI [direct reduced iron] processes, hydrogen is the only thing that can burn at high temperatures to support it. … Ultimately, we think the biggest market is actually utilities supporting renewable grids for long-term storage, where Plug’s electrolyzer products and stationary products are a natural fit. We’re doing a project today, which I’m going to call a first-generation microcell project, with a company called Energy Vault in California, where there’ll be a ribbon cutting at the end of the month. That’s where I see [hydrogen] growing.

VA: Are there any other messages you want to share with readers of this article?

AM: I think it’s important to understand that hydrogen is part of the world’s energy of the future, and the U.S. is uniquely positioned with our solar and wind. We got a lot of sun, we got a lot of wind. We should be the leading exporter of hydrogen and derivatives of hydrogen to support the world’s energy needs. If we don’t do it, somebody else is going to do it. But hey, I’m in America, and I want us to do it.