Plug Power is expanding cooperation: This is how it could continue for the Plug Power share

• Plug Power announces cooperations
• US infrastructure package supported
• Big plans for the future

Sustainability trend reaches stock exchanges

At present, the topic of environmental protection is often the subject of public debate. No wonder, then, that sustainability has now also reached the stock market. In the energy sector in particular, there are some companies that have designed their business to be climate-friendly. This also includes the US hydrogen giant Plug Power. Based in Latham, New York, the group is the “leading provider of clean hydrogen and zero-emission fuel cell solutions that are both cost-effective and reliable.”

Joint venture with Acciona to expand hydrogen business in Spain and Portugal

Plug Power has repeatedly secured its pioneering role in the industry with numerous cooperations and takeovers. This includes a joint venture with the Spanish energy company Acciona, which was founded in November under the name “AccionaPlug”. The aim of the joint project is to provide green hydrogen for the Spanish and Portuguese markets, as the companies explained in a press release. As part of the cooperation, business customers will also be able to use AccionaPlugs storage, transport and delivery services in the future. Initially, however, the additional services will be limited to the industrial and metal sectors. “AccionaPlug aims to have hydrogen production plants located directly at industrial customers, as well as stand-alone plants that produce hydrogen for regional distribution,” the company says. “The first plants are expected to go into operation in 2023.”

Acquisition of Dutch Frames Group

The following month, Plug Power also completed the acquisition of the Dutch Frames Group. The aim is not only to bring new experts into the company, but also to draw on Frames’ experience in the areas of engineering, processes and system integration – and thus contribute to producing more than 1,000 tons of green hydrogen per day by 2028.

South Korea is also an expansion target

In addition, Plug Power is expanding its involvement in the South Korean market. A joint venture was also established there last year. In cooperation with the energy company SK E&S, which belongs to the South Korean SK Group, they want to promote the use of hydrogen as an alternative energy source in Asian markets, according to an announcement. To this end, hydrogen fuel cell systems, hydrogen filling stations, electrolyzers and green hydrogen are to find their way onto the Korean and other Asian markets. The SK Group already invested 1.6 billion US dollars in Plug Power at the beginning of 2021, and the cooperation between the two groups has now been further intensified through the joint venture.

Delivery and logistics agreement with Certarus

But Plug Power is also making a name for itself on its home continent with cooperations. In December, for example, the hydrogen giant announced a supply and logistics agreement with Canadian natural gas transport company Certarus, which should accelerate the spread of hydrogen as a fuel. “The companies will use their combined expertise in hydrogen production, mobile power distribution and related technologies to improve North America’s supply chain, helping make hydrogen fuel an affordable and convenient option for companies looking to reduce carbon emissions and want to achieve ESG goals in various industries,” says a statement on the collaboration.

US infrastructure measures support Plug Power business

In the home market, Plug Power should also benefit from the friendly hydrogen policy under US President Joe Biden, as business journalist Larry Ramer predicts in a text article on “InvestorPlace”. The infrastructure package worth a total of 1.2 trillion US dollars, which was passed in November, should – in addition to the expansion of traffic, the Internet network and the water supply – also include the expansion of the electricity network, as reported by the German Press Agency. According to the National Law Review, $8 billion of this will go towards developing at least four green hydrogen hubs in the United States.

Plug Power expects high margins for fuel

And the group also has a lot planned for the future: “We expect that fuel margins will break even by 2023 as we continue to work with strategic suppliers and several green hydrogen plants will be put into operation,” said the company As part of the balance sheet presentation for the third quarter of 2021. “In addition, we will continue to expand our logistics capacities to better manage the delivery of hydrogen to our customers, which should lead to a significant improvement in fuel efficiency.” The fuel business should then be profitable from 2024, and the ongoing expansion of the hydrogen network also suggests further upside potential.

This is how the Plug Power share moves

The shares of the hydrogen giant, on the other hand, are not being driven by the numerous partnerships and optimistic business expectations. Since the beginning of the year, the NASDAQ-listed Plug Power paper has lost 12.83 percent. The bills were last traded at $22.90 (closing price on February 1, 2021).

Ramer gives a buy recommendation

However, Ramer is not deterred by this. Due to the positive outlook for the electrolysers and green hydrogen business areas, he expects the Plug Power share to go up significantly soon. “Plug Power’s new deals and partnerships, as well as increased government support for hydrogen, will significantly improve the company’s long-term financial results,” the journalist said in his essay. “Meanwhile, the new businesses are already set for rapid growth, while margins are likely to improve significantly.” Ramer recommends investors who are looking for long-term investments to buy the share certificate.

Competitors are also storming into the hydrogen market

It remains to be seen whether Ramer will be right in his assessment. Because even if Plug Power can benefit from a market environment that focuses on environmentally friendly energy sources, more and more competitors are flooding into the market and making a name for themselves with partnerships. Only recently, for example, the German materials manufacturer Covestro announced that it wanted to purchase green hydrogen from the Australian company Fortescue Future Industries.

Editorial office finanzen.net

Image sources: Plug Power Inc.