When investors think of
Plug Power,
they think about hydrogen. The company wants to dominate in hydrogen-based technologies including fuel cells and electrolyzers that split water into hydrogen and oxygen gases using electricity. But investors also soon will have to think about electric- vehicle charging when they consider Plug.
Plug (ticker: PLUG) announced a solution for charging a lot of electric vehicles all at once without stressing the electricity grid. They will use their fuel-cell technology to deliver the juice.
“As EV adoption increases dramatically over the next few years and electricity demand strains the grid, our new high-power fuel cell system will be a game changer for the EV industry,” said Jose Luis Crespo, general manager of applications and gobal accounts for Plug, in a news release. “Customers are approaching Plug for hydrogen power generation options, and we expect this offering to be one of the largest applications for stationary use this year.”
Plugging in, perhaps, 1,000 electric-delivery vans at night is no easy task. It can require a lot of capital and pre-planning between the fleet owner and a local power utility. A Plug system is intended to bypass the utility by providing the electricity with a fuel cell and hydrogen gas.
One of Plug’s proposed configurations includes an 18,000-gallon tank of compressed liquid hydrogen gas and a fuel cell that can simultaneously charge 600 EVs.
The company will be talking about its new system this week at the Advanced Clean Transportation Expo in Anaheim, California.
It’s an interesting solution that the U.S. can use. America needs more EV charging-for passenger cars or fleet operators. The U.S. had about 158,000 charging ports at the end of 2022, according to Bloomberg New Energy Finance. China ended 2022 with about almost 1.8 million ports.
That means there are, very roughly, six battery-electric vehicles per available plug in China. That ratio in the U.S. is roughly12 to 1. Insufficient EV-charging infrastructure can be a barrier to EV adoption.
It’s an interesting solution, but investors were taking the announcement in stride. Plug stock was down 1.8% Monday. The
S&P 500
and
Dow Jones Industrial Average
are up 0.3% and 0.3%, respectively.
Plug shares have fallen about 28% this year, and have declined 59% over the past 12 months. Hydrogen technology, and Plug sales, are expected to grow in the coming year, but rising interest rates and a slowing economy have sapped some investor enthusiasm for richly valued growth stocks.
Plug isn’t expected to be profitable in 2023 or 2024 and shares trade for roughly three times estimated 2024 sales. Sales are expected to grow to about $2.1 billion in 2024, up roughly 60%, compared with 2023 estimates sales of about $1.3 billion. Write to Al Root at [email protected]
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