A company that touts its ability to produce hydrogen as fuel for vehicles and power generation said this week it has opened its South Georgia factory.
Plug Power, which announced its factory in Woodbine in coastal Camden County in 2021, said its facility is designed to produce 15 tons of liquid hydrogen per day and ranks as the biggest plant of its kind in the country. Hydrogen has been touted as a clean alternative to fossil fuels, but its commercial viability to date is still in question.
The hydrogen from the Woodbine plant will be used in fuel cells for things like forklifts and automobiles, and will be delivered to Plug Power’s customers in the region, including Amazon and Walmart.
The opening is a milestone for Plug Power, which has seen its stock price tank amid uncertainty over federal incentives for hydrogen production. The U.S. Treasury issued draft guidance in December for claiming clean hydrogen tax breaks that was more narrow than many in the industry were hoping for.
Last year, the company issued what’s known as a “going concern notice,” raising doubts about its ability to remain in business long-term.
But on Tuesday, Plug Power announced it had negotiated a $1.6 billion loan facility with the Department of Energy. Midday on Wednesday, Plug Power shares were trading for less than $4 per share, up from a low Jan. 18 of $2.42. Still, the company’s shares are down more than 90% since January 2021.
Georgia has seen a surge of green energy, electric vehicle and EV supply chain announcements in recent years. Since 2020, the state has attracted more than $25 billion in promised EV investments with a combined 29,000 jobs.
Last year, Hyundai Motor Group announced plans to develop a hydrogen highway of fueling centers for fuel-cell powered tractor trailers that would serve the Korean automaker’s future $7.6 billion EV plant in Bryan County. Hyundai also has signed a research and development pact with Georgia Tech related to hydrogen-powered vehicles and EVs.
Hydrogen has shown great potential as an alternative to climate-damaging fossil fuels, particularly in trucking and other hard-to-decarbonize parts of the global economy. While it is the most abundant element in the universe, and its only byproduct when burned is water, hydrogen rarely exists on its own on Earth.
For now, the process of producing hydrogen that can be used as fuel is costly and requires a lot of energy, energy that must come from other renewables like solar or wind to be considered truly green.
Plug Power’s Woodbine facility buys power from a local electric membership corporation and is connected to the grid, which is powered by an energy mix that includes fossil fuels. The company says its hydrogen counts as “green” because it buys renewable energy credits for every unit of electricity used to produce hydrogen.
Sanjay Shrestha, Plug power’s chief strategy officer, said with the cost of renewable energy coming down, so should the cost of green hydrogen.
“I think we’re really in that interesting crossover point where green hydrogen is becoming more and more economical,” he said. “Green hydrogen is really becoming the source that can actually support a lot of different application demand coming from a variety of different industries.”
Tim Lieuwen, the executive director of Georgia Tech’s Strategic Energy Institute, said hydrogen is moving out of the experimental phase to pilot and demonstration projects, but there is a lot of ground to cover before it can be deployed on a large scale in the U.S. Countries in Asia and Europe are pursuing it more aggressively, he said.
“Is this thing going to go big time live next year? No, but we’re seeing some very critical steps toward real insertion of hydrogen into the economy,” Lieuwen said.
Lieuwen was part of a bipartisan group of Georgians who unsuccessfully applied for part of the $8 billion the Biden administration has set aside for hydrogen hubs across the country. Although the Southeast did not get one of those hubs, the infrastructure that is slated to be built as part of the initiative could be transformative, he said.
Lieuwen said the uncertainty over the clean hydrogen tax credits threatens to undermine the nascent industry, which he said is crucial for transitioning away from fossil fuels. Pro-hydrogen power advocates are pushing for changes to the Treasury’s draft guidance.
“There’s been a lot of promise about hydrogen, there’s a lot of excitement and pent up demand because of these significant tax credits,” Lieuwen said. “This guidance will be make or break for a number of hydrogen projects.”
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