Plug Contracts with bp and Iberdrola Joint Venture to Supply 25 MW of PEM Electrolyzers for bp’s Castellón Refinery Project in Valencia, Spain

Rhea-AI Summary

Plug Power Inc. (NASDAQ: PLUG) has secured an order for 25 megawatts (MW) of proton exchange membrane (PEM) electrolyzer systems from bp and Iberdrola's joint venture, Castellón Green Hydrogen S.L. The project aims to decarbonize bp's Castellón refinery in Valencia, Spain, using five 5 MW containerized PEM electrolyzers. This initiative is expected to avoid 23,000 tons of CO2 emissions annually by replacing gray hydrogen with green hydrogen in refinery operations.

Plug CEO Andy Marsh highlighted the company's industry expertise and proven technology. The project represents a significant opportunity for Plug in the European green hydrogen market. Plug's experience includes operating the largest PEM electrolyzer system at its 15 ton per day Georgia hydrogen production plant and manufacturing capabilities at its Rochester Gigafactory. This deal marks the beginning of a long-term partnership with potential expansion up to 2 gigawatts of electrolysis capacity.

Positive

• Secured a 25 MW PEM electrolyzer system order for bp's Castellón refinery project
• Project expected to avoid 23,000 tons of CO2 emissions annually
• Potential for expansion up to 2 GW of electrolysis capacity
• Demonstrates Plug's expertise and market position in the growing European green hydrogen market
• Leverages Plug's experience with large-scale PEM electrolyzer systems and manufacturing capabilities

Negative

• None.

Financial Analyst

This contract win is a positive development for Plug Power, showcasing their ability to secure significant projects in the growing green hydrogen market. The 25 MW order from bp and Iberdrola's joint venture demonstrates market validation of Plug's PEM electrolyzer technology. While the financial terms weren't disclosed, this deal could potentially lead to substantial revenue growth if the project expands to its full 2 GW capacity.

However, investors should note that Plug's profitability remains a concern. The company's focus on scaling and market share acquisition has led to consistent losses. This project, while promising, may not immediately impact Plug's bottom line. The long-term partnership potential with industry giants like bp and Iberdrola is encouraging, but Plug needs to demonstrate improved financial performance to justify its current valuation.

Environmental Engineer

This project represents a significant step towards industrial decarbonization. The replacement of gray hydrogen with green hydrogen at bp's Castellón refinery is expected to avoid 23,000 tons of CO2 emissions annually, a substantial environmental benefit. Plug's PEM electrolyzers are well-suited for this application due to their efficiency and ability to operate dynamically with renewable energy sources.

The potential expansion to 2 GW of electrolysis capacity is particularly noteworthy. If realized, it would mark a major shift in industrial hydrogen production, potentially setting a precedent for other refineries globally. However, the success of this project will depend on factors such as the availability of renewable energy sources and the overall efficiency of the green hydrogen production process.

Market Research Analyst

This deal underscores the growing momentum in the European green hydrogen market. With the EU pushing for ambitious decarbonization targets, we're seeing increased adoption of green hydrogen technologies across industries. Plug Power's selection for this high-profile project could enhance its market position and lead to further contracts in Europe.

However, competition in this space is intensifying. Companies like Nel ASA and ITM Power are also vying for market share. Plug's success will depend on its ability to differentiate its technology and deliver projects efficiently. The potential for expansion to 2 GW is promising, but investors should monitor project execution and any announcements of further phases to gauge long-term growth prospects.

LATHAM, N.Y., Sept. 18, 2024 (GLOBE NEWSWIRE) -- Plug Power Inc. (NASDAQ: PLUG), a global leader in comprehensive hydrogen solutions for the green hydrogen economy, has secured an order for 25 megawatts (MW) of proton exchange membrane (PEM) electrolyzer systems from bp and Iberdrola’s joint venture, Castellón Green Hydrogen S.L. The project will employ five of Plug’s 5 MW containerized PEM electrolyzers with a 25 MW capacity to decarbonize the operations at bp’s Castellón refinery in Valencia, Spain and is expected to avoid 23,000 tons of CO2 emissions per year.

Plug’s electrolyzers will be used at the project led by bp and Iberdrola to produce green hydrogen, replacing part of the refinery’s current use of gray hydrogen generated from natural gas in its operations.

"The selection of Plug's technology for this project serves as a clear example of our established industry expertise and proven technology,” stated Plug CEO Andy Marsh. "Industry experts have highlighted the immense market potential for green hydrogen in Europe as being a key factor for reaching European Union decarbonization targets. This presents a significant opportunity for Plug, and we have the market knowledge and technology readily available to make a substantial impact.”

Plug will leverage its extensive experience in the green hydrogen industry, backed by 35 years of engineering and expertise following the acquisition of Frames in 2021. Plug's experience in deploying and operating PEM electrolyzer systems globally, highlighted by operating the largest system at its 15 ton per day (TPD) Georgia hydrogen production plant, underscores its ability to provide proven PEM electrolyzer technology for this project.

Plug's state-of-the-art Gigafactory in Rochester, N.Y., one of the largest PEM manufacturing facilities in the U.S., further demonstrates the company's ability to deliver on this project. Together, the Georgia plant and the Gigafactory are evidence of Plug's successful track record with PEM electrolyzer technology.

This deal marks the beginning of a long-term partnership and is the first step in decarbonizing bp's operations. The project will be developed in phases, with the potential expansion of up to 2 gigawatts (GW) of electrolysis capacity.

About Plug

Plug is building an end-to-end green hydrogen ecosystem, from production, storage, and delivery to energy generation, to help its customers meet their business goals and decarbonize the economy. In creating the first commercially viable market for hydrogen fuel cell technology, the company has deployed more than 69,000 fuel cell systems and over 250 fueling stations, more than anyone else in the world, and is the largest buyer of liquid hydrogen.

With plans to operate a green hydrogen highway across North America and Europe, Plug built a state-of-the-art Gigafactory to produce electrolyzers and fuel cells and is developing multiple green hydrogen production plants targeting commercial operation by year-end 2028. Plug delivers its green hydrogen solutions directly to its customers and through joint venture partners into multiple environments, including material handling, e-mobility, power generation, and industrial applications.

For more information, visit www.plugpower.com.

About Iberdrola
Iberdrola is the largest utility in Europe, and one of the top three largest globally, serving a population of more than 100 million people around the world. The company has a workforce of over 42,200 and assets in excess of €150 billion. In 2023, Iberdrola posted revenues of nearly €50 billion, net profit of €4.8 billion, with nearly €9.3 billion paid in tax contributions in the countries where it operates. The company helps to support more than 500,000 jobs in communities across its supply chain, and global supplier purchases topped €18.1 billion in 2023.

A benchmark in tackling climate change, Iberdrola has invested more than €150 billion over the past two decades to help build a sustainable energy model, based on sound environmental, social and governance (ESG) principles. 

Plug Power Safe Harbor Statement

This communication contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks and uncertainties about Plug Power Inc. (“Plug”), including but not limited to statements about: Plug’s ability to deliver on its electrolyzer order from bp and Iberdrola’s joint venture, Castellón Green Hydrogen S.L., and the use of its electrolyzers to produce green hydrogen and replace part of the refinery’s use of gray hydrogen; expectations about the project’s ability to avoid 23,000 tons of CO2 emissions per year and potential expansion of up to 2 gigawatts of electrolysis; Plug’s beliefs about the market potential for green hydrogen in Europe and its significant opportunity for Plug. Such statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in these statements. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Plug in general, see Plug’s public filings with the Securities and Exchange Commission (the “SEC”), including the “Risk Factors” section of Plug’s Annual Report on Form 10-K for the year ended December 31, 2023, Plug’s Quarterly Reports on Form 10-Q for the quarters ended March 31, 2024 and June 30, 2024 and any subsequent filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements are made as of the date hereof, and Plug undertakes no obligation to update such statements as a result of new information.

MEDIA CONTACT

Fatimah Nouilati
Allison
plugPR@allisonpr.com

FAQ

What is the size of the PEM electrolyzer order Plug Power received for bp's Castellón refinery project?

Plug Power received an order for 25 megawatts (MW) of proton exchange membrane (PEM) electrolyzer systems for bp's Castellón refinery project in Valencia, Spain.

How much CO2 emissions is the Plug Power project expected to avoid at bp's Castellón refinery?

The project using Plug Power's PEM electrolyzers is expected to avoid 23,000 tons of CO2 emissions per year at bp's Castellón refinery.

What is the potential expansion capacity for the Plug Power project with bp and Iberdrola?

The project has the potential for expansion of up to 2 gigawatts (GW) of electrolysis capacity in future phases.

How many 5 MW containerized PEM electrolyzers will Plug Power (PLUG) supply for the bp Castellón refinery project?

Plug Power will supply five 5 MW containerized PEM electrolyzers, totaling 25 MW capacity, for the bp Castellón refinery project.