Discussion and legislation about green infrastructure continues to move at high levels of government around the world. Last November our ESG Safeguard platform picked-up on hydrogen as an emerging topic in earnings calls. This week we revisit that topic and two companies we highlighted: Plug Power (PLUG) and Bloom Energy (BE). An important narrative we continue to see revolves around firms leveraging public-private partnerships to offset CapEx for green infrastructure.

Sam Leavitt
November 18, 2021

ESG Spotlight: Public-Private Partnerships Fuel Renewables Expansion

ESG Spotlight: Public-Private Partnerships Fuel Renewables Expansion

Last November we wrote about hydrogen as an emerging topic in earnings calls. As discussion and legislation about green infrastructure continues to move at high levels of government around the world, companies involved in the hydrogen space are taking advantage of the recent optimism for sustainable infrastructure development. This week, we revisit hydrogen with our ESG Safeguard platform and focus on two of the companies that we featured last year, Plug Power (PLUG) and Bloom Energy (BE).

ESG Safeguard Platform: Electrical Equipment Industry Impact Score and Mentions, Past 30 Days

Plug Power

In September we noted that Plug Power has been tapped as the Airbus partner in the feasibility study for hydrogen aviation development. In more recent months, the company has focused on expansion of infrastructure and capacity. Plug Power posted its highest revenues in company history this quarter to the tune of $144M. The company is spending a lot of money to expand, which explains why they still operated at a loss this quarter, despite the high revenues. The largest project of the recent expansions for Plug is a new green hydrogen plant in Western New York. It will be the largest green hydrogen facility in North America.

The plant is located in the town of Alabama in Genesee County, New York. The facility is the first tenant of the New York Science, Technology and Advanced Manufacturing Park (STAMP), a new 1,250 acre site created to bring technology, clean energy jobs, and manufacturing to the area. Empire State Development is supporting the project with $2M in tax credits. Additionally, there is a plan in place for the New York Power Authority to provide Plug Power with electricity from the Niagara Falls Power Project to generate green hydrogen for the facility.

Plug Power’s larger strategy to expand operations include similar developments in Pennsylvania, Georgia, Europe, and Australia. The company aims to have seven facilities in North America by 2022 alone, and produce 1,000 tons of hydrogen daily by 2028. Since last year, Plug Power shares have grown 93.88% and they have demonstrated that they are a key player in the growing hydrogen space and have the partnerships and expansion opportunities to prove that.

Bloom Energy

California-based Bloom Energy (BE) has a strong operating footprint in South Korea. Last month BE extended their partnership and power contract with SK Ecoplant through 2024. The expanded partnership also has a stipulation for SK to purchase Bloom stock.

In California, the company announced a 1 MW facility that will turn cow manure into biogas and renewable electricity at Bar 20 dairy farm, and hopes to scale this technology up for use at other dairy farms. Bloom has been exploring hydrogen use for shipping, mostly with their partners in South Korea, but this concept around cow manure is another innovative way the company is thinking about growing their business. Bloom has also installed fuel cells in Colchester, Connecticut this month marking another use-case of their technology being chosen and implemented for municipal use. Bloom’s expansion plans may not be as big as Plug Power’s, but their wide range of patents in the hydrogen space and partners at home and abroad make them a major player in this space as well. Bloom stock is up 65.62% in the past year.

Public-Private Partnerships

As discussion and legislation about green infrastructure continues to move at high levels of government around the world, companies like Plug Power and Bloom will be operating in an increasingly favorable arena. While companies building green infrastructure require large CapEx, they also have opportunities to maximize tax incentives, as we see with Plug Power’s latest hydrogen plant. Green technology is the way of the future and companies investing in research and infrastructure now, while developing partnerships in the industry, will set themselves and their shareholders up for success in the future.

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