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Plug Power Bags Largest Electrolyzer Installation Order in the World
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Plug Power Bags Largest Electrolyzer Installation Order in the World

Hydrogen fuel cell systems developer Plug Power Inc. (NASDAQ: PLUG) recently revealed that it had bagged an order to supply a one gigawatt (GW) electrolyzer to European hydrogen company H2 Energy Europe.

The impending installation of the electrolyzer, which will be used for a green hydrogen production complex in Denmark, will make this the largest electrolyzer capacity installation globally.

Following the news, shares of the company rose 14% to close at $16.53 in yesterday’s trading session. The stock is continuing its gains today, up 2.9% so far.

Strategic Impact

Adversities like rising oil prices and climate change have become harsh realities. In such a scenario, green hydrogen is an efficient, sustainable, and eco-friendly solution to generate energy.

To that end, Plug’s electrolyzer technology will allow for up to 100,000 metric tonnes per year of green hydrogen to be produced, which will be used in northern Europe’s energy and transportation sector, catering to about 15,000 heavy-duty vehicles per day.

Notably, the coming together of Plug’s electrolyzer technology capabilities with H2 Energy’s engineering expertise is expected to substantially reduce carbon emissions in the transportation sector.

Management’s Commentary

The CEO of Plug, Andy Marsh, said, “We see green hydrogen as the future and have made significant investments in green hydrogen including in the construction of a gigafactory for electrolyzer production. Our operational readiness and manufacturing capacity were key determinants in our selection for the world’s largest order to date, and we are pleased to be a part of this project with H2 Energy.”

Wall Street’s Take

Recently, Susquehanna analyst Biju Perincheril reiterated a Buy rating on the stock. The analyst, however, lowered the price target from $33 to $30, which implies upside potential of 77.5% from current levels.

The consensus among analysts is a Strong Buy based on 10 Buys and three Holds. The average Plug Power price target of $36.08 implies upside potential of 113.5% from current levels. Shares have declined 40% over the past year.

Investors’ Stance

TipRanks’ Stock Investors tool shows that investors currently have a Very Negative stance on PLUG. Further, 2% of portfolios tracked by TipRanks decreased their exposure to PLUG stock over the past 30 days.

Conclusion

The European region has been enhancing its green energy capabilities rapidly. In such an exciting and growing region, Plug’s electrolyzer order of such a huge capacity is expected to bolster the company’s prospects in the region further and aid its financial and operational performance.

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