Plug Power CEO details building ‘the first green hydrogen network’ with Walmart and Amazon

Plug Power CEO Andy Marsh joins Yahoo Finance Live to discuss the company’s deal with Walmart to provide a network for hydrogen trucks and the state of the green energy shift amid the Russia-Ukraine war.

Video Transcript

AKIKO FUJITA: Welcome back to Yahoo Finance Live. We are seeing red across the board right now. Take a look at where the Dow is, trading down about 325 points. The S&P 500 down 1%. In terms of sectors that we're watching today, energy a big loser, down about 5 and 1/2% there. Certainly, we've been watching a lot of the headlines coming out of China, with Beijing now imposing restrictions because of a spike in COVID cases. That has led to concerns about demand in the energy space. So just one of many that's seeing big declines on this Monday.

Well, Plug Power is expanding its partnership with Walmart. The green hydrogen supplier announcing a deal last week to fuel the retailer's fleet of lift trucks. The deal builds on an existing pilot that began in 2012. To discuss more of the specifics there and much more on green hydrogen, we've got our friend of the show, Andy Marsh, Plug Power CEO.

Andy, good to talk to you again. I was thinking back to the last time we spoke. It was right at the start of the Russia-Ukraine War. And you said at the time that you thought this could really accelerate the transition to renewables. What have you seen over the last two months? And are you getting a lot of calls from places like Europe?

ANDY MARSH: The answer to that question is, yes, Akiko, and as I spoke about last week at the launch of the Plug Back Power new brand, one of the items is that we've, in the last 10 days, have actually booked over $45 million worth of electrolyzers, mostly in Europe. Now, electrolyzers are devices that take renewable electricity and create green hydrogen, which can be used for natural gas, for fueling, and for many, many other processes.

AKIKO FUJITA: So how much of that, do you think, could eat into the current energy supply? Russia obviously a big supplier on natural gas, as well as oil to Europe. If you're looking to supplant that with green hydrogen, how massive is the scale that you'd have to build out?

ANDY MARSH: Look, Akiko, we think that between now and 2030, there will be at least 130 gigawatts built out in Europe and Northern Africa to support their needs. It's a lot of energy, still a lot more to go. And look, what's going on will be a combination of new energy and obviously a leverage of using more fossil fuels temporarily, but to be able to address the court, their climate issues, there needs to be an acceleration to green energy. And I think that commitment in Europe has.

So now, green hydrogen has three valuable-- offers three valuable items to Europe. One, it helps reduce their CO2 footprint. Two, it creates jobs. And three, it's now become a national security issue, as we talked about before, Akiko.

AKIKO FUJITA: Let's talk about this announcement from last week. You've already had a partnership with Walmart. You've now announced that you have as many as-- you'll supply as many as 20 tons of green liquid hydrogen a day. What is that contingent on when you say as many as 20 tons?

ANDY MARSH: Well, I think when I look at it, Akiko, it's just really a start. You mentioned at the beginning of this conversation that in 2012, we started with Walmart with 50 forklift trucks and expanded to 9,500. Today, we're starting with 20 tons, and we expect it to get much bigger, as Walmart focuses on meeting its one gigaton per day. The reason we're building out this green hydrogen network are for our present customers like Amazon and Walmart. We'll be-- we're building the first green hydrogen network across the United States, which is 500 tons per day. We obviously think Walmart is going to be a lot bigger than that.

AKIKO FUJITA: Walmart and Amazon, those two names you mentioned, certainly big revenue drivers for the company. You've certainly been focused on forklifts for the warehouses. Where else do you see it expanding? Where are the opportunities for you right now?

ANDY MARSH: Well, we're expanding way beyond there, Akiko. Look at our JV in Europe with Renault, called HYVIA. So we expect to capture 30% of the fuel cell electric vehicle commercial vehicle market in 2030, which would be about 100,000 vehicles per year. We have activities going on with SK in South Korea, where we're building large scale stationary products. These products are not meant just for use in their-- in those regions, but around the world.

So most of Plug Power's development activities have to do with those items, not to mention the work we have going on with electrolyzers, which is meant for a broad spectrum of customers. For example, Orascom, the largest manufacturer of fertilizer in the world, we're building a 100 megawatt-plant within Cairo as we speak. So Plug is expanding not only in the fuel cell market, but in the electrolyzer market, as well as the hydrogen generation market.

AKIKO FUJITA: Well, cost has certainly been the biggest hurdle, I would argue, to widescale adoption. And you've specifically talked about in the past the cost of energy and renewable energy, which is what makes this green hydrogen. Are we getting closer to that price point where it's economical to go for green hydrogen? How far out are we from that?

ANDY MARSH: Well, Akiko, first, when you do deals with Walmart, I think that's a pretty strong statement that price is getting in line. We believe the number for generation of renewables needs to be about $0.03 a kilowatt hour to make hydrogen competitive. Those kind of pricings, we're already seeing in New York with the 45-ton per day green hydrogen plant we're putting in place using hydroelectric power.

We also see similar pricing for wind power in the wind belt of the United States. We believe-- and look, we believe green hydrogen is here today. And we believe this market is accelerating, not only because of national security issues, but because it is critical for helping companies meet their CO2 goals. When Walmart talks about reducing one gigaton per day, they need a lot of green hydrogen to do that.

AKIKO FUJITA: Well, and Andy, on that point, there's certainly been some bold forecasts out there about the potential for green hydrogen. Goldman Sachs saying that they see an addressable market roughly $12 trillion by 2050. How much of that do you think Plug Power can tap into?

ANDY MARSH: I believe, Akiko, there is going to be three main winners in this market. And one of them is going to be Plug Power. We have first mover advantage. We actually do real things every day, as I always remind our staff. And I think it'll be Plug will be one of the three, and I expect we're going to capture a large share of that market, because not only are we generating the green hydrogen, we have the ability to provide all the apps.

AKIKO FUJITA: Andy Marsh, always good to have you on this show, Plug Power CEO.